Friday, July 31, 2009
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.