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« The New York Times Attacks Richard Syron | Main | A Self-Inflicted Nightmare? »

August 06, 2008


David Merkel

Though I could have done better with this piece: , I did try to grapple with some of the issues... mainly that the economist cited in the Reuters piece was not treating the data properly.

That said, the GD Product numbers and the GD Purchases numbers tell a richer story together than separately. Import prices do make a difference to how consumers feel about the economy, particularly crude oil.

gaius marius

also -- with all due respect to tim plaehn -- i think he would be better served to contextualize the current conditions with more nuance than simply to suggest a 10-month median recession. menzie chinn provided a view toward a wonderful empirical framework today.

gaius marius

i really thought hamilton and chinn explained it as well as is possible. there's certainly nothing 'conspiratorial' going on in the gdp calculation.

but i do think the difference between the gdp deflator and, say, the gross domestic purchases deflator highlights an eternal truth: no one number encompasses the reality. gdp figures are useful, but in this case the effects the method is not designed to capture are important -- which is why it isn't unserious to contextualize the data by applying different deflators.

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