Biggest Inventory Build In History Prevents Total Collapse Of The US Economy

From the article:

“In other words, if US inventories, already at record high levels, and with the inventory to sales rising to great financial crisis levels, had not grown by $121.9 billion and merely remained flat, US Q1 GDP would not be 0.2%, but would be -2.6%.

Oh heck, just round it down to -3.0%


Q1 GDP in Context

–  Biggest Inventory Build In History Prevents Total Collapse Of The US Economy (ZeroHedge, April 29, 2015):

While we already observed that in Q1, US GDP rose by an appalling 0.2%, far, far below the consensus Wall Street estimate (in case you missed it, here again is the one thing every Wall Street economist desperately needs) and precisely in line with the Atlanta Fed forecast which we brought attention to in early March, confirming yet again that US stocks no longer reflect any fundamentals but merely Fed and global liquidity injections, there is something far more disturbing under the surface of today’s GDP report.

Inventories.

Specifically, the $121.9 billion increase in private, mostly nonfarm, inventories in the first quarter.

Cutting to the punchline, this was the biggest inventory build in history.

Change In Inventories

Another punchline: in Q1 2015, the US economy rose by a paltry $6.3 billion in nominal terms to $17.710 trillion.

Here is how the total GDP growth compares to just the increase in inventories, which as we wrote earlier this week, is the primary reason why the world is now gripped in a global deflationary wave.

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US Economy Grinds To A Halt, Again: Q1 GDP Tumbles Below Expectations, Rises Paltry 0.2%

US Economy Grinds To A Halt, Again: Q1 GDP Tumbles Below Expectations, Rises Paltry 0.2% (ZeroHedge, April 29, 2015):

And so the Atlanta Fed, whose “shocking” Q1 GDP prediction Zero Hedge first laid out nearly 2 months ago, with its Q1 GDP 0.1% forecast was spot on. Moments ago the BEA reported that Q1 GDP was far worse than almost everyone had expected, and tumbled from a 2.2% annualized growth rate at the end of 2014 to just 0.2%, in a rerun of last year when it too “snowed” in the winter.  This was well below the Wall Street consensus of a print above 1.0%.

US-GDP

In other words, in the quarter in which the S&P rose to unseen highs, the economy ground to a near halt.

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Propaganda Alert: “EU Exit Would Cost Britain Up To £215 Billion, German Study Predicts”

From the article:

“… the studies found the cost of a ‘Brexit’ would outweigh the benefits.”

Sure!

And better not take a look at what happened in Iceland and Greenland:

Why is Greenland so rich these days? It said goodbye to the EU!


brexit-cost

​EU exit would cost Britain up to £215 billion, German study predicts (RT, April 27, 2014):

A British exit from the European Union could cost the UK billions of pounds, a report published by two German institutes predicts.

The study by Bertelsmann Stiftung and Ifo Institute calculates if the UK leaves the EU the country could lose 14 percent of its GDP – equivalent to £215 billion.

Germany and other EU member states would also lose out financially, although not as much as Britain.

Even if Britain was successful in negotiating a trade agreement with the EU, the studies found the cost of a ‘Brexit’ would outweigh the benefits.

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We’ve Crossed The Blutarsky Line … And Have Been In Recession Since At Least December

“GDP Now” Reaches Blutarsky Average (The Burning Platform, April 2, 2015):

We’ve been in recession since at least December. Retail sales, which account for 67% of GDP have sucked for the last four months. Obamacare spending is the only thing that kept the 4th quarter GDP from being negative. Factory orders have crashed and it is clear to anyone with a functioning brain (disqualifies politicians, CNBC bimbos and boobs, and Ivy League trained economists) we are in recession. We’ve crossed the Blutarsky line.

Factory Orders Fed_1_0

GDP Now in Dangerous Waters

The Atlanta Fed has posted today that its GDP Now measure has reached exactly the same level as a certain Mr. John Blutarsky’s mid-term grade average. This is to say, it has declined to 0.0%.

gdpnow-forecast-evolution

GDP Now goes Blutarsky – via Atlanta FED

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NFIB Chief Economist Warns “Bubble In US Net Worth Has Reached Unsustainable Heights”

NFIB Chief Economist Warns “Bubble In US Net Worth Has Reached Unsustainable Heights” (ZeroHedge, March 4, 2015):

“The relationship of U.S. net worth to GDP appears to have reached unsustainable heights,” warns NFIB Chief Economist William Dunkelberg, adding that a massive decline in the value of assets is “more likely” than a massive increase in GDP. Logically this seems unavoidable, unless you believe that we are truly wealthier now, even with an economy that is delivering a rather poor performance (historically weak output and sales growth) in real terms. It would seem not to be ‘whether’ we will adjust but when.

