It's The Economy Stupid: Mayans, GDP & Jobs

Why is it when we get to the end of our calendar we consider it an occasion to party, but when we get to the end of the Mayan’s calendar we think it could be the end of the world.  Please! To the Mayan’s December 21st was probably the functional equivalent of our December 31^st.  Perhaps they blew it out at the local jungle juice & mescal emporium (bar) on the 21st and just forgot to turn over the stone tablet to the new year.  I mean if they were really that good at forecasting the future don’t you think that maybe they could have foreseen the end of their own civilization and avoided it?  Wait!  They were probably the world’s first economists!!!  Anyway, just in case, it’s been real and it’s been good!  But I digress…

 

Economic Event	Period	Economic Survey	Actual Reported	Original Prior	Revised Prior
GDP QoQ Annualized	3Q T	2.8%	3.1%	2.7%
Personal Consuption	3Q T	1.4%	1.6%	1.4%
GDP Price Index	3Q T	2.7%	2.7%	2.7%
Core PCE QoQ	3Q T	1.1%	1.1%	1.1%
Initial Jobless Claims	DEC 15	360K	361K	343K	344K
Continuing Claims	DEC 8	3200K	3225K	3198K	3213K

 

Surprise!  Surprise!  GDP was not a Grinch!  U.S. Economy Grew 3.1% in Third Quarter, More Than Forecast

 

The U.S. economy grew at a 3.1 percent annual rate in the third quarter, more than previously reported, reflecting the first gain in state and local government spending in three years, more consumer purchases and

a smaller trade gap.  The revised gross domestic product reading exceeded the highest projection in a Bloomberg survey and compared with a previously estimated 2.7 percent gain. The median estimate of economists called for a 2.8 percent advance.  Projections from the 80 economists surveyed ranged from gains of 2.6 percent to 3 percent. NO ONE PREDICTED A 3.1% NUMBER!  Today’s figure marked the third reading for the quarter. The economy expanded at a 1.3 percent pace in the prior three-month period.

 

Okay, but let’s be real people!!!  We will hard-pressed to maintain that pace of growth this quarter as global demand cools and companies limit spending and hiring ahead of looming tax increases and spending cuts. While a stronger housing market will provide some cushion, the Federal Reserve is pursuing record stimulus aimed at driving bigger gains for the expansion.

 

The Initial Jobless Claims and the Continuing Jobless Claims came in just about as expected.  Initial Jobless Claims was at 361K, Continuing Claims at 3225K, both in line with economist’s estimates.

 

Here’s hoping there’s economic news to report tomorrow!

 

John Broussard

Assistant State Treasurer

Chief Investment Officer

State of Louisiana

Department of the Treasury