Tag Archives: recession

We Dodged Another Recession. 4Q 2012 GDP Was Positive. Barely. The Bare Minimum. But, Positive. So No Blizzard Related Recession.


Anura Guruge

Related post:
Blizzards Biggest Fallout: A Possible Recession! — Feb. 10, 2013.

See that little blip at the very right. ‘0.1’. That was 4Q 2012 GDP. Never mind that it was 0.1, the smallest number that they can report. It was positive. We are in the clear for another quarter. Click to ENLARGE.

I had been meaning to write about this for 11 days since the REVISED 4Q GDP for the U.S. was released on February 28, 2013 — the day that the old pope, Benedict XVI (#266) officially resigned and left the Vatican. Suffice to say I have been crazy busy with pope stuff and continue to be.

I was waiting for the number. I was lying in bed, drinking my coffee, with CNBC on. When the number came in I gagged, more out of amusement than anything else.

I am so glad that after 4 years in power the Obama White House has finally come to realize that these are THEIR NUMBERS and a little bit of steaming, if not outright cooking, is OK — even expected. What is the point of being in power if you don’t abuse it — a bit.

The initial, first-cut reading of 4Q GDP, given Hurricane Sandy, at been negative. That was not good. Two quarters of back-to-back negative GDPs and we are automatically in a recession.

I was worried that the Blizzard Nemo might do to 1Q 2013 what Sandy had done to 4Q. That would have meant a recession. Not good for any of us, politically or financially.

But, common sense obviously prevailed in D.C., particularly at the W.H. Revise the 4Q GDP to 0.1%.

Everybody is now happy. It is positive. Even if 1Q 2013 comes in negative we are in the clear — since 2Q looks ‘OK’, sequestration or no sequestration.

Stock market is doing good, though my son, the new stock market wizard (with impressive results), got me to short the market on Friday. I indulged him, as I am wont to do. What is the point of having kids if you don’t indulge them. Of course there has to be a correction soon. So he will be proved right. Question is how much money we would have made by shorting. I, being poor, didn’t ‘bet’ that much. Don’t have the money. He was betting 2.5 times more than me. I am happy. I am the one who told him, about a year ago, that he, given the way his brain works, will be good at stocks. After a shaky start he is looking impressive. I could see a Guruge Hedge Fund in the future. That would be a riot. The ONLY other Sri Lankan I know who had a hedge fund is now in jail! But, Matthew has a different pedigree.

Blizzards Biggest Fallout: A Possible Recession!


Anura Guruge

Some Of The Blizzard Related posts:
Blizzard Of 2013: Update From Alton IV — Feb. 8, 2013.
Blizzard Of 2013: Update From Alton III — Feb. 8, 2013.
>> Blizzard Of 2013: Now We Can Joke — Feb. 8, 2013.


Hit me like a ton of bricks when I saw all the business closed in Providence and Boston today. Many also closed early yesterday. There won’t be much foot traffic in Boston tomorrow — the 1st (non-parade) Sunday of Chinese New Year.

This blizzard will have a negative impact on 1Q GDP.

Last quarters GDP was negative, though barely. But, it was negative — and Hurricane Sandy was responsible for some.

Definition of a recession: two back-to-back quarters of negative GDP.

1Q GDP was tenuous to begin with thanks to all of the continued mindless political wranglings in D.C. — and you know who I blame for much of that.

A recession is really but a technical indicator and by the time we are told that we are in a recession it could very well be in the rear-view mirror. Remember the definition: two negative back-to-back quarters of GDP. So by design it is a trailing indicator. We will only find out about 1Q GDP in 2Q. 2Q, thanks to President Obama, could be blowout. End of recession.

The President doesn’t have to worry about re-election and I already feel confident that Hillary will easily win 2016. I can’t believe I am saying that. In 2008 I detested her. I was never a Clinton fan during their Presidency. I spent so much time circulating Clinton jokes, so, so many about cigars and that blue dress, in the mid-1990s. I was even compiling a dossier on Hillary’s alleged dalliances. Remember that guy who shot himself in a park? Well that was then, and this is now. I started to warm up to her once she started embracing my man. She did a bang up job as Secretary of State. She made Obama proud. I have come to like and even admire Bill! I really have changed my stripes. This is why those that knew me in the 1990s are beside themselves as to my 180° change in political leanings. Since they are all conservatives, as was I, they don;t really like me much anymore. Some are holding out hope that I will see the light and change stripes again.

So a quick, passing recession precipitated by Nemo will not have any political ramifications. We might get a 400 point one-day drop in the Dow. That too will pass.

But, just keep an eye on this potential recession — and remember where you first read about it.