Economic Outlook

GDP Now and STAGFLATION

With the collection of data from the Atlanta FEDs we see a rapidly deteriorating US economy. The GDP forecast dropped from 6.1 annualized GDP growth to 1.3!! This is a major concerning development. If we take the formula of GDP = Money Supply x Velocity of Circulation we receive a GDP of 23,416.46 billion US Dollar. But those numbers are quarterly numbers reaching back to April 2021, released in July and August. Now the GDP NOW data running a model that updates the GDP every time there is a major economic announcement. See the graph. If we take the current 1.3% GDP into account we would receive 18,801 billion Dollar GDP number for the Q3 of 2021. This number is derived from Q3 2020 x 1.3% annual growth. The difference are a jaw opening 7 billion Dollar!! The US economy is in STAGFLATION. as inflation is supposed to come down in an economical slow down, but IS NOT. High inflation and a stagnant economy is Stagflation par definition.

The commentaries for the 75 most recent GDPNow updates are below, starting with the latest estimate.

OCTOBER 8, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 1.3 percent on October 8, unchanged from October 5. After this morning’s releases of the employment situation report by the US Bureau of Labor Statistics and the wholesale trade report from the US Census Bureau, an increase in the nowcast of third-quarter real gross private domestic investment growth from 10.5 percent to 10.7 percent was offset by a decrease in the nowcast of third-quarter real personal consumption expenditures growth from 1.1 percent to 1.0 percent.The next GDPNow update is Friday, October 15. Please see the “Release Dates” tab below for a list of upcoming releases.

OCTOBER 5, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 1.3 percent on October 5, down from 2.3 percent on October 1. After recent releases from the US Bureau of Economic Analysis, the US Census Bureau, and the Institute for Supply Management, the nowcasts of third-quarter real personal consumption expenditures growth and third-quarter real gross private domestic investment growth decreased from 1.4 percent and 12.9 percent, respectively, to 1.1 percent and 10.5 percent, respectively, while the nowcast of the contribution of the change in real net exports to third-quarter real GDP growth decreased from -1.27 percentage points to -1.57 percentage points.The next GDPNow update is Friday, October 8. Please see the “Release Dates” tab below for a list of upcoming releases.

OCTOBER 1, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 2.3 percent on October 1, down from 3.2 percent on September 27. After recent releases from the US Bureau of Economic Analysis, the US Census Bureau, and the Institute for Supply Management, the nowcasts of third-quarter real personal consumption expenditures growth and third-quarter real gross private domestic investment growth decreased from 2.2 percent and 15.9 percent, respectively, to 1.4 percent and 12.9 percent, respectively, while the nowcast of the contribution of the change in real net exports to third-quarter real GDP growth increased from -1.36 percentage points to -1.27 percentage points.The next GDPNow update is Tuesday, October 5. Please see the “Release Dates” tab below for a list of upcoming releases.

SEPTEMBER 27, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 3.2 percent on September 27, down from 3.7 percent on September 21. After the September 21 GDPNow update and subsequent releases from the National Association of Realtors and the US Census Bureau, the nowcast of third-quarter real gross private domestic investment growth decreased from 19.0 percent to 15.9 percent.The next GDPNow update is Friday, October 1. Please see the “Release Dates” tab below for a list of upcoming releases.

SEPTEMBER 21, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 3.7 percent on September 21, up from 3.6 percent on September 16. After this morning’s housing starts report from the U.S. Census Bureau, the nowcast of third-quarter real residential investment growth increased from -1.6 percent to -1.5 percent.

SEPTEMBER 16, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 3.6 percent on September 16, down from 3.7 percent on September 10 after rounding. After this week’s releases from the U.S. Bureau of Labor Statistics, the U.S. Department of the Treasury’s Bureau of the Fiscal Service, the U.S. Census Bureau, and the Federal Reserve Board of Governors, a decrease in the nowcast of third-quarter real gross private domestic investment growth from 19.2 percent to 18.9 percent was partially offset by an increase in the nowcast of third-quarter real personal consumption expenditures growth from 2.1 percent to 2.2 percent, while the nowcast of the contribution of the change in real net exports to third-quarter real GDP growth increased from -1.41 percentage points to -1.37 percentage points.

SEPTEMBER 10, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 3.7 percent on September 10, unchanged from September 2 after rounding. After the September 2 GDPNow update and subsequent releases from the U.S. Census Bureau, the U.S. Bureau of Labor Statistics, and the Institute for Supply Management, an increase in the nowcast of third-quarter real personal consumption expenditures growth from 1.9 percent to 2.1 percent was offset by a decrease in the nowcast of third-quarter real gross private domestic investment growth from 19.3 percent to 19.1 percent after rounding.

SEPTEMBER 2, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 3.7 percent on September 2, down from 5.3 percent on September 1. After this morning’s releases from the Bureau of Economic Analysis and the U.S. Census Bureau, the nowcasts of third-quarter real personal consumption expenditures growth and third-quarter real gross private domestic investment growth decreased from 2.6 percent and 23.4 percent, respectively, to 1.9 percent and 19.3 percent, respectively, while the nowcast of the contribution of the change in real net exports to third-quarter real GDP growth decreased from -0.90 percentage points to -1.41 percentage points.

SEPTEMBER 1, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 5.3 percent on September 1, up from 5.1 percent on August 27. After this morning’s Manufacturing ISM Report On Business from the Institute for Supply Management and the construction spending report from the U.S. Census Bureau, an increase in the nowcast of third-quarter real personal consumption expenditures growth from 2.2 percent to 2.6 percent was partially offset by a decrease in the nowcast of third-quarter real gross private domestic investment growth from 23.6 percent to 23.4 percent.

AUGUST 27, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 5.1 percent on August 27, down from 5.7 percent on August 25. After recent releases from the Bureau of Economic Analysis and the U.S. Census Bureau, the nowcasts of third-quarter real personal consumption expenditures growth and third-quarter real gross private domestic investment growth decreased from 3.2 percent and 26.5 percent, respectively, to 2.2 percent and 23.6 percent, respectively, while the nowcast of the contribution of the change in real net exports to third-quarter real GDP growth increased from -1.39 percentage points to -0.90 percentage points.

AUGUST 25, 2021

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 5.7 percent on August 25, down from 6.1 percent on August 18. After recent releases from the National Association of Realtors and the U.S. Census Bureau, the nowcast of third-quarter real gross private domestic investment growth decreased from 29.2 percent to 26.5 percent.

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