GDP Shocker: Atlanta Fed Calculates Q1 Growth Of Only 1.2%

GDP Shocker: Atlanta Fed Calculates Q1 Growth Of Only 1.2% (ZeroHedge, March 3, 2015):

While every other word from talking-heads and policy-makers relates various anecdotes (or simple lies) about US economic growth, The Atlanta Fed appears to have taken a ‘data-dependent’ perspective on the real economy (as opposed to smoke and mirrors). Based on their GDPNow “nowcasting” model, The Atlanta Fed projects Q1 2015 GDP growth os just 1.2% (less than half current sell-side economist consensus) and getting weaker…

Global Debt Is MORE THAN TWICE AS BIG As the Entire World Economy … What Does It Mean?

Related info:

This Is The Biggest Problem Facing The World Today: 9 Countries Have Debt-To-GDP Over 300%


Global Debt Is MORE THAN TWICE AS BIG As the Entire World Economy … What Does It Mean? (Washington’s Blog, March 3, 2015):

Global Debt Is Almost 3 Times As Big As the World Economy

The Guardian reports that global debt has grown by $57 trillion dollars – to $199 trillion dollars – since the 2008 financial crisis.

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The Global Death Cross Just Got ‘Deathier’

The Global Death Cross Just Got “Deathier” (ZeroHedge, Feb 19, 2015):

“X” continues to mark the spot of the death of global investor rationality…

19 “policy easings” since the start of the year have surged global equity prices to record highs but has sent expectations for global GDP growth to cycle lows…

Global Death Cross

 When does the foundation of faith in central planners start to break?

The Last Time This Happened, US GDP Crashed By 5%

The Last Time This Happened, US GDP Crashed By 5% (ZeroHedge, Feb 16, 2015):


The last time US weather was this bad, annualized US GDP crashed from 2.3% to -2.9%.

Or perhaps this time will be different, and the laughable cadre of propaganda sycophants known as tenured and/or Wall Street economists finally admits that cold weather in the winter had nothing to do with the economic plunge a year ago, and everything to do with the fact that when it comes to integrity and accuracy of economic data and estimations, the US now ranks pari passu with the Chinese department of truth?

Unless, of course, just like last year economists discover that it was “really cold” post hoc once again, and none other than the Fed decides to blame, drumroll, the weather for crushing its best laid plans (of central planners and men) to hike rates some time in the summer of 2015.

David Stockman: The Global Economy Has Entered The Crack-Up Phase

David Stockman: The Global Economy Has Entered The Crack-Up Phase (PeakProsperity, Feb 15, 2015):

Few people understand the global economy and its (mis)management better than David Stockman — former director of the OMB under President Reagan, former US Representative, best-selling author of The Great Deformation, and veteran financier.

David is now loudly warning that events have entered the crack-up phase, which he predicts will be defined by the following 4 developments:

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Thanks Obamacare: This Is What Americans Spent The Most Money On In Q4

Obamacare

– Thanks Obamacare: This Is What Americans Spent The Most Money On In Q4 (ZeroHedge, Jan 30, 2015):

If readers need clarification on what was the primary source of spending-based “growth” for the US economy in the fourth quarter, the same source that bumped up final Q3 GDP from 3.9% to 5.0%, please ping us: we will gladly explain the chart below.  And just in case it is still unclear what Americans are spending their “gas sasvings” on, here it is one more time.

Q4 spending GDP

And just in case the fading impact of Obamacare is not already priced in, here is what Q4 inventories did: rising by $113.1 billion in Q4, this was the second highest quarterly increase in the 21st century, second only to September 2010. It’s all GDP-crushing liquidations from here.

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Brazil’s Economy Just Imploded

Brazil’s Economy Just Imploded (ZeroHedge, Dec 29, 2014):

China may have mastered the art of fabricating economic data to a level unmatched by anyone except the US Department of Labor, but its derivative countries have much to learn. And none other more so than one of China’s favorite sources of commodities over the past decade: Brazil. It is here that things are going from worse to catastrophic, as disclosed in today’s update of Brazil’s fiscal picture.

Here are the disturbing facts showing that behind the world’s propaganda growth facade, it is all hollow: Brazil’s consolidated public sector primary fiscal balance, which posted a significantly worse than expected R$8.1bn primary deficit in November driven by the R$6.7bn deficit of the Central Government, dipped into negative territory: -0.18% of GDP, driven by the significant deterioration of the Central Government finances.

Here Is The Reason For The “””Surge””” In Q3 GDP

From the article:

“In short, two-thirds of the “boost” to final Q3 personal consumption came from, drumroll, the same Obamacare which initially was supposed to boost Q1 GDP until the “polar vortex” crashed the number so badly, the BEA decided to pull it completely and leave this “growth dry powder” for another quarter. That quarter was Q3.”


Here Is The Reason For The “Surge” In Q3 GDP (ZeroHedge, Dec 23, 2014):

Back in June, when we were looking at the final Q1 GDP print, we discovered something very surprising: after the BEA had first reported that absent for Obamacare, Q1 GDP would have been negative in its first Q1 GDP report, subsequent GDP prints imploded as a result of what is now believed to be the polar vortex. But the real surprise was that the Obamacare boost was, in the final print, revised massively lower to actually reduce GDP!

This is how the unprecedented trimming of Obamacare’s contribution to GDP looked like back then.

