It’s an improvement over the advance estimate issued two months ago of -0.1% contraction, but … not by much. At least we won’t have to hear people talk about the greatest contraction evah:

Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 0.4 percent in the fourth quarter of 2012 (that is, from the third quarter to the fourth quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 3.1 percent.

The GDP estimate released today is based on more complete source data than were available for the “second” estimate issued last month. In the second estimate, real GDP increased 0.1 percent. While nonresidential fixed investment is higher than previously estimated, the revision to GDP has not changed the general picture of the economy (for more information, see “Revisions” on page 3).

The increase in real GDP in the fourth quarter primarily reflected positive contributions from personal consumption expenditures (PCE), nonresidential fixed investment, and residential fixed investment that were partly offset by negative contributions from private inventory investment, federal government spending, exports, and state and local government spending. Imports, which are a subtraction in the calculation of GDP, decreased.

The deceleration in real GDP in the fourth quarter primarily reflected downturns in private inventory investment, in federal government spending, in exports, and in state and local government spending that were partly offset by an upturn in nonresidential fixed investment, a larger decrease in imports, and an acceleration in PCE.

One indicator shows a more positive outlook, at least relatively speaking. Real final sales of domestic product — what actually got sold to end users, as opposed to inventoried — rose 1.9% in Q4. That’s still a stagnation figure, but it does point out the negative impact of inventory transactions in this quarter, and gives perhaps a better indication of the direction of the economy without the swings of government spending. That improved even more than the overall number from the advance estimate, which was 1.1% in January.

Overall GDP in 2012 remained unchanged from the previous interim estimate at 2.2%. That is also a stagnation figure, hardly enough to boost job expansion, and far off from the Obama administration’s economic projections on which they based their budgeting over the last four years. It’s an improvement over 2011′s 1.8%, but again, not by much, and the trendline is dropping downward again.

On the other hand, corporate profits increased 6.8% in 2012, down slightly from a 7.3% increase in 2011. What does that tell us? Corporations are holding onto capital, unwilling to invest it in the American economy. Given the regulatory environment and economic policies of the Obama administration, don’t expect that to change.

Reuters isn’t impressed with the report, either, and notes a rise in weekly initial jobless claims:

-snip-

Read more:http://hotair.com/archives/2013/03/28/fi...-pegged-at-0-4/

Looks like I was richtig. Their final 0.4 was in the my 0.2-0.5% estimate.

(Cue: latest shadowstats.com SGS GDP chart from algernonpj!)

Quote: FP123 wrote in post #2

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Looks like I was richtig. Their final 0.4 was in the my 0.2-0.5% estimate.

(Cue: latest shadowstats.com SGS GDP chart from algernonpj!)

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From zerhedge about revision to 2012 fourth quarter GDP.

Final Q4 GDP Misses As Personal Consumption Slides Once More - Full Breakdown



Edit: This chart was created using government figures which overstate the GDP.

From your ZH link:

"The full breakdown by various components is shown below, with the most notable, Personal Consumption Expenditures, showing a gradual and consistent decline over the past three months as it was revised relentlessly lower, dropping from 1.52% in the first revision, to 1.47% in the second, to 1.28% in the final. Offsetting this was a jump in Fixed Investment which rose to 1.69%, the highest since Q3 2011. Supposedly this implies that capital spending is soaring, when in reality companies continue to curb CapEx plans, instead focusing on short term shareholder gains such as buybacks and dividends, which is to be expected in the absence of any actual end-demand. "

(Which reminds me, their was a very thorough ZH article from a day or so ago that I was going to post.)

Eh... I'm as skeptical of shadowstats and ZH as I am of the government reports.

There's enough truly bad stuff in the official reports, no need to resort to kooky websites that nobody is going to believe anyway.

Quote: Weird Tolkienish Figure wrote in post #6

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Eh... I'm as skeptical of shadowstats and ZH as I am of the government reports.

