The Crushing Weight of GDP

Talk about a Goldilocks economy. In this one cycle of revisions, we have seen articles about how the economy was, at 3.5%, too hot, then, at 2.2%, too cold, and finally, at 2.5%, just right.

And what did the very best of the business media have to offer? Even The Wall Street Journal, considered by too many to be the financial bible, writes about Thursday's revision without even mentioning the originally reported 3.5%!

That is peculiar -- because explaining this dance done around revisions is the key element to informing investors, which is purportedly the Journal's mission.

But maybe they have reason to sweep that 3.5% number under the carpet.

After all, back in January -- when what The Business Press Maven was angrily calling a temporary number was reported, The Wall Street Journal was busy legitimizing it at face value in a headline before drawing all sorts of false conclusions about the economy which -- before the subsequent two revisions -- was hot.

Look at this lead:

"If the housing slump has the potential to sink the U.S. economy, that danger wasn't evident in the latest data on economic growth. In the fourth quarter, consumers did more than enough shopping to offset a sharp drop in housing, propelling the nation's economy to a seasonally and inflation-adjusted growth rate of 3.5%."

The Journal, to it's measured credit, was one of the few news outlets to even mention the possibility of a subsequent revision, burying the line "Though still subject to revisions," halfway through the article, before it was off an running at the mouth again: "...the solid GDP report amply exceeded economists' expectations and adds credence to the idea that the Federal Reserve's inflation-fighting efforts, which some had worried would trigger a recession, haven't broken the economy's momentum." An economist is soon quoted saying: "The soft landing is over, and I'm not even sure there was a landing."