Monday, March 1, 2010

Dune Buggy Primary Games Cheat

Economic news: The rebound of U.S. GDP in the 4th quarter in detail.


T3: 3 rd quarter
T4: 4 th quarter
Here is the first published account by the U.S. Treasury on GDP growth to 4 th
quarter and throughout the year. The 1 st thing that strikes us is the strong GDP growth in an era estimate to 4 th quarter rising to 5.7 points.
But that figure hides
information we will try to decipher. First keep in mind that the 1 st
estimate of 3 rd quarter was 3.7 points before finally being revised to 2.2 points.
Then I am very surprised at some comments in the press who speak of "continuous growth started at 3 rd
quarter. Now we observe a interesting thing: growth of 4 th quarter was not all the same source as the growth of 3 rd quarter.
Indeed on the 3 rd
quarter is observed that only consumption (it is red on the previous document), which is GDP growth. This is quite normal as in normal consumption constitutes 66% of U.S. GDP.
However the 4 th
quarter, consumption was much weakened and does just that 35% of GDP growth. (2.2 points on 5.7 points.)
Thus there is a complete change in the structure of GDP would now be supported by investments which represent 51% of the GDP growth. (2.9 points 5.7 points.)

therefore failing to have a consumer spending enough to revive the economy, growth seems to have found a reciprocating engine .

One wonders if such a situation is sustainable and provides a solid base in the medium and long term. To do this we will look at all the figures in detail.

Table 1.1.1. Percent Change From Preceding Period in Real Gross Domestic Product
Residential: refers to housing.
Non Residential: refers to property other than housing, such as office buildings, shopping centers, industrial parks, churches and hotels.
The 1 st
table shows the percentage change compared to the previous period of each of the various items constituting the U.S. GDP. I highlighted in red and all the figures on which I wish to draw attention.
In the post
consumption we observe the following things:
 - Consumption of durable goods rose by 20.4% to -0.9% Q3 to Q4. 
- Consumption of nondurable goods increased from 1.5% to 4.3%.

In the position of Investment:
 -There is a jump in investment in the composition of GDP compared to the previous period from 5% to 39.3%.
-
 There is an increase in non-residential investment rising from 18.4% to 15.4%.
 There is a high-rise in investment in equipment and software. Unfortunately I did not find details this figure but it can not explain by itself the higher investment. It means that companies are investing in equipment and software is likely to reduce the blows or, hopefully, to launch research programs. In fact, U.S. production capacity falls far short of their highest so technically they do not need to invest in new equipment to support a claim that would be very high (demand remains very excited).

Table 1.1.4. Price Indexes for Gross Domestic Product


This graph shows that inflation is not zero but still low overall in 2009. Is observed over the year an overall increase in prices in the post consumption, exports, imports. However, there is a decrease in the price of investment with interest rates ranging between 0.15 and 0.25 point. But make no mistake only large companies have access to credit and thus investment. SMBs are in agony because otherwise there over the year 2009 a record contraction of credit, this phenomenon also continues to grow in 2010.
can even remarked, all medium-sized banks do not have access to credit or liquidity by the FED. Thus, for the year 2009 120 banks went bankrupt and since the beginning of 2010, 20 have suffered the same fate. (Out of 20 banks, a good portion had assets totaling over 1 billion dollars).


Table 1.1.6. Real Gross Domestic Product, Chained Dollars
Here is a table in constant dollars, that is to say, without taking into account the phenomenon of inflation. We observe that without increased investment in Q4, the U.S. GDP was unchanged in Q3. In the year 2009 we observe that GDP rose by 0.1 points.
This table is important because it highlights the importance of consumption in the U.S. GDP.
Thus the 4 th
quarter, we see that consumption is 9.298 trillion of the $ 13.155 trillion GDP. Thus all the speeches I have read as "Wall Street does not need to use his wealth "are absolutely false. The figures tell us that without consumption, the U.S. GDP would lead to a very severe decline.
In the 2 following tables detail I sought positions in the consumer investment. (The 1 st
for consumption, the second for investment)

Table 1.5.2. Contributions to Percent Change in Real Gross Domestic Product, Expanded Detail (1)
In the durable goods category: -
 This shows that consumption of American cars is declining in the composition of GDP fell to 0.81 -0.57 cons above. This is surprising given the measures of scrapping. One possible reason is the absorption of car market share by foreign automakers. (Especially Toyota which probably explains how hard she is a victim.)

 We see a very-low or stagnant durable goods related to housing in the composition of GDP. (Furniture, etc. ..)


In the category of non-durable goods: -
 There is an increase Non-durable goods in the composition of GDP increased by textiles and by the category called "other assets". We regret the lack of detail in this category represents a large part of the increase in nondurable goods in the compositions of GDP.


On services:
 - They are growing significantly due mainly to the position "of public goods and department of housing "and the posts of health. The change in services is mainly due to rise to positions or the State is very present.

Table 1.5.2. Contributions to Percent Change in Real Gross Domestic Product, Expanded Detail (2)

Residential: refers to housing.
Non Residential: refers to property other than housing, such as office buildings, shopping centers, industrial parks, churches and hotels.
 Regarding non-residential property, there was a significant rebound in the post GDP growth primarily driven by equipment and software as well as hardware and everything related to it.

 In contrast there was a decline in residential position in the composition of GDP compared to T3 may suggest that the fall real estate is certainly not finished.

 Finally on the trade balance of goods and services, there is an improvement in the composition of GDP due to the weakness of the dollar in Q4. However, this should not persist because of the collapse of the euro on 1 st
quarter 2010. In addition, the trade balance figures look very clearly overstated, it seems very likely to be revised down to 2 or 3 nd nd estimate.


Table 3.9.1. Percent Change From Preceding Period in Real Government Consumption Expenditures and Gross Investment

This table tells us that consumer spending and investment by the U.S. government are generally in decline (-0.2 in Q4 as against 2.6 in Q3). The savings were mainly made in the defense sector. The message for financial markets is that this is not the public demand that is responsible for the sharp increase in investment.

Conclusion: This recovery in Q4 is accompanied by a rise in unemployment outside, under normal circumstances, the U.S. unemployment has only quarter lag to the economic recovery. We do not observe this phenomenon here since the takeover was supposed to have taken place in Q3. Indeed, at the end of Q4 unemployment rate is 10% and 18% if one includes discouraged unemployed. Presumably there is a windfall for companies' policies of cost savings (replacement of human workers by computer equipment) taking advantage of low interest rates (just large companies, SMBs are unfortunately left to their fate and their failures do not diminish). The very low interest rates have the effect of making less expensive one additional unit of capital in relation to an additional unit of work. Therefore, for this reason that we observe an increase in investment in the composition of GDP but a parallel increase in unemployment, higher savings and lower consumption in the GDP composition. The recovery of the U.S. economy seems very fragile as highlighted in the Obama adviser, Larry Summers, who speaks of "a simple return statistics." Finally, finally, the figures seem clearly overestimated. It is therefore very likely to have once again a strong disappointment on GDP growth.


Alexandre Letourneau


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