At this point, much of this has just become humorous...
remember when the market rallied on better than expected 3.5% GDP? Somehow we believe the government can actually measure a $14 Trillion economy within weeks of a quarter end, something laughable for anyone with any level of sense.
But no matter... 3.5% GDP it was, and it was time to run the market up. Even if the economists who follow these things suggested that half the increase was due to Cash for Clunkers. But no worries about details such as that.
Then a few weeks ago, this number was (wait for it) revised downward.... to 2.7%. As has been the status quo from government, somehow all their figures come in higher on the first revision when everyone pays attention, then are almost always revised downward later, when people have moved onto the next thing.
Well, we have another revision this morning and it's down to 2.2%. Considering about 1.7% of the original 3.5% of GDP was due to Cash for Clunkers, and a few hundred billion of other stimulus was pushed into the economy my various programs, you can do the math.
Does any of this matter in our Alice in Wonderland existence? No, not really. The market is not about reality, but our perception of reality. If you borrow a few trillion from our grandchildren and chuck it at the economy you can create any GDP number you want. But even by doing so, we have some quite pathetic growth figures, especially considering after most major drops in GDP in the past you had huge rebounds (i.e. 6%+ GDP) under the guise of the harder you fall, the larger the bounce.
This time? If you believe the government can somehow measure an economy... the -6% GDP figures we enjoyed last year at this time have led to a +1.8% (first try), +1.0% (second try), +0.5% GDP (chock full of housing handouts and stimuli) ex Cash for Clunkers.
Oh well, it's time to forget about it anyhow as its backwards looking and prepare to repeat the entire game over for Q4 2009 GDP, in the coming weeks. Just be ready to clap like seals at whatever we hear because surely the first revision will be both accurate and worthy to move trillions of stock market value.