- Final Q4 GDP was left pretty much unchanged from its second estimate. The reason was about $20 billion (give or take) removed from final sales but then added to inventories. Already epic, the quarterly change in private inventories (nominal) now stands at barely shy of a quarter-trillion (SAAR) in a single quarter.
- Now inventory is starting to tell the other side of the classic supply shock story, when goods arrive at a time when demand is more questionable.
- Despite the assurances about some labor shortage, businesses instead aren’t paying market-clearing rates, which is keeping millions on the sidelines when recovery in work is needed for full recovery across the economy.
For further details see:
GDP (And GDI) Lays Out The Perfect Supply Shock Case, And Its Downside