The second quarter Gross Domestic Product growth result will be released tomorrow. The Q2 GDP growth rate is historically the worst quarter of the year. A growth rate higher than 1.5 percent will be a strong indicator the U.S. economy remains on track for a cumulative year of around three percent.
In the latest economic releases the orders for durable goods “unexpectedly” jumped in June [2 percent], again indicating the overall strength of the U.S. economy and strong consumer purchasing. Additionally the trade in goods deficit “unexpectedly” declined 1.2 percent in June as more manufacturers “surprisingly” shift production back to the U.S, and domestic consumers are “unexpectedly” loyal to USA.
Every economic indicator is positive, and each series of released data shows the U.S. economy is increasingly strong. Despite the empirical data, media reporting on economic forecasts continue to convey a negative slant disconnected from what is happening.
WASHINGTON (Reuters) – New orders for key U.S.-made capital goods surged in June, suggesting some improvement in business investment, but economic growth is still expected to have slowed sharply in the second quarter amid weaker exports and a smaller inventory build.
Still, the longest U.S. economic expansion on record remains supported by a strong labor market. Other data on Thursday showed the number of Americans filing claims for unemployment benefits dropped to a three-month low last week.
The economy has been hurt by the U.S.-China trade war and slowing growth overseas. These factors are expected to encourage the Federal Reserve to cut interest rates next Wednesday for the first time in a decade.
The Commerce Department said orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, jumped 1.9% last month after rising 0.3% in May.
Orders for these so-called core capital goods in June increased across the board, with demand for machinery rising by the most in nearly 1-1/2 years. Economists polled by Reuters had forecast core capital goods orders would gain 0.2% in June.
“The stronger-than-expected orders are a positive sign that business investment and manufacturing sector activity have not weakened substantially further following softness earlier in the year,” said Veronica Clark, an economist at Citi in New York.
Core capital goods orders rose 1.9% on a year-on-year basis. Core capital goods shipments, which are used to calculate equipment spending in the government’s gross domestic product measurement, increased 0.6% in June after advancing 0.5% in the prior month.
[…] Overall orders for durable goods, items ranging from toasters to aircraft that are meant to last three years or more, increased 2.0% in June, the most since August 2018, after declining 2.3% in the prior month. Unfilled orders fell for a second straight month. (read more)
Way to go President Trump and American workers!
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Saw the Economic Indicator Poll today. For Small Business it’s the highest since 2001!!!!
Maganomics in action.
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To quote our Lion
“Relax, I got this…”
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Indeed, Raptor. 😎
I remember these numbers being batted around shortly after our President took office, and I marveled that we dared even say them out loud. Now we are living them, and then some. We are monumentally blessed with this President. The mere thought of anyone else in the White House makes my blood run cold. Thank you, President Trump!
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We certainly are living in an era where any reporting from any mainstream source needs to be taken very skeptically and with a grain of salt. The Reuters article displayed must have been written by somebody schooled by Orwell. Positive indicators actually reported throughout the article, but always accompanied by some manner of negative spin.
Thank you Sundance for always showing us the caveats of these purposely-deceptive mainstream articles that see to deflect from the truth and the enormous success being enjoyed from Trump’s economic agenda and policies. Someone please tell me where the “trariffs” are having a significantly detrimental effect on the economy.
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spren: “We certainly are living in an era where any reporting from any mainstream source needs to be taken very skeptically and with a
grainblock of salt. “Not to be the Grammar Nazi type, but you had a typo in there ;o)
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China
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My guess is 2.4% or better.
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I wonder how much the Boeing 737 MAX is affecting the total US numbers. It is certainly hurting Export numbers.
Bad Code – and cheap foreign testers – can be costly.
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I thought Q1 was the toughest quarter?
Not trying to be an “Eyeore” – I think generally the economy is doing great – but I thought I read about a dip in manufacturing, and real estate having some bumps?
Also curious, I thought the official GDP number for 2018 was 2.9%, Sundance yesterday said 3.1%?
