The Logic Lifeline

A logical approach to sorting out world events. Where logic, opinion and speculation are combined to produce a reasoned, but entertaining reading experience. The unofficial hometown conservative blog of Woodridge, Il

Thursday, May 25, 2006

It just does not get any clearer than this

For those who don't visit hughhewitt.com often, Mary Katherine Ham co-posts quite frequently. Today, she posted on a Dow Jones Newswire article that shows good economic news after good economic news. I don't usually do this, but to get the full flavor of all the good economic news here is a copy of the story with bold emphasis added by Ms. Ham to drive the point home:
WASHINGTON (Dow Jones)--The U.S. economy opened the year with more vitality than first thought, driven by stronger inventory building and overseas sales.

Gross domestic product increased at a 5.3% annual rate January through March, the Commerce Department said Thursday in its first revision to first-quarter 2006 GDP. The government initially estimated growth at 4.8%.

Price inflation estimates were left largely untouched.

The report showed corporate profits after taxes climbed 8.8% to $1.155 trillion January through March from the last three months of 2005. Profits increased 13.8% in the fourth quarter. Year over year, profits climbed 24.8% since the first quarter of 2005.

Raised projections on inventory building and exports were behind the upward revision to GDP, which is a measure of all goods and services produced in the economy.

The 5.3% seasonally adjusted gain in GDP was much bigger than the fourth quarter's 1.7% push forward, and marked the strongest quarterly showing since third-quarter 2003, when GDP raced ahead at a pace of 7.2%.

Still, Wall Street expected faster growth of first-quarter GDP; the median estimate of 23 economists surveyed by Dow Jones Newswires and CNBC was a 5.8% increase.

The revisions released Thursday showed business inventory building was stronger than first assumed. Stockpiles rose by $32.3 billion; originally, Commerce estimated a $21.9 billion increase. Companies had elevated stocks $37.9 billion in the fourth quarter.

The accumulation of goods subtracted only 0.14 percentage points from first-quarter GDP. Originally, Commerce said inventories cut 0.52 percentage points off GDP.

Businesses increased spending a little less than previously thought. Outlays rose 13.1% January through March, lower than the originally estimated 14.3% advance. Business spending rose 4.5% in the fourth quarter. First-quarter investment in structures climbed 11.3% and equipment and software increased 13.8%.

First-quarter spending by consumers rose 5.2%, down from a previously reported 5.5% but way above the fourth quarter's 0.9% advance.

Consumer spending accounts for the lion's share of economic activity - about two-thirds. It contributed 3.63 percentage points to GDP in the first quarter; the original estimate was a contribution of 3.81 percentage points.

Purchases of durable goods surged 20.5% in January through March, a bit down from a previously reported 20.6% but far stronger than October-through-December's 16.6% tumble.

Durable goods are expensive items designed to last at least three years, such as cars.

First-quarter non-durables spending rose by 5.7%. Services spending went 2.2% higher.

Trade exerted less of a drag on GDP, according to the revised data. U.S. exports rose by 14.7%. Imports increased 12.8%. Originally, exports were seen up 12.1% and imports 13.0% higher. Fourth-quarter exports increased by 5.1% and imports surged 12.1%. Trade lopped 0.55 percentage points off GDP in the first quarter; initially, Commerce said trade reduced GDP by 0.84 percentage points.

Residential fixed investment, which includes spending on housing, climbed by 3.1% in the first quarter, higher than the originally estimated 2.6% rate of growth. Fourth-quarter spending went up 2.8%.

Real final sales of domestic product, which is GDP less the change in private inventories, climbed 5.5%. The original estimate was a 5.4% increase. Fourth-quarter sales fell 0.2%.

Federal government spending increased by 10.5%, revised down from an initially estimated 10.8% increase. Fourth-quarter spending fell 2.6%. State and local government outlays increased 0.8%.