There's enough truly bad stuff in the official reports, no need to resort to kooky websites that nobody is going to believe anyway.

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Zitat

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t’s an improvement over the advance estimate issued two months ago of -0.1% contraction,

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Awesome. I knew the Regime would turn this economy around. this spectacular 0.4% growth rate just proves it.

Quote: Weird Tolkienish Figure wrote in post #6

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Eh... I'm as skeptical of shadowstats and ZH as I am of the government reports.

There's enough truly bad stuff in the official reports, no need to resort to kooky websites that nobody is going to believe anyway.

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Zitat

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. . . One of my early clients was a large manufacturer of commercial airplanes, who had developed an econometric model for predicting revenue passenger miles. The level of revenue passenger miles was their primary sales forecasting tool, and the model was heavily dependent on the GNP (now GDP) as reported by the Department of Commerce. Suddenly, their model stopped working,. . .

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In the process of debugging his clients ecnonomic model Williams discovered that the quality of government reporting had deteriorated sharply. Reporting problems included methodological changes to economic reporting that pushed headline economic and inflation results out of the realm of real-world or common experience. Williams' workd led to front page stories in 1989 in the New York Times and Investors Daily (now Investors Business Daily)

While there always have been modifications to the way unemployment, inflation, and real GDP were calculated, these changes did not have a major impact on the results until the mid 1980's. At that point changes in methodology had a major impact on the results and started moving government economic reporting into lala land.

Williams' web site was started in 2004. He sells services and offers a lot of free information. Williams uses blue lines to indicate his best approximation of the statistics if they were calculated the old way. The red line indicates the statistics calculated by the government.

I have researched Williams' claims about the changes to methodology and verified them. Not an easy task since the government tend s to make such information difficult to locate. It is what I call 'hidden in plai sight'.

Here's a brief summary of how government statistics have been corrupted.

Unemployment
A major rewrite of the way unemployment statistics are presented and calculated was released in 1994. It had been in the works for several years. The number of U's were changed from 7 to 6. As of 1994, if you are long term discouraged you are moved out of the civilian labor force.

The major ways the unemployment rate is manipulated are seasonal adjustment and determining which bucket you belong in, e.g. are you part of the civilian labor force.

CPI
The CPI was set up to measure a set standard of living. The calculation of the CPI was adjusted to accommodate new consumer products as they hit the market, e.g. TV, flat screen TV, cell phones.

Since the mid 1980's the CPI has been changed to represent the cost of a declining standard of living through the use of several methodology changes including (but not limited to):

Substitution Effect: The theory is that if the cost of something goes up you will substitute a cheaper item and the cost of living did not go up. An example would be if the cost of a certain cut of beef went up you would substitute a cheaper cut of beef; therefore there was no inflation.
Renter's Equivalence: Instead of the actual cost of owning a home, the cost of renting is substituted. See those increased real estate taxes never happened.
Intervention Analysis: If the cost of say gas goes up "too much" a statistical tool is used to bring down its effect on the CPI.
Hedonics: If a quality improvement increases the cost of an item, the actual cost is lowered by the perceived pleasure the consumer receives from that improvement. An example is a government mandated change to gasoline for cleaner air increases its cost. That additional cost is removed in the CPI calculations because of your increased pleasure in the clear air.
Core Inflation: Core inflation does not count the cost of energy and food (because they are so "volatile"). This is also called headline inflation. It is the number the government, the Fed, and the media bandy about. It is also the number used to determine how well the federal reserve does its job in controlling inflation.

GDP
Since real GDP is created ay applying the CPI, the more the CPI under reports inflation, the more the real GDP over states Gross Domestic Product.

In addition the GDP includes government spending, so the larger percent of the GDP represented by the government , the more the GDP over states production.

If anything I posted is unclear or confusing I will try to clarify.

