There's been so much happening across the world lately that it's time for a global update on a variety of subjects.
Yet, these developments stand in stark contrast to the US equity markets, where there's virtually nothing worthwhile to report on. Our "markets" no longer resemble anything that might provide useful, actionable information.
GDP & The S&P 500
For example, the final revision was made to first quarter 2014 US GDP, which clocked in at the shockingly low -2.9%, handily missing every single economic forecast by a very wide margin.
The data was particularly ugly, and a real surprise:
U.S. GDP Dropped 2.9% In The First Quarter 2014, Down Sharply From Second Estimate
June 25, 2014
The latest data shows the U.S. economy contracted significantly more than previously estimated in the first quarter of this year.
On Wednesday, the Bureau of Economic Analysis released its third and final estimate of real gross domestic product for the first three months of 2014. The release showed output in the U.S. declining at an annual rate of 2.9%.This is relative to fourth quarter 2013, when real GDP grew 2.6%.
The final number is also down from BEA’s negative 1% second estimate released last month and even more sharply from its first estimate that showed GDP growing 0.1%. While this makes Q1 the economy’s worst since Q1 2009, the heart of the recession, economists were anticipating the further downward revision.
(Source)
There are two things to note from the above article. The first is that, when we combine both the fourth quarter of 2013 with its +2.6% advance and the first quarter 2014 results of -2.9%, we find that over the past two quarters US GDP is now slightly down.
Here's the math using round numbers for illustrative purposes. Suppose the US GDP was 10,000, and then advanced 2.6%: that would take it to 10,260. Now we trim that result by -2.9% and we get 9,962.
So, over the prior two quarters, US GDP has managed to shrink. So much for aggressive monetary policy — which seems to provide us only with enormous risks and growing wealth inequality, but nothing much to speak of in terms of broad-based and shared economic benefits.
by davefairtex 
