The federal office and the gdp figures
the federal office and the gdP figures

The "calculation" of a GDP decline of only 0.1 percent in the second quarter of 2019, as presented by the Federal Statistical Office for today, is not covered by the primary statistics. The reasoning behind the office can only be described as absurd

Quasi-stagnation in the second quarter?

The Federal Statistical Office today published a figure of minus 0.1 as official statistics for the development of GDP, which in turn (like the figure for the fourth quarter of 2018, cf. our criticism here) cannot be justified by anything. In view of the sharp decline in the familiar figures from the primary statistics, primarily in manufacturing output, there can be no talk of near stagnation in GDP.

Also the reason given by the Federal Statistical Office is, one cannot print it differently, absurd. The Office writes:

According to preliminary calculations, positive impetus came from the domestic market in a quarter-on-quarter comparison (real, seasonally and calendar-adjusted): private consumer spending was higher than in the 1. In the second quarter, the government also increased its consumer spending. In addition, more was invested than in the first quarter. quarter, although construction investment was lower. The development of the economy slowed economic growth in the..

Federal Statistical Office

There is no justification for talking about an increase in investment in the face of a significant drop in domestic demand for capital goods and a clear decline in production in the capital goods industry. Domestic orders for capital goods, which is clearly the most important indicator of the domestic propensity to invest, were almost five percent lower in the second quarter than in the first quarter. The production of capital goods is almost two percent below that of the first quarter.

Private consumption, according to the primary statistics, is also weak. Retail sales have practically not increased from the first to the second quarter and new orders in the motor vehicle industry (motor vehicles are not included in retail sales) have also declined sharply.



Subsequent corrections

The extent of the uncertainty surrounding these figures is shown by the subsequent corrections published by the Federal Office itself in this report. The Federal Office admits that the quarterly figures were subsequently corrected by up to 0.6 percentage points. The preliminary (and already extremely questionable) stagnation of the last quarter of 2018 has now turned into an increase of 0.2. "For this" the sharp increase from the first quarter of 2018 of originally 0.4 percent is now only a hint of 0.1 percent. The fact that the Office adds the comment that the overall economic picture has not changed is probably meant to be ironic.

All in all, it can already be said that the GDP figures have nothing whatsoever to do with economic development and must therefore be eliminated once and for all from the circle of indicators to be taken seriously. The Federal Statistical Office is responsible for the fact that policymakers allow themselves to be misled by these indicators – although this can certainly never be claimed.