Posted on 10/29/2004 5:30:37 AM PDT by RWR8189
It was one of the final pieces of economic data before Tuesday's U.S. presidential election in which the economy's condition has been a focal point, and indicated generally that a solid expansion remains in place.
Consumer spending, which accounts for about two-thirds of economic activity, increased at the fastest rate in a year while a price gauge that is favored by Federal Reserve Chairman Alan Greenspan (search) — the index of personal consumption expenditures minus food and energy — barely increased at a 0.7 percent rate. That was the smallest gain in this price measure in nearly 42 years, since a 0.5 percent rise in the fourth quarter of 1962, department officials said.
Just in case people don't think the rest of the world is tanning our hides on the economic front...
"Growth rates for 2004 - projected to reach 2.1 per cent in the eurozone and 2.5 per cent in the EU [Ed.: Those are annualized %s] - are exceeding expectations, supported by "the continued buoyancy of global growth and trade", says the EU executive ."
EU cuts 2005 growth estimates - 10/27/04
Note date of the PR release.
I think the naysayers forgot the effects of four hurricanes that hit the southeastern USA this year, which caused US$35 billion in damage. Small wonder why the third quarter GDP growth was only 3.7%, mostly because many businesses in the US Southeast had reduced economic activity due to being affected by the hurricanes.
The economy went into recession in my view in Q3 2000, just like Bush and Cheney were warning back then.
IIRC, the preliminary figures near the election shows very small growth, something like 0.3%. Subsequent revisions showed the actual decline.
"LESS THAN EXPECTED GROWTH",,,or "DISAPPOINTING GROWTH".
Heading before the election is the usual way of the media to debase our President.
this is great news! i would fire the economists who predicted a higher number. if i was off by that much on a consistent basis, i would be in a soup line right now.
Once the 'EXPECTATIONS' game is set,,,you MUST meet expectations--or it is 'spinned' the other way.
Stock prices work the same way when a company exceeds earnings of a prior quarter (or the same quarter a year earlier)--if they don't meet EXPECTATIONS--the stock takes a hit!
i understand that the economist errors have been bi-partisan. however, reality is reality. the real question is why are the "expectation setters" so wrong? they are the ones that should be called out on the carpet, not the president. the increase is still great news.
comparing this to the stock market is an apples to oranges comparison, however. i thoroughly agree with what you have said, but the market is driven by profits (corporate efficiencies to those of you business haters out there) and psychology. many investors have much "skin in the game" in this case. in the above case the only skin people are going after is george bush's.
The EXPECTATIONS GAME is a perfect analogy to the stock market,,,,,just like it's a perfect analogy to debates,,,or anything else (even marriage......lol) where EXPECTATIONS are set ahead of time.
i understand what you are saying and i agree that is how things are. but i do like to p!ss into the wind sometimes and see what happens. i am suggesting a paradigm shift. let's get better forecasters.
let's say i run a manufacturing facility. the market is demaning X number of units and my boss wants X, but i tell my boss that only .8X can be delivered. in fact, due to the creativeness of my managers and dedication of my workers, .9X are delivered. the company still makes a profit, i exceed my expectations, but my boss's expectations are unmet. who should be taken to the woodshed, me, or my boss?
Again,,,the EXPECTATIONS GAME!!
It is an expectations game. but you did not address whose expectations are the correct ones. that is why i posed the question to you that you chose to not answer. my expectations were exceeded, but my bosses were not. who gets called on the carpet -- me for not getting X units out, or my boss, for stating that X units would be delivered?
Your analogy does not address the "GROUP EXPECTATIONS" of politics or the stock market!! Geeez
Pretty good that there was this much growth -- oil.
yes it does. ok, let's add an environment. X units were not delivered, so the profits were down 5%. does that provide enough information to enable an answer?
If GROUP EXPECTATIONS were for a 10% drop in profits,,,,and the drop was only 5%....the stock market would probably respond positively to that stock.
I'm not wasting any more time on this,,,,if you can't understand the EXPECTATIONS game,,,,you should be on DU!! Have a nice day....:)
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.