Here's how Paul Krugman explained the decline in Q4 that followed the curious Q3 spike;:
Most analysts are, rightly, shrugging off the surprise report of an actual decline in 4th quarter GDP. It will probably be revised away, and in any case it’s the result of one-off factors: a drop in inventories and a quirky sharp decline in defense spending.It's a quirky sharp decline, Paulie, only because of the spending being stuffed into Q3.
'curious' Q3 = The Obama re-election quarter.
ReplyDeleteMust pad the stats to guarantee a re-election. They will do the same in Germany this fall.