The BEA revised fourth-quarter GDP from +3.2 Percent to +3.4 percent. Real GDI was a whopping +4.8 percent but discrepancies remain and charts tell a better story. 
Chart Notes
- Gross Domestic Product (GDP) and Gross Domestic Income (GDI) are two measures of the same thing. Product produced should match sales and income. They do over time, but this is a large ongoing discrepancy.
- Real Final Sales is the bottom line estimate of GDP. The difference between GDP and Real Final Sales is inventory adjustment which nets to zero over time.
- Real means Inflation adjusted using the GDP deflator as calculated by the BEA as the adjustment.
GDI reporting lags GDP reporting by a month in the first three quarters of the year and by two months for the fourth quarter.
Due to lags, GDP gets all the media writeup, but many economists and analysts, me included, think GDI is a better number.
Real GDP, Real Final Sales, Real GDI 2023
Percent Change From Previous Quarter, Annualized
- Real GDP: +3.4 Percent
- Real Final Sales: +3.9 Percent
- Real GDI: +4.8 Percent
GDI caught my attention but it is not as strong as it looks. The 2023 annual total for GDP is +2.5 percent but GDI is only 0.5 percent.
Price Indexes
- The price index for gross domestic purchases increased 1.9 percent in the fourth quarter, the same as in the previous estimate.
- The personal consumption expenditures (PCE) price index increased 1.8 percent, the same as the previous estimate
- The PCE index excluding food and energy prices increased 2.0 percent, a downward revision of 0.1 percentage point.
If the measures of inflation are understated, them Real GDP and GDI are overstated.
Contributions to GDP 2023 Q4 Final
Real GDP and Real GDI Percent Change from Same Quarter a Year Ago
I created that chart today to better highlight the GDP to GDI discrepancy.
Year-over-Year GDI was essentially flat for four consecutive quarters while GDP rose 0.7%, 1.7%, 2.4%, and 2.9% for the same periods.
In the fourth quarter, GDI did jump 1.9 percent from a year ago vs 3.1 percent for GDP. The 2023 annual total for GDP is +2.5 percent but only 0.5 percent for GDI.
Happiness
In the US, if things were really so great, why are so many people so unhappy?
The answer is asset holders are doing well, renters aren’t. The renters are zoomers, millennials, and blacks.
Many of those who want to buy a home are priced out and have other financial difficulties.
Credit Card and Auto Delinquencies Soar
Credit card debt surged to a record high in the fourth quarter. Even more troubling is a steep climb in 90 day or longer delinquencies.
Record High Credit Card Debt
Credit card debt rose to a new record high of $1.13 trillion, up $50 billion in the quarter. Even more troubling is the surge in serious delinquencies, defined as 90 days or more past due. For nearly all age groups, serious delinquencies are the highest since 2011.
Auto Loan Delinquencies
Serious delinquencies on auto loans have jumped from under 3 percent in mid-2021 to to 5 percent at the end of 2023 for age group 18-29. Age group 30-39 is also troubling. Serious delinquencies for age groups 18-29 and 30-39 are at the highest levels since 2010.
Generational Homeownership Rates
The above chart is from the Apartment List’s 2023 Millennial Homeownership Report
Those struggling with rent are more likely to be Millennials and Zoomers than Generation X, Baby Boomers, or members of the Silent Generation.
The same age groups struggling with credit card and auto delinquencies.
Conclusions
Two different polls show millennials and zoomers are unhappy. And they are unhappy for the reasons stated: Many have concluded they will never be able to afford a house or have kids. Those who have concluded that are likely correct.
For more discussion, please see US Drops to Number #23 in the World Happiness Report
Globally, the US is doing better than the most of the world.
For discussion, please see Expect a Financial Crisis in Europe With France at the Epicenter
Personally, I am very happy. In part, because I focus my attention every day on improving my life (health, wealth, family, friends), rather than wasting my time on nonsense conspiracy cults, and bitching about things I cannot control, like so many here.
In addition, I do not spend my time worrying about the “next” recession, or depression. Rather, I spend my time looking for opportunities no matter what the economic conditions are. Recessions are just another opportunity.
Such a good boy, so much better than most here.
GDI ? Generic Digital Infrastructure ?? Why the fck can t you be bothered to name things by their real name ?
No matter how you interpret the numbers you can’t say the economy is tanking. Seems to be accelerating somewhat.
Everytime the fukin DC criminals hand out an extra couple trillion above budget every few months, the ponzi economy accelerates. When THE PEOPLE finally sack up and force congress to STOP SPENDING it ALL TANKS. Only a matter of time
“When THE PEOPLE finally sack up and force congress to STOP SPENDING it ALL TANKS.”
But we aren’t going to sack up, are we? That would result in an uncomfortable drop in the standard of living. No one is even willing to stop flying off on vacations to “save the planet.”
In aeronautical terms, we are going to ride it into the ground.
Ride it to the ground or fly off to find a planet with intelligent life. /s
Like Hank says : the Ponzi scheme….of total desperation …
Accelerating? No the economy is surging and it is across the board. Profits, wages, sales and employment is surging across all industries
The real inflation number is approx 8%
Now do the math properly
An example of a Marathon Bus: link to marathoncoach.com
They are more expensive now than when we bought ours….ten years ago.
Are you trying to impress us and if so why?
“The answer is asset holders are doing well, renters aren’t. The renters are zoomers, millennials, and blacks.”
Mish, you are missing a HUGE sector that goes unreported: There are MILLIONS of Boomers renting Mobile Home Spaces and RV spots. HOW WOULD I KNOW THIS?
My wife and I are full-time Worldwide Travelers. We sold all of our homes and rentals. We DOWN-SIZED and Bought a Prevost RV BUS (Made in Canada and USA, a “Marathon.” Now, granted, we are in the upper range of RV owners but we decided that we will NOT die with Money left or certainly not ALL of it. So, we spent the Money ($985,000).
So, we travel part time here and rent in Europe part time (Winters, Portugal). WE RENT RV spots here and rent a storage Spot here. When we leave, I “winterize” our RV.
Our many friends (hundreds) are from all walks of life, from Trailer people, to RV BUS people like us and all in between…some of them are Millionaires…. and most are not ….and many are SOC SEC CHECK to CHECK.
WE ARE ALL RENTERS, in effect. Of course, I never miss a payment. We own our Spot in the West (we bought it, so to speak and pay Co-Op fees which covers the infrastructure and power/water/sewer.
Renting RV spots now in Cal or FLA: $3,000 a month in the Fla Keys and $1800 a month here on the Coast. There are FAR cheaper spots as well but we want beach access and fishing is right where we are this coming Month, to Nov 1st when we fly to Lisboa.
What about these tent cities that are always reported on the news?? Who is primarily living in a tent full time?
Biden says inflation is low. Of course anything he says is suspect. People are unhappy because inflation is theft. The morons running the country are thieves, liars and extremists.
Biden also said he frequently commuted over that deceased Baltimore bridge by train. Never had tracks. /eyeroll
Comparing the GDP of a service sector or ‘FIRE’ (finance, insurance, real estate) economy such that exists in the US is not a very good indicator of economic growth and is almost meaningless to compare to an industrial or manufacturing economy. As simplistic as it sounds but a good measure of economic growth is growth in electricity consumption. Do that and compare the US to any growing industrial economy and you’ll see that the US and the West as a hole are falling behind in economic growth and standard of living.
It’s true energy backs all production but it doesn’t quite demonstrate the productivity improvements. What is productivity except doing more with less? The reason governments feel fine with a 2%+ inflation rate is they can outright steal any productivity improvements.
“as a hole”. Pretty sure that’s a typo, but it’s still correct.
It’s what my Italian grandparents called the tax man, or anybody coming to collect bills.
So someone in the GDI calculation department got a tap on the shoulder after more people started noticing the discrepancy was too large with GDP
Are the GDP reports inflation adjusted? I should know this but I do not.
If they are not, then if inflation is 3% and GDP is 3%, wouldn’t that mean that GDP really didn’t go up at all?
this is real gdp so inflation adjusted – that is if you believe the inflation numbers
What they put out is real GDP adjusted by a baloney inflation deflator which they don’t believe either, but job description says it must be published.
I thought that was the role of the GDP Deflator number (today reported as 1.6%. Someone please set me straight.