US government has made negative contribution to GDP growth for 6 quarters10 May, 2012, 1:18. Posted by Zarathustra
I am doing a lot of data digging and number crunching these days which goes beyond those I usually look at, i.e. China data (there are not many detailed data that you can really look at, as statistics from China are a mess).
Earlier I produced a few charts on the Australian economy, which should make people worry about the Australian economy, given the fact that it has a pretty big banking sector relative to the economy, and that households have not deleveraged. I would also wonder if fiscal tightening just announced would be any good with a slowing economy.
I am also looking at the US economy, as I am increasingly optimistic on the US economy (relative to the rest of the world, I should stress). Not that I am particularly keen on the idea of decoupling where US can maintain growth in the face of a European meltdown and a China hard landing, but I am rather optimistic on the US that this country will come out on top. Anyway, that is only my hunch over the past few months, and I am certainly going to go through more data to make my case.
For now, the chart below shows the contribution of different expenditure components towards the real GDP growth. There is nothing new here. In fact, we have known that for a while. No matter how much you loathe about the US running a big government or spending too much, the fact is that the US government has made negative contribution to GDP growth for 6 consecutive quarters. Or in other words, government expenditures have decreased for 6 quarters.