7/11/2007

A surprising GDP growth

8.2% yoy growth in the second quarter and economists are revising the whole year estimates which can possibly be double digits. That's a big surprise. Would there be surprising news for the people, I mean the citizens, the good kind of surprises? Basically, what's in it for the people? Higher income, higher employment rate, higher prices, higher costs? Would the better than expected economic data be justification for raising fees and rates in good times, quickly before the feel good moment is gone? That may not be surprising. Not at all.

3 comments:

Matilah_Singapura said...

Bear in mind the EXPANSION of the money supply (MAS's own figures) by about 20%.

Therefore there is a fair amount of inflation in the growth figure.

The growth figure reflects "growth" by inflation (higher prices), and "real" growth which results from new products, better proceses and increased consumer demand.

Also look at the wages: up around 4%.

Real estate: high, stocks: high. Price level: up. Wages: up.

All these are signs of "good times" based on inflation and credit expansion.

Oh well, have a good time folks :-)

redbean said...

what goes up must come down, except cost of living here.

Matilah_Singapura said...

Not necessarily, redbean.

Cost of living has fluctutated, although not equally nor evenly through the economic system.

Only a few years ago you could get a buffet for fuck all, and rent landed property for under $1000 a month. Even COE's dropped to their lowest.

However, the global economy in general has picked up since — but a significant portion of the "growth" is due to inflation of the money supply (due to pathalogical borrowing by the US) in directly contributing to the excessive use (misuse) of oil and thus driving UP the oil price.

Dig this fact:

US Presidents from Washington to Clinton have borrowed a TOTAL of $1.01 TRILLION.

George W Bush alone in not even 2 terms of office has borrowed $1.05 TRILLION

Now, all that "extra" money (created by credit) has to "go somewhere", and when it does it bids up the prices of everything and causes accounting figures like profits and revenues to be "inflated".