GDP Revision, Durable Goods: Ouch! has the details:
"Need a reason why the Fed’s going all in to juice the economy? Check this morning’s round of economic data.
The economy grew last quarter at an annual rate of 1.3%, according to the Commerce Department, a figure revised lower from the originally reported 1.7% gain. Economists were expecting 1.7% growth. The lower revision was due to less-than-expected consumer spending and weaker farm inventories, which were hit by the drought.
Whether the economy is growing at a 1.7% rate or a 1.3% clip is essentially negligible to the average American. Either way, growth is extraordinary weak for this stage of the economic recovery. As Paul wrote in today’s Morning MarketBeat, “The biggest problem with a stall-speed economy is that it’s exposed, and liable to be knocked over by any sort of exogenous shock.”
Other economic data released this morning didn’t exactly paint an uplifting picture of the economy. Durable goods fell 13.2% last month, notching their biggest decline since January 2009 and underscoring the growing weakness in the manufacturing sector. Weak orders for commercial aircrafts contributed to the downbeat number. . . .
“The sharp downward revision to the GDP report and the weaker-than-expected performance in durable goods orders in August provide a sobering reminder that the overall economic recovery is continuing to struggle to regain traction,” wrote Millan Mulraine, a strategist at TD Securities. “And while the improvement in consumer confidence and housing market activity offer some hope of better growth performance this quarter, the collapse in durable goods orders and weakness in shipments suggest that capital investment activity could continue to be a sore point for the economic recovery.”
The one hopeful sign this morning came from jobless claims, which tumbled by 26,000 to 359,000, the lowest level since July. Claims had been creeping higher in recent weeks, so this is a good a sign. But expectations are still pretty downbeat for the next monthly jobs report, due one week from tomorrow."
And so the roller coaster ride to nowhere soon continues along its not-so-merry path.