Courtesy of Mish.
A New York Times headline by Floyd Norris reads In U.S. Data, a Baffling Contradiction.
The same article, by the same author, appears on Yahoo!Finance as In U.S. Data, a Contradiction That Makes No Sense.
The first quarter of this year was the worst for the United States economy since the depths of the Great Recession in early 2009.
During the same period, employers hired more people than in any quarter over the last six years, signaling gathering strength in the economy.
It is hard to imagine how both of those statements could be true, but they are what government statistics indicate.
While the employment numbers have been strong, the government sharply cut its estimate of first-quarter gross domestic product late last month. It had previously said the economy declined at an annual rate of 1 percent during the quarter — a small dip that could be explained by severe weather in much of the country. The new figures showed a 2.9 percent rate of decline, the worst since a 5.4 percent drop in the first three months of 2009.
What happened? Put simply, a single government survey produced highly dubious numbers. Those who conduct the survey say it was done normally and that nothing suspicious surfaced in the responses. But — particularly in the case of one vital part of the economy — that survey contradicted other available information. The result was suspiciously low revenue estimates for companies in both health services and food retailing.
The big decline in estimates of the size of the United States economy was caused primarily by a sharp reversal in the government’s estimate of spending on health care services.
Questions on Obamacare
In regards to the peculiarities of Obamacare I have a couple of questions:…
