A deluge of data rolled in this week, clarifying that the US economy continues to outperform even the more upbeat forecasts, like our own. An extraordinarily strong trade report, which was doubly biased by swelling exports of gold and plunging imports of pharmaceuticals, boosted the Atlanta Fed’s GDPNow estimate to a whopping 5.4% for the fourth quarter – which is clearly an overstatement. Still, after the first quarter’s tribulations, GDPNow was adjusted to eliminate swings

Happy New Year! As last year ended, we continued the string of much better-than-expected economic indicators with the stunning 4.3% annualized growth rate for real GDP in the third quarter. Clearly, exports had a lot to do with the number – and in many ways it is a fill for the very weak -0.8% growth rate reported for the first quarter. However, even without exports, growth in final sales to domestic purchasers was up at a 2.9% annual rate. Perhaps even more stunning was the

Policy dominated the week, as key economic data remains scarce. Naturally, the decision by the Federal Reserve to lower interest rates by another quarter point was the focus – with three conflicting dissents and the decision to start buying $40 billion a month in short dated government paper confusing forecasts of its economic effect and future FOMC actions. On the fiscal side, the failure to pass either a Democrat or Republican supported health care bill means a big rise in