Healthcare Contribution

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America’s Next Economic Bonanza: Bigger Butts

Hopeless!


Brazilian butt lift

America’s Next Economic Bonanza: Bigger Butts (ZeroHedge, Nov 11, 2014):

The U.S. booty business is getting a big bump, as AP reports companies are cashing in on growing demand from women seeking the more curvaceous figures of their favorite stars. While Millennials may spend most of their day sitting on their Minaj-esque “big fat butts” playing Kardashian, the business of boosting butts is bursting. From padded panties and gym classes that promise plumper posteriors to the “Brazilian butt lift,” in which fat is sucked from a patient’s stomach, love handles or back and put into their buttocks and hips, French sociologist Jean-Claude Kaufmann says “there’s a trend to show off the buttocks in place of breasts due to the rise of Beyonce,” Jennifer Lopez, and more recently Meghan Trainor. The bottom line – butt lifts and implants are the fastest growing plastic surgery, helping GDP at a cost of $10-13k each.

As AP reports,

Gym classes that promise a plump posterior are in high demand. A surgery that pumps fat into the buttocks is gaining popularity. And padded panties that give the appearance of a rounder rump are selling out.

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Global Commodity Prices Are Collapsing At The Fastest Pace Since Lehman

Global Commodity Prices Are Collapsing At The Fastest Pace Since Lehman (Zerohedge, Nov 5, 2014):

Nothing to see here, move along…

We are sure it’s nothing to worry about, and in now way indicative of any global aggregate economic weakness, but global commodity prices (that would be the ‘stuff’ that is used to make the ‘stuff’ we all buy every day) are collapsing at the fastest rate since Lehman…

Global Commodity Prices Are Collapsing At The Fastest Pace Since Lehman

Of course, it’s all about over-supply, not under-demand… just like the Baltic Dry was not low because of shitty trade volumes but because of too many ships… but it’s just the other side of an uncomfortably real mal-investment-driven fiasco…

As the chart below shows… maybe it is the economy stupid and with US GDP expectations being ratcheted down after construction spending and trade deficit data, maybe the US is not decoupling after all.

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Interest Rates Cannot Rise And Here’s Why …

Interest Rates Cannot Rise and Here’s Why… (Frist Rebuttal, Nov 3, 2014):

I wrote an article recently over at Voices of Liberty that lays out the very dire picture for those of us who have yet to retire.  The gist of the article is that the Fed has effectively robbed the retired class of any hope for having enough of a nest egg to live off through the end of their lives if they want to retire at 65.

Some may argue well this past 10 years has just been an anomaly of low interest rates but they will come back i.e. normalize to higher levels here in the next couple years.  Well let me show you why that is simply wrong.

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Kudos To Bundesbank President Jens Weidmann For Uttering Three Truths In One Speech

Kudos To Herr Weidmann For Uttering Three Truths In One Speech (David Stockman’s Contra Corner, Oct 17, 2014):

Once in a blue moon officials commit truth in public, but the intrepid leader of Germany’s central bank has delivered a speech which let’s loose of three of them in a single go. Speaking at a conference in Riga, Latvia, Jens Weidmann put the kibosh on QE, low-flation and central bank interference in pricing of risky assets.

These days the Keynesian chorus in favor of policy activism is so boisterous that a succinct statement to the contrary rarely gets through – especially at Rupert Murdoch’s Wall Street yarn factory. But here’s what penetrated even Brian Blackstone’s filters:

“The biggest bottleneck for growth in the euro area is not monetary policy, nor is it the lack of fiscal stimulus: it is the structural barriers that impede competition, innovation and productivity,” he said.

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Sex, Drugs And … Hookers And Dope Bring Italy Out Of Recession

Reality is still the same, only the GDP figures are different.

Mission accomplished!


hookers-drugs-italy-recession

Sex, drugs and…Hookers and dope bring Italy out of recession (RT, Oct 15, 2014):

Illegal economic activities such as drugs and prostitution are apparently responsible for having lifted Italy out of economic recession. EU data calculations have demonstrated that the black market has significantly boosted GDP figures.

Italy is technically no longer in economic recession because of the addition of figures from illegal activities.

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The “Growth Problem” Explained For Idiots And Federal Reserve Dummies

The “Growth Problem” Explained For Idiots And Federal Reserve Dummies (ZeroHedge, Oct 10, 2014):

Over the past six years we have tried, in a countless number of ways, to explain to the “wise” economists, IMFers, World Bankers, Federal Reservers, talking heads and everyone else who would rather not listen, that which is glaringly obvious: the US (and global) economic growth will never recover and rebound and in fact will decline with every passing year for one simple reason – the US (and global) debt bubble is bigger than ever.

In fact, at 300% total debt/GDP it is bigger than the 275% hit during the Great Depression (we doubt we need to remind readers what global event ended that particular time in US history).

So, in hopes there is still some intelligent life left among the decision makers, and in hopes of liquidating the record debt overhang before it is too late and the US has to engage in another deadly, global war, here it is again:

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