A quick note before I take a nice afternoon of golf with friends:

The GDP numbers are interesting. Not only is the headline number better than expected, but final sales were virtually flat. But,

Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever produced -- decreased 2.3 percent in the second quarter, compared with a decrease of 8.6 percent in the first.

That is, a big drag on US GDP is coming from us purchasing fewer imported goods. Real imports fell almost 16% while real exports fell only 7%.

Savings continues to increase.

Personal outlays decreased $18.1 billion (0.7 percent) in the second quarter, compared with a decrease of $27.6 billion (1.1 percent) in the first. Personal saving -- disposable personal income less personal outlays -- was $566.0 billion in the second quarter, compared with $426.9 billion in the first. The personal saving rate -- saving as a percentage of disposable personal income -- was 5.2 percent in the second quarter, compared with 4.0 percent in the first.

I think that rate continues higher, but having it come from imports rather than domestic production might be helpful on a number of fronts, including the value of the dollar.

Labels: economics