Any way you slice it, double the 1.5% GDP Obama left us with his last 6 quarters.
Pass USMCA!!
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I read someone from Canada calling USMCA as “CUSMA”. Is tha right?!
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CNBC: Why is the economy always so weak in the first quarter? Nobody really knows
April 24, 2015
“Over the past 30 years, first quarter growth has been by far the weakest of the four, averaging just 1.87 percent while the economy has grown 2.7 percent, according to the CNBC analysis. Several economists contacted by CNBC said if data were properly adjusted for seasonal variables, such a difference would not show up over a three decade span. They all found the results statistically significant.”
https://www.cnbc.com/2015/04/21/the-mysterious-case-of-weak-1q-gdp-for-30-years.html
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My guess, and it’s only an observational guess, is that the US has so many public holidays in the last quarter of the year (Thanksgiving, Xmas, New Years eve etc) where people spend a lot of money, that people tighten up over the next few months, which would be the 1st Q of the new year.
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Also, if you ever worked with the government, they are basically out to lunch from mid November until mid January. Imagine all the purchase orders, contracts, and other deals not being made while literally tens of thousands of low to mid level people with purchasing authority are coasting through the holidays.
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This is the title from a recent wonky Alan Tonelson blog. The article and details make my eyes fog over. Ugh.
“(What’s Left of) Our Economy: Just When Did U.S. Manufacturing’s Current Recession Begin?”
I believe he said 2018 was good for manufacturing, and 2019 is off. Like I said, makes my eyed fog.
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Right they are doing same crap about global warming or climate change always pushing a false set of data . Filthy hearted sinners do not fear God’s judgment or desire His approval .
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I’m still waiting on that recession that was supposed to be here by now. I was really looking forward to my husband having no job prospects and us greeting each bill with fatalistic resignation instead of mere dread, contemplating how best to deal with homelessness rather than figure out ways to make our income stretch to cover everything until our income increases.
/s
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I like the strong supposition in the article that the,FED will finally DROP interest rates.
“Lets overlook the fact your LATE to the party, and just focus on the fact you showed up at all!”
About FREAKIN TIME! Another that deserves the “enemy of the people” moniker.
None of those “unnexpected” and “surprisings” would have been in the article, if they judt read Sundance.
Only thing slowing down the train, is the FED and the FLOOD. And even with that, the train is too powerful.
Choo, choo!
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Over 27 months, nine quarters, from Dec-16 to Mar-2019, U.S. GDP compounded @ 2.817% per annum vs. Gangrenous’ 8-year rate of 1.829% PA, an extraordinarily positive 1.540 : 1 proportion.
Though 2nd Quarters are historically a year’s low-point, Trump Prosperity registered 3.00% PA in 2-Qtr-17, a historic 4.20% PA in 2-Qtr-18. Conventionally, “anything exceeding 1.5% PA” will be considered positive.
On this basis, discounting our 2-1/4 year estimate of 3.004% PA by 25%, we derive a Cloud Nine figure of 2.25% PA for 2-Qtr-2019. By noon today (Friday, July 26th), it’ll be interesting to see how this objective, historical projection conforms to bureaucrats’ $multi-million Commerce Dept./BLS “expectations”.
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The economic article from AP is written to sound negative while posting very positive news.
N.B.; AP insinuates that “core capital goods” is a suspect term, which it is not.
AP then states the very positive “core capital goods” improvement while simultaneously using unknown “Economists” to posit a weak economic “core capital goods” number.
AP claims that exports will be a weaker number.
Yet, the U.S.-China trade war has not been the disaster predicted by many economists.
Impacts to China’s and Southeast Asia’s pork supply will cause those countries, especially China, to import greater amounts of pork and likely soybeans.
Moral: Don’t trust prognostications, especially those that are based upon TDS influences.
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The reason that the MSM & Wall Street economic numbers keep missing how fast the US Economy is growing boils down to the growth in American energy export infrastructure for oil and Natural gas due to Trump Administration policies which is utterly invalidating the economic models they use.
