Tuesday, September 01, 2009

"Economists are loathsome charlatans, and GDP could be negative"

Adam Carr this morning:
"There are a couple of reasons why I regret ever becoming an economist. The main one is obvious – economists are loathsome charlatans. Snivelling, petty, fearful and embittered – kind of like Gollum from the Lord of the Rings (my precioussss!!). I've even met one who is the spitting image.

The other reason is that we have to deal with statistics. Now this one slipped me by on Friday, but apparently the ABS revised up its import volumes estimate from -1.9 per cent in Q2 to +0.2 per cent. This is significant as it could mean – depending on what alchemy was applied to the exports figures – that the net export contribution is small. Following the inventories number yesterday this scares me and opens us up to a negative quarter of GDP. We’ll find out today with the balance of payments numbers (11.30am). Going into the figure I’ve revised my net export contribution from +0.5 percentage points to +0.1 percentage points."