This is simply stunning.
Regular readers will recall that last month, at the same time as the U.S. Bureau of Economic Analysis reported was a far better than expected 3.9% GDP (since revised to 5.0% on the back of the previously noted Obamacare spending surge), it also released its Personal Spending and income numbers for the month of October, or rather revised numbers, because as we explained exactly one month ago “Americans Are Suddenly $80 Billion “Poorer” thanks to (upward) revised spending data and (downward) revised income. What this meant a month ago is that as a result of a plunge in the imputed U.S. savings rate, some $80 billion in personal savings was revised away from the average American household and right into the U.S. economy.
After all, something had to grow the U.S. GDP by a massive amount in order to give the Fed the green light it needs to hike rates eventually, just so it can then ease when the global dry powders from all the other central banks is used up.
And sure enough, this is how Americans Are Suddenly $80 Billion “Poorer, personal income was revised lower…
… Even as personal spending was revised higher:
Leading to an $80 billion revision lower in personal saving, and by mathematical identity, a comparable growth in U.S. GDP.
* * *
Fast forward to today when we find that… absolutely nothing has changed, and in order to boost U.S. GDP some more, the BEA engaged in precisely the same data revision trick!
On the surface, today's Personal Income and Spending data were inline to a little bit better than expected:
