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castorinho
Oklahoma Fan
13623 posts
Member since Nov 2010
68348 posts
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Q2 GDP, annualized, quarter over quarter -32.9%
vs -34.5% expected
Was -5% change in Q1.
This post was edited on 7/30 at 9:06 am


RedStickBR
LSU Fan
Member since Sep 2009
13776 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
The oddest thing is happening. Futures are actually down 1%


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50
wutangfinancial
LSU Fan
Dallas, TX
Member since Sep 2015
4083 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
Obviously the play here is 0 Delta max strike QQQ calls. So bullish.


RedStickBR
LSU Fan
Member since Sep 2009
13776 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
I know you're being tongue in cheek, but on a serious note: the Put-Call ratio is actually climbing, which is interesting given:

1. Horrible, but expected, GDP print
2. Jobless claims worse than expected
3. Monetary stimulus appears to have plateaued
4. Consumer spending about to take a hit as unemployment benefits go from >100% of average wages to ~70%

I'd hate to be a Beta chaser if and when the market starts trading on fundamentals again


buckeye_vol
Ohio State Fan
Member since Jul 2014
33380 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
Interestingly now neither Obama nor Trump have a stake at the dubious claim of never having a year with annual GDP of 3% or more as 2015 (3.1%) and 2018 (3%) were both revised upward.

From Ben Casselman at the NYT:
quote:

This definitely qualifies as trivia, especially right now, but for the record: 2018 annual growth was revised back up to 3%. But 2015 was revised up to 3.1%, meaning Trump can no longer claim Obama never had a full year of 3% growth.


RedStickBR
LSU Fan
Member since Sep 2009
13776 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
To see people try to accurately characterize the Obama claim was so funny. To be accurate (before this revision), you had to have made at least (3) qualifiers by my count:

Obama is the only President (1) in recorded history never to have achieved at least 3.0% (2) annual (i.e. calendar year and not four successive quarters) (3) real GDP growth.

Now they're going to have an asterisk to contend with, too


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21
Uncle Stu
#AlbinoLivesMatter
Member since Aug 2004
32822 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
just so it's clear- thats "annualized"

GDP fell by 9.5%. If GDP continued to fall at that rate for a full year, it would be 32.9%, but that is not what happened in the 2nd quarter.

It's still very very bad, but the 32% is something of a sensationalized headline number to get clicks


wutangfinancial
LSU Fan
Dallas, TX
Member since Sep 2015
4083 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
The problem is that stuff is already "priced in." It will take an event in the bond market to shake the QQQ tree again. The DXY looks like it's behaving how the Fed wants and the MOVE index continues to dive so I'd guess we see ranged trading until Q3 earnings season.

quote:

Interestingly now neither Obama nor Trump have a stake at the dubious claim of never having a year with annual GDP of 3% or more as 2015 (3.1%) and 2018 (3%) were both revised upward.


I honestly thought the opposite would happen to 2018/2019.
This post was edited on 7/30 at 9:28 am


RedStickBR
LSU Fan
Member since Sep 2009
13776 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
I agree with you we'll need a catalyst before we see any sort of major retracement in the stock market, but I also think the underlying environment continues to evolve such that if said catalyst occurs, it could be catastrophic. Fiscal and monetary policy are both already highly accommodative, valuations are already near historical highs and credit is already tightening in certain areas.

While it may require a knockout punch to take out this market, I still think it's worth acknowledging the market appears to have a chin of glass at present.
This post was edited on 7/30 at 9:33 am


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SECFan1995
Col. of Charleston Fan
Member since Sep 2015
7761 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
If we bounce at 25k and 3k again when that comes up, that is going to confirm to me that we're range bound for a while.

I would not be surprised to see QQQ/the NASDAQ shave some points off whenever a vaccine gets announced next year, but it won't be a large amount unless the Fed has to raise interest earlier than they want to or we see another black swan event. Besides technology, a large amount of the stock market is still in a bear/recession market anyway.


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wutangfinancial
LSU Fan
Dallas, TX
Member since Sep 2015
4083 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
quote:

unless the Fed has to raise interest earlier


I just don't see Paul Volcker walking through the door. If we raised rates at all in the next several years we would destroy our suppliers for everything we consume and it would become a positive feedback loop of economic destruction.


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TigerDeBaiter
LSU Fan
Member since Dec 2010
8724 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
quote:


just so it's clear- thats "annualized"

GDP fell by 9.5%. If GDP continued to fall at that rate for a full year, it would be 32.9%, but that is not what happened in the 2nd quarter.

It's still very very bad, but the 32% is something of a sensationalized headline number to get clicks


This is worth repeating.


tigergirl10
Member since Jul 2019
1755 posts
 Online 

re: Q2 GDP, annualized, quarter over quarter -32.9%
quote:

unemployment benefits go from >100%
Not true for a lot of people. There are plenty of people who are unemployed and make much more than what unemployment pays. My entire family is losing thousands.

Anyone who makes over $40,000 in Louisiana is losing money. The max unemployment is $767 a week in Louisiana after 10% taxes. A lot of people with careers, mortgages, and children make more than that without unemployment.

Without an extension, LA people will receive less than minimum wage at $222 a week.


fallguy_1978
LSU Fan
Half mile from St George
Member since Feb 2018
26616 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
Are you currently unemployed?


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RedStickBR
LSU Fan
Member since Sep 2009
13776 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
quote:

Not true for a lot of people.


True. I was speaking in generalities just to assess what the macroeconomic impact may be on discretionary spending. While there are certainly people for whom UE < pre-COVID wages, what I've seen is that UE > pre-COVID wages for 67% to 80% of U.S. workers. That means many people have actually had more money to spend post-COVID vs. pre-COVID (hence my >100% figure). When that drops to 70%, it should have a negative impact on discretionary spending (which is significant, given consumption is about 70% of the U.S. economy).
This post was edited on 7/30 at 11:41 am


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wutangfinancial
LSU Fan
Dallas, TX
Member since Sep 2015
4083 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
quote:

This is worth repeating.



Meh you can spin all you want but that print includes April and May where the poverty rate decreased and the unemployed received a pay raise.


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01
NC_Tigah
LSU Fan
Carolinas
Member since Sep 2003
100518 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
quote:

just so it's clear- thats "annualized"

GDP fell by 9.5%. If GDP continued to fall at that rate for a full year, it would be 32.9%, but that is not what happened in the 2nd quarter.

Right.

GDP fell by 9.5%

So can someone explain how the 32.9% is derived.


buckeye_vol
Ohio State Fan
Member since Jul 2014
33380 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
quote:

Right.

GDP fell by 9.5%

So can someone explain how the 32.9% is derived.
0.905^4 = 0.671


HailHailtoMichigan!
LSU Fan
Mission Viejo, CA
Member since Mar 2012
61612 posts
 Online 

re: Q2 GDP, annualized, quarter over quarter -32.9%
Not sure why today's gdp print sent stocks tumbling. it was widely known that april-june was going to be an historic downturn. In fact, today's print was better than expected.

Why wasn't this baked in?


RedStickBR
LSU Fan
Member since Sep 2009
13776 posts

re: Q2 GDP, annualized, quarter over quarter -32.9%
I think it was likely more related to the employment numbers sucking wind.


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