US Consumer Confidence Jumps To A 17-Year High -- February 27, 2018 -- GDP Estimate Slips Well Below 3%

When it rains, it pours.

In the last hour or so:

• turkey vultures circling Citgo, Venezuela;
• US LNG / US nat gas exports establish new records;
• tweets that Tesla is going to miss already-low projections/goals/deliveries in 1Q18 by a wider-than-expected margin (yet to be posted);
• Now this: US consumer confidence at a 17-year high. Being reported by Bloomberg, so you know it has to be true:

U.S. consumer confidence jumped to a 17-year high as optimism about employment prospects grew and Americans began seeing additional money in their paychecks from recently enacted tax cuts, data from the New York-based Conference Board showed Tuesday.

More at the article.

By the way, talk radio suggests that Americans across the board are excited about seeing less money being taken out of their paycheck by the IRS. In some cases the amount of money being "returned" to workers is substantial, but my hunch is that most Americans "hate" the IRS so much than even if they saw one more dollar being returned to them, they would be happy. Even if pesky Pelosi calls it "crumbs" (let them eat bread), the average American worker sees it as something else.

Other details from the linked Bloomberg report:

• share of respondents expecting stock prices to increase in the year ahead fell to 41.3 percent from a record 51 percent;
• 25.8 percent of consumers said they expect better business conditions in next six months, up from 21.5 percent in previous month;
• share of households who expect incomes to rise in next six months rose to 23.8 percent, highest since 2001, from 20.6 percent; and,
• buying plans for homes, major appliances and new cars increased

Bloomberg did not take the opportunity to suggest this was making America great again. They must assume the average reader can connect the dots.

********************************

GDP Now Not Reflecting That Consumer Sentiment

Latest forecast: 2.6 percent — February 27, 2018.

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2018 is 2.6 percent on February 27, down from 3.2 percent on February 16.

After this morning's Advance Economic Indicators and durable manufacturing reports from the U.S. Census Bureau, the nowcasts of the contributions of real nonresidential equipment investment and real inventory investment to first-quarter real GDP growth declined from 0.45 percentage points and 1.20 percentage points, respectively, to 0.37 percentage points and 0.95 percentage points, respectively.

The nowcast of first-quarter real residential investment growth declined from 0.6 percent on February 16 to -4.5 percent on February 26 after housing market releases from the Census Bureau and the National Association of Realtors.