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3Q US GDP What Was Up Was Really Down

I did not see anything from the US GDP report for the 3q that changed my view that the more likely monetary move by the fed will be to loosen monetary policy over the medium term. Taking out inventories and trade--the more volatile part of US GDP-- reveals really a continuation of a trend of slowing growth in the US. As I pointed out in my SOM US Theme piece, the dynamics of US growth are slowing, driven in part by calcification of US corporations. GS in the latest weekly point this out as well in their more recent piece. So, I get the focus on the strength of the labor market. However, US corporations are likely to slow hiring in the short to medium term in response to slowing revenue growth, as the US consumer is saving rather than spending as they have historically. Again this growth in savings could be in response to rising income inequality/growing monopoly power by US corporations.

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