Gdp 7.2%

If you break the number down, much of it is the result of exports, and that is the result of currency issues. So in theory at least, this is not sustainable.

Doesn't look good for jobs creation either.

nitro
 
Good point, companies that report better earnings based on currency fluctuations and not real growth in demand usually don't get rewarded with buying. If the dollar has to keep going down to sustain this level of "growth", it won't be pretty further down the road.
 
This growth was primarily stimulus driven, which begs the question: what happens when the refis and tax rebates dissipate? And if jobs weren't created as the economy grew at the fastest rate in two decades, what does that suggest about the labor market going forward as we return to more normalized rates?
 
Quote from illiquid:

Good point, companies that report better earnings based on currency fluctuations and not real growth in demand usually don't get rewarded with buying. If the dollar has to keep going down to sustain this level of "growth", it won't be pretty further down the road.
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these numbers are not pretty, and by the look of it the markets aren't buying the hype either, and are selling off in total displeasure.

the simple and logical explanation that only begins to attempt to take a swipe at this complex issue are:
1) unsustainable one-time accounting tricks
2) companies reporting higher earnings and beating estimates based upon layoffs, firings, down-sizings, off-shoring, and other readjustment measures can't continue to repeat those techniques
3) two-timing or double-dipping in a one-dip well doesn't work, even for prestidigatators

there remains whole segments of the populace and economy in total Depression, and de-facto bankruptcy, or as the more socially acceptable term "working poor" is deemed.

there's something seriously wrong here/.....
 
Quote from illiquid:

Good point, companies that report better earnings based on currency fluctuations and not real growth in demand usually don't get rewarded with buying. If the dollar has to keep going down to sustain this level of "growth", it won't be pretty further down the road.
More...
Yes, your theory is borne out. Look at the Internationals on the DOW today, e.g.,

KO CAT MRK MCD

With the exception of MCD, all red, and MCD barely green.

nitro
 
Aside from the fact that this is just alot of hand waving, and althouth the markets agrees with you, I do not - at least it is not clear.

However, the reason for the selloff is because the market was looking to sell into an unexpected move to take profits - having done that at any other time would have left alot of money on the table (on swing trades.) The other numbers prior to the GDP number has been mostly within the +/- of expentacy.

I would not read too much into a failure at 1055 or so. People that keep trying to short this market by pickign tops without letting the bear develop naturally are getting plastered.

nitro

Quote from mickhill:

NOT MUCH WHICH IS WHY YOU SHOULD SELL! THERE'S NOTHING LEFT TO GET BULLSIH ABOUT...LIGHTEN UP ON THE BIG MOVERS
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