Q2 GDP revised higher due to surge in personal consumption…The Bureau of Economic Analysis (BEA) decided to pull a Bureau of Labor Statistics (BLS) and reported a large increase in GDP in its first revision of Q2 GDP.While corporate America and companies like Dollar General and Walmart have similar same store revenue growth, they do have very different operations. Dollar General warned that its clientele is significantly constrained due to the economic headwinds and continued increase in inflations. Its CEO, Todd Vasos, acknowledged consumers are being pressured in today’s environment of elevated inflation and high interest rates. He went on to say, “While we believe the softer sales trends are partially attributable to a core customer who feels financially constrained. While Walmart instore same sales where almost identical their online success is a very evident.What does it mean – Hard to believe. The BEA revised GDP higher. It contradicts almost all other reports from the BLS and the private sector. Along with massive job loss we saw during this period along with continued revised down job growth, it is hard to believe that alone has had no bearing on GDP according to the bean counters in the federal government. Not to mention the continued rise in inflation, slowing housing market coupled with continued slide in manufacturing. HMMMM.In other words, the economy had to perform to near perfection or a “Six Sigma” performance according to Zerohedge. Unfortunately for the government we already got the reports that showed our economy losing 818,000 jobs, 20 out of 21 quarters of lower manufacturing, and a construction industry bifurcated between well run states with low taxes and the dismal reality of poorly run over taxed and over regulated states like CA, Il, MI, NY, NJ and others. One day the government will realize who they actually work for.Consumer confidence stalls…While July was revised up, August seems to wane.What does it mean – According to Briefing.Com, the report shows that consumers are starting to show more concern about labor market conditions. This could eventually translate into lower consumer spending activity if that labor market angst leads to deferred discretionary spending decisions further questioning the report from the BEA.Nonfarm payrolls increased by a smaller-than-expected…July nonfarm payrolls increased by 114,000.What does it mean – The unemployment rate increased to 4.3% from 4.1%. The U-6 unemployment rate, which also accounts for underemployed workers, rose to 7.8% from 7.4%. Again, the numbers do not add up to the recent reports from BLS and BEA.It is harder to find work…According to the U.S. Conference Board, finding work is getting difficult.What does it mean – According to the Federal Reserve’s own numbers, manufacturing jobs have been on the decline for most of 2024. While manufacturing is only one key indicator in the economy, we have also seen a massive shortage or lack of hiring in the hospitality and hotel industry along with construction. Again, a sharp contrast to what the BEA is telling us.
