• 2 hours Is $90 Oil Possible? An Interview With Jay Park
  • 19 hours Billions Of Dollars Are Flooding Into The Flying Taxi Space
  • 1 day Is This The Most Important Energy Project Of 2020?
  • 2 days Startups Are Dying To Give You A Better Death
  • 2 days U.S. Restaurants Are Struggling With Rising Labor Costs
  • 3 days The Banking Bonanza Is Just Getting Started
  • 3 days How The Trade War Ceasefire Will Impact The Energy Industry
  • 4 days Who Is The Most Dangerous Person On The Internet?
  • 4 days SoftBank Sees First Quarterly Loss In 14 Years
  • 6 days Prepare For An Oil Glut In 2020
  • 7 days Why A Strong Yuan Is A Promising Sign For The Trade War
  • 8 days What Would You Sacrifice For A Debt-Free Life?
  • 8 days Shareholders Urge Major Bank To Stop Funding Fossil Fuel Companies
  • 8 days Tariffs Are Causing A Slowdown In U.S. Manufacturing
  • 9 days The Great Silicon Valley Migration Has Begun
  • 9 days 3 Oil Stocks Paying Out Promising Dividends In 2020
  • 10 days How Fractional Trading Is Democratizing the Stock Markets
  • 10 days Why Smart Money Is Looking To Short Aramco
  • 10 days Gold Major Looks To Hike Dividends By 79%
  • 11 days Three Reasons Precious Metals Are On The Rise
Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

  1. Home
  2. Markets
  3. Other

GDP at Stall Speed Once Again

Inquiring minds may be interested in the initial Atlanta Fed GDPNow Estimate for 4th quarter 2015. Here is the chart.

GDP Now Forecast 1

The ISM release on November 2 had a big impact.

The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2015 is 1.9 percent on November 2, down from 2.5 percent on October 30. Following this morning's Manufacturing ISM Report On Business, the forecast for fourth-quarter real consumer spending growth declined from 2.9 percent to 2.4 percent while the forecast for real equipment investment growth declined from 3.9 percent to 1.3 percent.

GDP Now Forecast 2

I wrote about the ISM report on November 2 in Manufacturing ISM Flirts With Contraction Third Month, Employment Shifts to Contraction

Although the ISM index was the lowest reading since May of 2013, the reading was still positive (presumably showing growth).

I sometimes have difficulty predicting large moves in GDPNow estimates following economic news releases. This was one of those times.

The GDPNow model sees things this way.

GDP Model

I would have guessed a decline of 0.2% or so. Instead, the model says the ISM numbers led to a 0.6% decline.

Regardless, here we go again. The initial GDPNow estimate is already contracting, and is below the stall speed of 2.0% growth.

And the Fed, for the first time ever, now seeks to hike interest rates in December with GDP averaging a mere 2%± growth for an entire year.

 

Back to homepage

Leave a comment

Leave a comment