Comments on: A Preliminary Reading of the GDP Report

By: Finrod

Finrod — Mon, 03 Aug 2009 16:41:46 +0000

I don’t remember the episode but it’s mostly a Mary Poppins takeoff, but parodying a My Fair Lady song, as _Wouldn’t It Be Adequate_; where ‘adequate’ for Lisa is a B+ on a report card, but for Bart it’s a D-.

By: bk

bk — Mon, 03 Aug 2009 14:24:20 +0000

Doctor: “Congratulations. You no longer have cancer.”
Patient: “You mean it’s gone into remission?”
D: “Oh hell no – it’s still growing, just not as fast due to all the drugs we pumped into that you’ve spent your life savings on.”
P: “Then WTF are you talking about?”
D: “I count slower growth rate as curing it so that I can advertise myself as a miracle worker.”

By: Marcus_Traianus

Marcus_Traianus — Mon, 03 Aug 2009 14:01:17 +0000

I have not settled on any particular outcome. While some encouraging signs are evident, others are not. The continued outlook on consumer confidence and employment are two big signs for me of a “mixed bag”.

The Treasury auctions last week ultimately told me nothing (although I am curious about the last minute $2b by on the 7-year. I am not very confident on the upcoming auctions which I believe may be more indicative since they are not coming at month end. Primary Dealers are going to be under substantial pressure to keep pushing Treasuries and I am just not sure where the runway will be.

I think the corporate debt activity is healthy and a positive sign, but some of that is being driven by the CDS exodus. The market smells big regulatory changes coming and will find another venue to trade in until that settles down (personally, I wonder if CDS will ever recover). This will benefit the better quality corporate issues where “protection” is not an issue. At the end of the day, inflation is still a wild card for me. I just can’t gauge what will happen with all that liquidity and have zero confidence the FED will “ratchet” things at the right time.

One thing I thought was interesting; Wal-Mart selling $83 odd billion in Samurai bonds. Any thoughts?

By: lukematthews

lukematthews — Fri, 31 Jul 2009 23:15:34 +0000

This report is anything but clear. It is just a doctored bit of nonsense that will be revised downward later on. The first quarter data was worse than reported. This is political cover to make it seem the non-stimulus package is having an effect, which it is not.

By: toni100

toni100 — Fri, 31 Jul 2009 23:08:04 +0000

at least the fiance works for a defense contractor. The downside, we’ll never get married at this rate! Haven’t seen him in a long time.

By: smitty

smitty — Fri, 31 Jul 2009 19:29:54 +0000

I thought the same thing I read the AP headlines. SO the economy sucked, but not as bad as we thought.

I should have tried that in school. Well dad I thought I was getting an F but GOOD NEWS, I got a D- lets celebrate!

By: Francis Cianfrocca

Francis Cianfrocca — Fri, 31 Jul 2009 19:14:26 +0000

The 2 and 5 years were messy and underbid. The 7-year went great, surprising everyone by trading through the market instead of tailing. I heard chatter that someone had bid large on the 7-year, possibly to cover a short, so it could be an outlier.

I think that overall, the capital markets are pricing in a powerful recovery. I also think we may be seeing the beginning of the next asset bubble, which will be in corporate bonds.

Have you looked at the corporate debt issues which have been pricing this week? There is hunger for this paper out there. Unless the yield curve flattens a whole lot, none of this makes sense.

By: johnCV

johnCV — Fri, 31 Jul 2009 19:00:46 +0000

Defense companies and health companies are spending. The bailed-out financial companies are spending. The governments are spending.

My level of revulsion for all things governmental is rapidly boiling over.

By: Finrod

Finrod — Fri, 31 Jul 2009 18:39:01 +0000

Recession Continues Unabated No End In Sight for Bad Economy GDP Continues Downward Spiral etc.

By: Marcus_Traianus

Marcus_Traianus — Fri, 31 Jul 2009 18:08:22 +0000

Agreed, this report and general political reaction masks the real issues.

We have yet to encounter and fully discover the affects of Obama’s policies on any recovery- only that his actions will generally slow overall growth, have a severe negative impact on businesses- especially small/medium sized, increase the tax burden on individuals and slow real job growth outside the government sector.

When looking at the 5 and 7 years auctions this week, one can only wonder what the future will bring. How long will the Indirect bidders keep saving the day?

By: jimmuy8

jimmuy8 — Fri, 31 Jul 2009 18:02:24 +0000

The fellow over at The Market Ticker shows how the “savings rate” put out really isn’t a measure of savings like most people think, e.g. money in the bank.

Consumers are cutting back and trying to pay off debt, they aren’t hoarding money under their mattress or in savings account.

http://bit.ly/mxTIS
http://bit.ly/rWxhk

If you follow the graph, he says there needs to be something like a 30% contraction to get us back to the 1980 levels. That’s 6% per year for 5 years or 3% for 10–that’s a pretty awful scenario that I hope we won’t see but, I’m afraid it’s inevitable.

Something has to break.

By: DONTREADONME

DONTREADONME — Fri, 31 Jul 2009 17:56:37 +0000

but heh, the AP really wants it to be, so we get the obligatory experts/analysts expected 1.5%.

Look mom, I can do it too, experts shocked that global termperatures failed to rise accroding to expectations of 0.2 degrees C.