Second estimate of 1Q 2015 GDP and worrisome R&D data

As expected, the second estimate of 1st quarter GDP from BEA shows the economy actually declined by 0.7% (rather than rising by 0.2% as earlier estimated – see earlier posting). Part of the revision was a downgrading of investments in intellectual property products (IPP) – which grew by only 3.6% as opposed to 7.8% in the earlier estimate. The biggest revisions was that R&D investment was almost flat in the 1st quarter — up by only 1.1% instead of the 12.3% growth estimated earlier. Given that today’s estimate is based on the latest R&D data, this is a very worrisome trend.
Of course, this figure could get revised again next month. Stay tuned.
IPP parts 1Q15 - 2nd.png

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