The Atlanta Fed's GDPNow Nowcast declined again this morning. Now the projection is for 0.3% growth for the third quarter. Any more slippage and the quarter will be the third straight quarter of contraction.
The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2022 is 0.3 percent on September 20, down from 0.5 percent on September 15. After this morning's housing starts report from the US Census Bureau, the nowcast of third-quarter residential investment growth decreased from -20.8 percent to -24.5 percent.
Will three consecutive quarters of contraction suffice for the Biden Regime to finally admit the US economy is in recession? We already know Jay Powell doesn't give a damn so long as inflation is out of control (which it will continue to be no matter what the Fed does).
"Tomorrow's rate hike will add an estimated $2.1 trillion to the federal deficit over the next two years, according to an analysis from the Committee for a Responsible Federal Budget (CRFB), a nonprofit that advocates for lower deficits. That's $2 trillion that goes on the tab to be repaid even though no one ever benefitted from it. It helped to build no bridges, feed no hungry people, or make any business more profitable."
It's worth noting that a month ago the markets were anticipating a 50bps hike, and also noting that as late as last week significant consideration was given to the possibility of a full percentage point (100bps) hike. Current market prognostication has an 82% probability for a 75bps hike and an 18% probability for a 100bps hike.
Personally, I have long felt that the government should be Constitutionally confined to spending no more than 90-95% of net tax receipts each fiscal year, with the remaining surplus to go into some form of "rainy day" reserve. Deficits should require a 2/3 supermajority of both houses of the legislature to approve.
Under such a budget plan, virtually all of the obscene horse-trading that goes on in Congress around the budget would be eliminated, along with monstrous interest payments.
I pulled this from reason.com
"Tomorrow's rate hike will add an estimated $2.1 trillion to the federal deficit over the next two years, according to an analysis from the Committee for a Responsible Federal Budget (CRFB), a nonprofit that advocates for lower deficits. That's $2 trillion that goes on the tab to be repaid even though no one ever benefitted from it. It helped to build no bridges, feed no hungry people, or make any business more profitable."
And that is assuming the Fed "only" hikes by 75bps.
(full url for the referenced article)
https://reason.com/2022/09/20/expected-interest-rate-hike-will-add-2-trillion-to-the-deficit/
It's worth noting that a month ago the markets were anticipating a 50bps hike, and also noting that as late as last week significant consideration was given to the possibility of a full percentage point (100bps) hike. Current market prognostication has an 82% probability for a 75bps hike and an 18% probability for a 100bps hike.
https://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html
Personally, I have long felt that the government should be Constitutionally confined to spending no more than 90-95% of net tax receipts each fiscal year, with the remaining surplus to go into some form of "rainy day" reserve. Deficits should require a 2/3 supermajority of both houses of the legislature to approve.
Under such a budget plan, virtually all of the obscene horse-trading that goes on in Congress around the budget would be eliminated, along with monstrous interest payments.