Eurodollar University
The REAL Economic Data Was Just Released, It's Not Good
Aug 19, 2024
Steve Van Metre, an economic expert, and Goolsbee, a Bloomberg Fed adviser, dive deep into troubling revisions in U.S. economic data. They reveal how constant downward revisions hint that the economy might be overstated. Discussing consumer behavior, they note affluent shoppers are now turning to budget retailers. The pair also worry over stagnation in retail sales, questioning if current growth is merely debt-driven. As unemployment claims rise, the narrative of a soft landing is challenged, leaving listeners alarmed about the future of economic stability.
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Quick takeaways
- The phenomenon of 'revision disease' in economic data highlights consistent downward adjustments, causing concerns about the true state of the economy.
- Despite initially positive retail sales figures in July, subsequent downward revisions reveal a troubling reality of weaker consumer spending and economic resilience.
Deep dives
The Impact of Revision Disease on Economic Data
Recent trends in US economic data reveal a pervasive issue known as 'revision disease,' where initial reports from government agencies are frequently revised downward. This phenomenon began with payroll figures and has now extended to key metrics such as retail sales and industrial production. For instance, July's retail sales, which initially exceeded expectations, have undergone significant adjustments that suggest a much weaker consumer spending landscape than previously indicated. Such revisions raise critical questions about the reliability of these economic indicators and their implications for assessing the health of the economy.
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