See my post here:
Our ‘Xanatos Gambit’ President’s Energy Export Strategy Tree
Posted by Trent Telenko on 5th May 2019
https://chicagoboyz.net/archives/59712.html
“While the media was spending a great deal of time talking about things like the Congressional votes to open the Arctic Wildlife Refuge in the early days of the Trump Administration’s energy policy implementation. President Trump spent a great deal of his early political capital on getting his earliest political appointments through the Senate to the FERC to get those projects turned loose as a part of President Trump’s “Global Energy Dominance” export policy. The first fruit of this export infrastructure energy policy focus started paying off with the Louisiana Offshore Oil Port (LOOP) coming on-line in 2018. See this Apr 16, 2019 article by Julianne Geiger at Oilprice.com:
U.S. Doubles Oil Exports In 2018
(https://oilprice.com/Energy/Energy-General/US-Doubles-Oil-Exports-In-2018.html)
>>The United States nearly doubled its oil exports in 2018, the Energy Information
>>Administration reporting on Monday, from 1.2 million barrels per day in 2017.
>>
>>The 2.0 million barrels of oil per day exported in 2018 was in line with increased
>>oil production, which averaged 10.9 million barrels per day last year, and was
>>made possible by changes to the Louisiana Offshore Oil Port (LOOP) which
>>allowed it to load VLCCs (Trent Note: Very Large Crude Carriers) .
>>
>>The changes to LOOP and to the sheer volume of exports were not the only
>>changes for the US crude oil industry. The destination of this oil shifted in 2018
>>as well, and even shifted within the year as the trade row between China and the
>>United States took hold.
>>
>>Overall, Canada remained the largest buyer of US oil in 2018, at 19% of all oil
>>exports, according to EIA data. During the first half of 2018, the largest buyer of
>>US crude oil was China, averaging 376,000 barrels per day. Due to the trade row,
>>however, US oil exports to China fell to an average of just 83,000 barrels per day
>>in the second half, after seeing zero exports to China in the months of August,
>>September, and October.**
>>
>>[**Please note above the nice thing about energy exports is how futile a energy
>>user embargo is against it. China’s economic embargo of US crude products
>>only hurt itself.]
The impact of the Trump Administration’s energy export policies from those early days of his administration in terms of liquefied natural gas (LNG) export facilities are now impacting the American economy. A large part of the extra 0.7% GDP growth achieved over the 2.5% Wall Street forecasts in the first quarter of 2019 came from the Corpus Christ 1 and Sabine 5 LNG export facilities coming on-line in late 2018 and making their first full export capacity quarter in Jan – Mar 2019. The Cameroon 1 and Elba Island 1-6 LNG export facilities were also scheduled to come on-line in Late Feb-Early March 2019, and were very likely large contributors to LNG export surge.
The impact of the Trump Administration’s energy export policies from those early days of his administration in terms of liquefied natural gas (LNG) export facilities are now impacting the American economy. A large part of the extra 0.7% GDP growth achieved over the 2.5% Wall Street forecasts in the first quarter of 2019 came from the Corpus Christ 1 and Sabine 5 LNG export facilities coming on-line in late 2018 and making their first full export capacity quarter in Jan – Mar 2019. The Cameroon 1 and Elba Island 1-6 LNG export facilities were also scheduled to come on-line in Late Feb-Early March 2019, and were very likely large contributors to LNG export surge.”
There is a key fact that the Wall Street/MSM models seem to be missing in the current economy.
Energy prices are “high” (oil at $70 a barrel) and the US Economy is BOOMING.
In the late 1970’s oil at $35 a barrel ($120 in today’s dollars) drove the US economy into a deep recession everywhere save the oil patch in Texas, Oklahoma and Louisiana.
What the Frac’ing revolution has done is greatly expand the size of the “oil patch” such that the net effect of higher oil prices now increased the net American economic growth.
This is unprecedented…and a direct policy effect of the Trump Administration’s pro-energy export infrastructure decisions.
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Reuters expectedly reports unexpectedly…. as usual.
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