WTF does this mean... national income up, GDP reported as being awesome... all because of the ABS including a revision in primary income credits from non-residents?? Huh?
I guess that fixes the economy then.
I guess that fixes the economy then.
$4.8bn found down the back of the couch doesn't leave much confidence in GDP figures
The release of the latest GDP figures brought good news. As expected, the economy grew strongly and rather more unexpectedly, the national income also took a sharp jump. But rather than any great investment or government initiative, this jump was due to a large revision by the Bureau of Statistics and it is a revision that certainly was not observed among workers, whose wages and hours worked continued to stagnate.
For the past few years, as the economy transitioned out of the mining boom, economists and policy makers have been worried about the lack of income growth. The ABS's measure of economic wellbeing, "real net national disposable income," had declined for six straight quarters from September 2014. In March, the run of declines ended with a laughably small increase of 0.03%, and the annual growth was still falling by 1.1%.
Well, worry no more!
In the latest figures released on Wednesday, the ABS revised the figures, taking into account a change in the calculation of "primary income credits from non-residents."
The net result was that in March the ABS found $4.8bn in income down the back of the couch that we didn't know about:
It meant that instead of falling by 1.1% in March, Australia's economic wellbeing was actually growing by 0.4% and in June the growth is now up to 2.1% the best for four years:
It's a fairly massive revision one that doesn't leave you with a lot of confidence.
...It isn't helped by some oddities in the latest seasonally adjusted GDP figures. The figures estimated that Australia's economy grew by 0.5% off the back of a surge in public investment and spending, which more than made up for a fall in net exports and private investment.
Praise be to government spending!
...In seasonally adjusted terms, public investment contributed 0.65% points to quarterly growth that is larger than the actual 0.5% growth in the overall economy. In effect if you took away that government investment, the economy would have gone backwards.
But while around a fifth of that public investment came from the federal government, mostly via the purchase of Chinook helicopters, the big chunk came from the states and local government especially Victoria and Western Australia.
Without getting too deeply into the weeds, in Victoria, state and local government investment apparently grew in the June quarter by 59.6% the biggest jump on record:
More: https://www.theguardian.com/busines...h-doesnt-leave-much-confidence-in-gdp-figures
