The Accidental Economist with Jack Kern: Negative GDP and I’m Smiling
- May 29, 2015
Don’t know much about history
Don’t know much biology
Don’t know much about a science book
Don’t know much about the French I took
—Wonderful World ©SamCook 1960
The GDP numbers were revised downward to show that the 1st quarter is negative under 1 percent, effectively muting a prior announcement by the Bureau of Labor Statistics. While this wasn’t unexpected, it does unleash a firestorm of potent worry and discord among the economic cognoscenti about the future of 2015. I’m fond of reminding people that GDP is composed of several thousand data series and that given it represents the sum total of the output of the United States with some international flavors, it is often misquoted and used to justify everything from federal budget constraints and reserve policies to how much junior is getting for his allowance. (Clever little guy watches the news too).
I’ve taken a look at the GDP numbers, with great interest I might add, and this assures you that no one will talk to me at the cocktail party. While being the dull GDP guy, I do take great solace in understanding how all the pieces of this greater fool, economic underpinning, Federal Reserve sham of a policy work. And to that I say to real estate owners, be happy you have hard assets. People in apartments are not going to flee to the hills and retailers are not going to see sales decline. Rather the economy is still on firm ground and growing, not receding. While the numbers suggest a decline, most of the sectors in the GDP calculations did ok enough to remain positive. And that is cause to smile, or at least frighten my cardiologist while I hoist a candy bar to the sky and thank the cloud (it’s all in the cloud now isn’t it) for our good fortune.
Don’t know much about history started a song popularized in 1960 is really about the certainty in life. And after roughly 55 years (don’t write to me, that’s close enough to the actual release date for all you vinyl owners), the message still rings true. And in the process of following fed statistics all these years, I’ve come to accept the frailty of no news is good news. Sometimes just the opposite is true.
Jack Kern is currently working in Cluj, Romania, as the third round draft pick of the Transylvanian Film Goers Society. When he’s not watching movies in foreign countries he spends his time as the publisher and research editor of Multi-Housing News and Commercial Property Executive. We’re happy to have his dispatch from the front.