Final Q4 GDP & Initial Claims

Summary: The economy continues to deteriorate with Initial jobless claims at their highest in two years.

Q4 Final GDP points to Zero growth with plunging corporate profits. Without export increases on a debauched dollar, the economy had negative growth.

Initial Claims 03/22 -9K at 366K vs prior 375K Full Report

Inside the number: prior reduced by 3K; 4 week MA +1.75K at 358K. Continuing unemployment -5K at 2.845M; 4 week MA +25,25K at 2.824M

GDP-Final Q4 +0.6% vs Q3 +4.9% Full Report

Inside the number: Chain Deflator-Final Q4 +2.5% vs prior est.+2.7%. Slowing Net Imports -1.4%; of goods -2.6%;

Net Exports of goods & services contributed +1.02%, taking GDP from negative -0.42% to positive +0.6%.

Tame STAG-flation? Looks like double digits to me. Table 4 price index Imports +13.2%; goods +14.1%

Corporate profits for Q4 dropped 3.3%; the 2nd straight quarterly decline with a decrease of $52.9 billion vs Q3 decline of $20.5 billion.

The economic drivers for the last 8 years: housing & finance.

For the year corp. profits +2.6% vs 2006 +12.2% the smallest gain since 2001 with banking industry profits falling to a 16 year low of $5.8 Billion.

Spending on new construction in Q4 -25.2% vs prior -20.5%, the largest drop in 27 years. Gross private investment -14.6%; fixed investment -4%.

John Q. lays down 2/3 of the economy.. real gross domestic purchases -0.4% vs prior +3.3% as receipts -$12.9 billion and payments -$50.5 billion.

The Nattering One muses... It gets better... The Q4 decline in corporate profit is severely understated as

financial firm profits took at 15% hit WITHOUT accounting for loan loss provisions and asset write downs in the calculations.

Joe Saluzzi, co-manager of trading at Themis Trading in New Jersey:

"anyone who thinks we're not in a recession is living under a rock. Let's just get it over with."

Pronounced with a healthy crotch grab, The Nattering One sends a mighty YO out to Joey.

Comments