June 1, 2009
Why Is Economic News Always Surprising?
Isn’t this an old marketing trick – include “surprising,” “stunned,” or “unexpected” in a headline? It seems to me that every time an economic report comes out, we are presented with one of these words to describe the data.
The latest example comes from cnnmoney.com today:
U.S. construction spending unexpectedly posted its biggest increase in eight months in April, advancing for a second straight month as the private sector put money into both residential and nonresidential projects, according to a government report on Monday.
Oh to be able to surprise a sales manager with an unexpectedly lower sales forecast! If the experts are consistently surprised, what credentials do they have for being experts?
Anyway, I am hopeful that the economy is turning, but I have to question if this is too early of a read. The GM bankruptcy is going to have seismic repercussions on unemployment which is a lagging indicator to start.
