Dollars and Jens
Friday, January 28, 2011
I had started to worry that too much of recent GDP gains were driven by inventory accumulation. In the fourth quarter, it appears there was basically no inventory accumulation, while imports fell and exports rose. Note that government expenditure is also a subtraction here; this is really the best 3.2% growth I've ever seen.
IV 07I 08II 08III 08IV 08I 09II 09III 09IV 09I 10II 10III 10IV 10
Gross domestic product2.9-.7.6-4.0-6.8-4.9-.
Nondurable goods.07-.50.31-.91-.78.06-.
Durable goods.20-.92-.23-.95-1.79.35-.211.35-.
Change in private inventories-.77-.49-.48-.12-2.31-1.09-
Fixed investment-.76-.98-.69-1.83-4.01-5.71-1.26.12-.12.392.06.18.50
Net exports of goods and services3.21.841.04-.631.502.881.47-1.371.90-.31-3.50-1.703.44
Government spending.24.44.651.04.31-.611.24.33-.28-.32.80.79-.11

Update: Now that I look at it, both inventory accumulation and net exports have been strongly pro-cyclical lately; if I back out half of each, the last five quarters have growth rates (in reverse chronological order) of 3.3, 2.6, 3.0, 2.5, and 2.6, a smoother series than the headline numbers. The inventory accumulation and net exports have also been negatively correlated. I wonder how much of the inventory fluctuations have been in tradeable goods sectors, and have been seeing inventories absorb the fluctuations in foreign trade. Of course, this can get into data-mining pretty quickly; it's not as though I have that many degrees of freedom to look at.


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