Quote: algernonpj wrote in post #9

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[quote=Weird Tolkienish Figure|p25614]Eh... I'm as skeptical of shadowstats and ZH as I am of the government reports.


Substitution Effect: The theory is that if the cost of something goes up you will substitute a cheaper item and the cost of living did not go up. An example would be if the cost of a certain cut of beef went up you would substitute a cheaper cut of beef; therefore there was no inflation.
Renter's Equivalence: Instead of the actual cost of owning a home, the cost of renting is substituted. See those increased real estate taxes never happened.
Intervention Analysis: If the cost of say gas goes up "too much" a statistical tool is used to bring down its effect on the CPI.
Hedonics: If a quality improvement increases the cost of an item, the actual cost is lowered by the perceived pleasure the consumer receives from that improvement. An example is a government mandated change to gasoline for cleaner air increases its cost. That additional cost is removed in the CPI calculations because of your increased pleasure in the clear air.
Core Inflation: Core inflation does not count the cost of energy and food (because they are so "volatile"). This is also called headline inflation. It is the number the government, the Fed, and the media bandy about. It is also the number used to determine how well the federal reserve does its job in controlling inflation.

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Quote: Weird Tolkienish Figure wrote in post #10

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Quote: algernonpj wrote in post #9

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[quote=Weird Tolkienish Figure|p25614]Eh... I'm as skeptical of shadowstats and ZH as I am of the government reports.


Substitution Effect: The theory is that if the cost of something goes up you will substitute a cheaper item and the cost of living did not go up. An example would be if the cost of a certain cut of beef went up you would substitute a cheaper cut of beef; therefore there was no inflation.
Renter's Equivalence: Instead of the actual cost of owning a home, the cost of renting is substituted. See those increased real estate taxes never happened.
Intervention Analysis: If the cost of say gas goes up "too much" a statistical tool is used to bring down its effect on the CPI.
Hedonics: If a quality improvement increases the cost of an item, the actual cost is lowered by the perceived pleasure the consumer receives from that improvement. An example is a government mandated change to gasoline for cleaner air increases its cost. That additional cost is removed in the CPI calculations because of your increased pleasure in the clear air.
Core Inflation: Core inflation does not count the cost of energy and food (because they are so "volatile"). This is also called headline inflation. It is the number the government, the Fed, and the media bandy about. It is also the number used to determine how well the federal reserve does its job in controlling inflation.

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Eh, hedonic pricing isn't the "scam" that hysterics claim it is. Fact is that people have more technology in the palm of their hand than ever and it's cheaper and more ubiquitous than ever. This is something that should be represented as an economy benefit.

Obama is killing the short term economy, but official stats represent this. Americans are burdened by too much, not too little. Too much food, too much consumerism, etc.

THe problems with the economy in the long term view is that it works *too* well, not well enough.

In the short term, I agree.

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Quote: algernonpj wrote in post #11

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This methodology of calculation is deceptive, duplicitous, and conveniently suppresses the actual CPI. The same can be said for owner's rental equivalence, the substitution effect, intervention analysis, geometric weighting, chained dollars, core inflation, and seasonal analysis. The great thing about BLS math is that one plus one does not always = two.

And as inflation is under reported, seasonally adjusted GDP is over reported. A two-fer.

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Quote: algernonpj wrote in post #4

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Edit: This chart was created using government figures which overstate the GDP.

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Quote: Thunderbird wrote in post #13

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Quote: algernonpj wrote in post #4

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Edit: This chart was created using government figures which overstate the GDP.

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Those export numbers are really weak.

Didn't Obama promise to double exports by the end of 2014..or was that one of those "lofty" goals never intended to be achieved?

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Quote: Thunderbird wrote in post #13

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Quote: algernonpj wrote in post #4

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Edit: This chart was created using government figures which overstate the GDP.

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Those export numbers are really weak.

Didn't Obama promise to double exports by the end of 2014..or was that one of those "lofty" goals never intended to be achieved?

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