EJ Antoni (Heritage) is dubious about GDPNow’s (and other nowcasts) regarding Q3 growth. From X aka Twitter today:
“Latest Q3 Nowcasts: ATL 2.5% (2.0% prev) NY 2.49% (1.94 prev) STL 2.05% (1.65 prev) It’s going to take stellar consumer spending numbers for Aug and Sep to make this a reality:”
Well, here’s a picture of nowcasts as of today. GDPNow is 3.4% q/q AR for Q3, up from 3.2% on 10/9.
The nowcast for consumption was 3.8% q/q AR. I noted that this was plausible. What does today’s nowcast indicate? 3.6%.
Back when Heritage boy made his comment, we needed both August and September real PCE data. Now, we just need September.
If there is a 0.2% rise in real PCE in September, with no revisions to earlier months, real PCE will have increased at a 3.8% annualized pace in Q3. If there was no growth in real PCE in September, no revisions otherwise, real PCE will have increased at a 3.0% pace. Assuming my math is right. Keep in mind retail sales were up 0.4% in September.
Here are the data:
https://fred.stlouisfed.org/graph/?g=1wnrB
None of this matters in Heritage world. Not one bit.
Here’s my data on another topic:
https://fred.stlouisfed.org/series/B235RC1Q027SBEA
Federal government current tax receipts: Taxes on production and imports: Customs duties
Faux Business News invited Stephen Moore to do some more of his patented lying. When asked about the Trump tariffs, Moore actually tried to convince the MAGA morons who watch this clown show that Biden was worse on tariffs than Trump. Well maybe on a few strategic items, tariff rates are now higher than they were in 2019. But not across the board. After all we are importing more goods and bringing in less tariff revenues.
Oh wait – Moore would likely mansplain that by some Laffer curve BS! Huh – Trump is pretending he can massively raise tariff rates with no impact on how much people import. The wonders of the mixed minds on Faux Business News!
Remember when all the MAGA morons were mocking Biden for being sleepy Joe? Huh – they’ve grown silent of late. I wonder if Trump’s old age problems are like the cat that have their tongues. They are being eaten by cats!
https://www.msnbc.com/all-in/watch/-exhausted-trump-appears-to-fall-asleep-at-campaign-event-222149701621
We may not be in a recession, but economic activity has changed for consumers’ big ticket items. As an example, here is a bit of history on the average age of vehicles. Given the rapid rise of vehicle prices in the last four years, it appears that people are stretching out their ownership period.
https://www.caranddriver.com/news/a60882953/average-age-us-cars-trucks-suvs-rises/
More of those who are buying new vehicles and trading in their old ones are increasingly “upside down” on their loans which can mean kicking the can down the road for problems.
https://finance.yahoo.com/news/negative-equity-rise-average-amount-130300488.html
Another big ticket item, homes, have reach record real prices and that’s a problem, too. The number of new homes sold is about the same as the mid-to-late 1980s with a much larger population.
https://fred.stlouisfed.org/series/QUSR628BIS
https://fred.stlouisfed.org/series/HSN1F
So, is the economy humming along? Well, maybe yes, but there should be concerns when consumers have to dramatically change their behaviors due to being stretched economically. And with “free money” gone, the issue may be getting worse.
As Bill Clinton once so famously said: “It depends on what the meaning of the word ‘is’ is.”