Visualizing Real U.S. GDP Since 2007 (Guest Post)

Commodities Desk, EconMatters | EconMatters | August 27, 2011 8:20 am

The chart below is my way to visualize real GDP change since 2007. I’ve used a stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself.

My data source for this chart is the Excel file accompanying the BEA’s latest GDP news release. Specifically, I used Table 2: Contributions to Percent Change in Real Gross Domestic Product.

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Here is the previous version of the chart, showing the Q2 Advance Estimate. Personal consumption expenditures (PCE) furnished only 0.07 of last month’s 1.29 (rounded to 1.3) GDP estimate.

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Over the time frame of this chart, the PCE component has shown the most consistent correlation with real GDP itself. When PCE has been positive, GDP has been positive, and vice versa. PCE in the latest update came at 0.30 of the 0.99 real GDP (rounded to 1.0). This is a bit better than the Advance Estimate but clearly in a downtrend from Q4 2010.

I’ll update this chart when the third estimate of Q2 GDP is released on September 29th. But the “real” story will be the following month, when we get our first glimpse of Q3 GDP

About The Author - Doug Short is the Vice President of Research for Advisor Perspectives. He holds a Ph.D. in English from Duke, and maintains a blog at dshort.com. Doug’s last name is not representative of his investment style. (EconMatters author archive here)

The views and opinions expressed herein are the author’s own, and do not necessarily reflect those of EconMatters.