David Rosenberg on Q3 GDP Via Zero Hedge

October 30th, 2009 10:22 am | by John Jansen |

My close personal friend(s) at Zero Hedge have posted an excellent and insightful analysis of the GDP data by David Rosenberg . He demonstrates that most of the gain was driven by government stimulus and ex the stimulus it was a less than festive quarter.

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  1. 5 Responses to “David Rosenberg on Q3 GDP Via Zero Hedge”

  2. By ejsmith on Oct 30, 2009 | Reply

    the blogosphere seems to universally hate that GDP number. It didn’t help the dollar at all, which seems strange.

    JJ, last Spring didn’t you make a call for positive GDP in the third quarter? Maybe you said Q4? I can’t remember exactly.
    Anyway, now this positive growth is here and no one wants to enjoy it.

    Does anybody remember laughter? 8)

  3. By John Jansen on Oct 30, 2009 | Reply

    I am not sure what I said yesterday!!!

    Growth has shifted and we avoided the abyss but I think that growth over the next several years will be very different to what we had become conditioned to over the last quarter century or so.

  4. By Bman on Oct 30, 2009 | Reply

    Feels like the inverse of the breakdown. Some waited to sell until the “official” declaration of Recession was made and it was too late. Now, like it usually happens, the market is forward-looking and prices in some positive growth. Others will wait for two positive quarters of GPD and an “official” declaration that the recession has ended…

  5. By Andrew on Oct 30, 2009 | Reply

    hahahahaha all completely planned. The goverments mandate “we must reinflate” “we must reinflate” WE MUST REINFLATE. this is all too easy to call, massive inflation here we come. What do you think happens when trillions of freshly printed dollars cycles through the US economy and World economy. Can we say NEW asset bubbles are coming! bye bye dollar……

  6. By ejsmith on Oct 30, 2009 | Reply

    here’s your call from April 29. Perhaps you weren’t quite as optimistic as I recall, but it is still in the ballpark. I included Spectre of deflation’s comment for fun.

    GDP much weaker than expected at -6.1 versus consensus of -4.7. It looks like the big miss was in business fixed investment which declined at an annual rate of 38 percent. That was the steepest decline in the post war era. (The war being my father’s war, World War 2).

    One line item that seems odd is the decline in government spending. Government spending subtracted 0.8 percent from GDP.

    I guess the good news here is that the number is so bad that it would take another Lehman Brothers type event to sustain these levels. There is certainly an inventory cycle underway and replenishment will provide a boost.

    And it is unlikely that government spending will be negative any time again in our lifetimes.

    So we are probably ver the worst and the question before the house is how long will it take to claw back to zero. I would guess Q4 2009 or Q1 2010.

    By SPECTRE of Deflation on Apr 29, 2009 | Reply

    It’s all good then? The 10 adding 50 tails since quantatative easing was started must mean buying our own Treasury Bonds has been a huge success, no? You might want to follow tax receipts because they are monthly and accurate. The problem is they have fallen off a cliff be it local, state or federal.

    Your 4th quarter call will burn you badly. The banks are insolvent, and we both know it. 1.4 Quadrillion Dollars in Derivatives of which 95% are on margin say you are oh so wrong. You trying for a position on CNBS? Sidekick to Steve Leisman?

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