The government's price index for personal consumption rose 2.0%, unchanged from the previous estimate for the quarter and below the fourth quarter's 2.9% climb. The PCE price gauge excluding food and energy increased 2.0%, the same as the previous estimate for the quarter and below the fourth quarter's 2.4% climb.

The price index for gross domestic purchases, which measures prices paid by U.S. residents, rose 2.8%, up from the previous estimate for the quarter of 2.7% but below the fourth quarter's 3.7% climb. The chain-weighted GDP price index rose 3.3%, the same as the previous estimate for the quarter but below the fourth quarter's 3.5% climb.


Ms. Ham quips at the end that the author 'had to whip out a thesaurus to figure out more ways to say "increased." '

Ok, so all of this amazing news and what is the point besides where is the MSM on all of this news? The point to her post is the headline chosen for this piece:
US 1Q GDP Revised At Rate Below Expectations
You might need to get out your manifying glass to find the following which is the inspiration behind the underwhelming title:
Still, Wall Street expected faster growth of first-quarter GDP; the median estimate of 23 economists surveyed by Dow Jones Newswires and CNBC was a 5.8% increase.
We have seen the MSM dodging and ducking great economic news. We have seen the MSM continue to scrounge for bad news whenever they have to report good news. We have seen Greenspan and Buffet taking every chance to try to sink the housing market. And of course we have seen the MSM try every trick to spin good economic news into bad. This one, however, really takes the cake.

11 Comments:

  • At 11:52 PM, Anonymous r2w said…

    Unfortunately, about 50% of Americans seem to always believe that the economy is in horrible shape because the modern Democratic Party needs a horrible economy in order to promote its message: "George W. Bush has ruined this country." Oh, I forgot, they've got Katrina, Iraq, and Global Warming to blame on Bush. But the bad economy line helps, too.

     
  • At 1:07 PM, Blogger Joe Smoe: American Citizen said…

    You got half of it right pal..oh sorry that is your line.

    Bush did blow Katrina, and most definitely Iraq. Also, the economy for a lot of America is less than stellar. Just ask AICS what the economy is like outside of Chicago. Lots of manufacturing jobs have dissapeared and out here in the west as their are still a record number of foreclosures and bankruptcies. When are you GOP lovers gonna realize that no longer do gains in the stock market translate into goodtimes for the average working stiff in the Global/Corporate Economy???

     
  • At 1:13 PM, Blogger Joe Smoe: American Citizen said…

    and Bush has ruined the country!!! Say what you want about Clinton we had Good economic times for all and a surplus that Bush and the GOP Pi**ed away.Now we have a two front war with Iraq in Civil War and Massive deficits as he and the GOP give the country away to the Illegals...they are the Dominant party.

    For once fess up to the fact that this jackass has taken the country to a worse place than he found it. 70% of Americans think so why not you????

     
  • At 10:08 AM, Anonymous r2w said…

    Before Abraham Lincoln was elected President, this country was not at war either. Would you say he ruined the country and the economy? Bush has dealt with a NECESSARY two-front war, natural disasters, the largest terrorist attack in American history, and still, the economy is bouncing back from all of it. And by the way, it is not just in Chicago that I see all these starter castles going up. The economy, overall, is doing very well.

    You can say Katrina is Bush's fault all you want, but that does not make it so. The same with Iraq - I believe history will show that Iraq was indeed the right move. In the midst of every war we have fought, there have been those who have claimed we made a mistake or blew it. History reveals the truth long after the detractors are gone.

     
  • At 10:09 AM, Blogger Malott said…

    If Bill Clinton had fought the war on terror instead of chasing little girls, I honestly believe there's a good chance 9/11 would not have happened.
    I think Bush is doing everything just about right... because I'm not a spoiled, mindless, ungrateful brat that believes a war must be completed in a week's time or it qualifies as a quagmire. Look at Europe and the Middle East and then tell me we shouldn't be preemptively kicking radical Islam's butt. If we're not actively engaging these murderers, then they're gaining ground.

