Dollars and Jens
Wednesday, February 10, 2010
Inventory cycles

Source (pdf). Note that, in the current cycle, all 7 quarters he shows have seen the level of final sales as higher than GDP, and that much of the recent GDP growth has been a reduction in the gap (as production has partly caught up with final sales), not an actual increase in inventories. This guy is making the assertion that the demand for inventories could lead to a significant boost to the economy going forward, as it did after the 1982 recession. (cf. my dicta in the last GDP report.)

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