The CBO is now assuming over 6% growth from 2015 for 3 years.
They are assuming growth for 2013 of over 3% and even higher numbers for 2014 on.
Even during the boom period (1950 to 2000) growth only averaged 3.3.%.
From 2001 to 2011 growth only averaged just under 2%.
If the CBO is expecting large increases in GDP growth because of the massive increases in Health Spending due to Obamacare, they are out of luck.
The middle class will pay for almost all of this increase in costs (subsidizing the increased coverage of others), the middle class is already tapped out and their disposable incomes are already DECLINING (before Obamacare).
The middle class will not be spending the large increases they are having to pay for Healthcare, everywhere else.
In addition Obamacare will raise price inflation of just about everything - businesses will be passing their increase in costs onto the consumer.
The CBO will have to dramatically revise down their 2013 growth forecast down over the next few months.
They will have to very dramatically revise down their growth forecasts for 2014 on.
Job creation in 2013 has been anaemic to say the least, so far.
Only 131,000 full time jobs have been created.
141,000 part time jobs have been created.
291,000 people have taken a second part time job.
http://ian56.blogspot.co.uk/2013/05/aggregated-nfp-employment-numbers-for.html
Disposable incomes are dropping dramatically - down over $50bn already this year.
http://ian56.blogspot.co.uk/2013/05/the-relentless-decline-in-disposable.html
What were the CBO predictions in 2000 or 2007?
I would be genuinely interested in hearing what they were, early on in either of those 2 years.
Consensus for Q1 GDP was +3%.
Goldman estimated it at +3.2%.
Goldman noted they expected a high number because of one off increases in inventories and consumer spending that would be reversed in Q2.
Actual was +2.4%.
A huge miss, considering that almost all of the data that makes up the GDP numbers was already available.
Goldman's estimate for Q2, before the Q1 numbers came out and before May's abysmal econ data was published was +2%.
No doubt Goldman will be revising their Q2 estimates substantially down before they come out in July.
N.B. As stated before - the economic data did not start turning down until early April.
Goldman also noted in a paper, that was published hardly anywhere, that Global economic growth was not increasing as hoped from the Japanese announcement of massive monetary stimulus.
The paper said it looks like it is only a very brief upward blip.
As I write this, the Japanese stock and bond markets continue to crash - the Nikkei is now down 18% from when Ben Bernanke made his speech under two weeks ago.
As I have said before :-
The CBO will have to substantially revise their forecasts, at some point in the future, to substantially LOWER future estimates of GDP growth.
(And to revise the other extremely optimistic assumptions that they made in their latest revised forecasts.)
They do not stack up with the current economic conditions.
CBO Projections
http://ian56.blogspot.co.uk/2013/03/cbo-projections-of-future-gdp-growth.html
The multiple factors that will cause a US recession
http://ian56.blogspot.co.uk/2013/03/the-multiple-factors-that-will-send-us.html
A summary of global economic conditions
http://ian56.blogspot.com/2013/01/a-global-economic-summary-why-paul.html
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