    You have a right to your opinion, Smoe, but the economy is chugging along because the Republicans cut taxes and continued to fight the Dems and made the cuts permanent... permanent until the Dems get back in power.

     
  • At 6:04 AM, Blogger Joe Smoe: American Citizen said…

    Smoe, but the economy is chugging along because the Republicans cut taxes and continued to fight the Dems and made the cuts permanent... permanent until the Dems get back in power.

    All made possible with massive debt to China!!! A two front war that costs us $6 BILLION a month and gas prices threw the roof and sooner or later taxes will be raised. The same happened under Nixon with his Guns and Butter economics and after the same failed Supply side economics under Reagan and Bush1,which tripled the deficit.Remember that read my lips crap.

    Someone is going to have to pay this bill as more of tax payers money is given to Bush's War of Chioce in Iraq..who will that be??? the Middle Class and future generations of course. I thought you Republicans were supposed to be Fiscally conservative?? I know the new creedo is F*%^ the country as long as I get mine...right??

    r2w said...
    Before Abraham Lincoln was elected President, this country was not at war either. Would you say he ruined the country and the economy?

    That was a war to keep the Union intact...two seperate things..Civil War vs a war of Choice based on lies. Mark my words when the facts about this massacre come out we will not only lose what Iraqis still supported this war, but Bush also will lose the rest of the American people...GAME OVER for the tough talking nitwit from Crawford.

    Malott said...
    If Bill Clinton had fought the war on terror instead of chasing little girls, I honestly believe there's a good chance 9/11 would not have happened.

    Maybe if Bush would had woken up to the fact after being warned about the impending Alqueda strike (40+ times and one month before 911 something might have been done..this as per the 911 commission)...oh that's right he was on Vacation again.

    Face it guys, this Administration is a Miserable failure all across the board and it is plain to see that all they have told us has either been wrong or a lie.

     
  • At 8:49 AM, Anonymous Anonymous said…

    According to the Bureau of Labor Statistics, the average hourly wage of production workers was $14.70 in November 2001 and $16.61 in April 2006 for an increase of 13%. Over the same period of time, the inflation index increased from 177.4 to 201.5 for an increase of 13.58%. Therefore, since the recession officially ended (as determined by the National Bureau of Economic Research), wages have decreased .5%.

    Over the five years from 2000-2005, total debt, nonfinancial and financial, has increased $12.7 trillion in the United States. This compares with a simultaneous rise in national income by $2.1 trillion. For each dollar added to income, there were $6 added to indebtedness.

    Decreasing wages and increasing debt are not indicators of a healthy economy.

     
  • At 9:06 AM, Blogger All_I_Can_Stands said…

    Nobody is questioning the increasing debt being a negative. As for the decreased wages, it would be interesting to note what methods they are using. Is this a simple total wages divided by total workers to get average wages? Is each job sector and job type carefully analyzed to determine trends from each group and then combined for a total number.

    Math is an amazing thing that can be used to show opposite perspectives from the same data set. Most economists today tend to lean quite liberal, so I am not sure which angle this group is coming from either.

     
  • At 10:59 AM, Anonymous Anonymous said…

    The Bureau of Labor Statistics is the principal fact-finding agency for the Federal Government in the broad field of labor economics and statistics. http://www.bls.gov/

    The numbers are from the Bush Administration. Your conservative paranoia is safe with them.

     
  • At 11:20 AM, Blogger All_I_Can_Stands said…

    The Bureau of Labor Statistics is the principal fact-finding agency for the Federal Government in the broad field of labor economics and statistics.

    Just like the State Dept. and the CIA is "The Bush Administration"

    Even so, your cute answer doesn't give any indication as to how the numbers were calculated. If it is indeed a simple average, we could have a booming economy and a decreased average wages as you factor an influx of lower wage earners obtaining minimum wage employment.

     
  • At 10:21 AM, Anonymous Anonymous said…

    Great site loved it alot, will come back and visit again.
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