GDP Estimates Crash on Dismal Economic Reports

-edited

GDP Estimates are well below 1.0% following industrial production and retail sales estimates.

The GDPNow model forecast for the fourth quarter took a dive today to 0.3% from 1.0% a week ago. Similarly, the Nowcast model fell to 0.4% from 0.7%.

Pat Higgins at GDPow explains:

"The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2019 is 0.3 percent on November 15, down from 1.0 percent on November 8. After this morning's retail trade releases from the U.S. Census Bureau, and this morning's industrial production report from the Federal Reserve Board of Governors, the nowcasts of fourth-quarter real personal consumption expenditures growth and fourth-quarter real gross private domestic investment growth decreased from 2.1 percent and -2.3 percent, respectively, to 1.7 percent and -4.4 percent, respectively."

Real gross private domestic development is now clocking at -4.4%.

Wow.

Recession Warnings

A bit ago I noted Industrial Production Dives and It's Not All Strike Related.

Trucking provide another recession warning: Freight Volumes Negative YoY for 11th Straight Month

Donald Broughton, founder of Broughton Capital and author the Cass Freight Index says the index signals contraction, possibly by the end of the year. That's just one one month away.

Strike Resolved

The GM strike is resolved. We will soon find out how much strike-related damage there was, but the risk is over-estimating the rebound going forward.

The trade deal with China is still unresolved.

Mike "Mish" Shedlock

Comments (15)
No. 1-12
AshH
AshH

The White House thought process: Hmmm, we need some positive news out there. I know... Let's float the idea that we're really close on a trade deal with China again! It's only been a couple of weeks since we said that the last time (I'm sure nobody remembers that anyway)...

Mish
Mish

Editor

Kudlow did just that!

Escierto
Escierto

Of course the stock market is up a half percent on this news. Buy! Buy! Buy!

Mish
Mish

Editor

shamrock
shamrock

Stock market is up, gold and bonds down. Go figure.

Tony Bennett
Tony Bennett

I'm not worried ... In Powell I trust (cough, cough)

Jerome Wednesday:

Looking ahead, my colleagues and I see a sustained expansion of economic activity, a strong labor market, and inflation near our symmetric 2 percent objective as most likely.

thimk
thimk

is just me ? just got back from WMART heavy discounts on UHD tv's. black friday sales seem to start earlier and earlier .

Casual_Observer
Casual_Observer

1% GDP is coming. The final GDP numbers have been higher than the GDP estimates of the Atlanta Fed. We will get a rate cut in late December or January.

Augustthegreat
Augustthegreat

Fake news report! Trade war is good and easy to win!

lol
lol

Economy that's dieing (dead)on the vines for a decade,kept (barely)resuscitated by zero rates and around the clock money printing to buy (prop up)well ….everything....while the bills pile up faster than snow on Mt Washington,not lookin good!

jivefive99
jivefive99

The Donald is not going to allow any bad news like this to be released. Appointees heading the Labor, Commerce and Treasury departments (and the Federal Reserve) know what their marching orders are: massage, massage, massage. Make those numbers look good, no matter what. The narrative of greatness and amazingness must continue. You watch.