Locator: 49745GDP.
In a long note like this, I may have made some typographical / content errors -- keeping track of the colored bars and the respective could get confusing.
The links:
- the graphic; and,
- prompt: the GDP formula.
The formula:
The first reading, 3Q25 GDP:
This graphic is very, very clear. At least to me. But even with three Google prompts -- more specific each time -- I was unable to get a clear explanation.
Note the y-axis -- on the right-hand side. It's very clear that the colored bars above the mid-line (the 0% line) -- above 0% -- were positive contributors to the GDP -- the black line.
In 3Q25, there are four bars above the zero-percent line, and the GDP black line matches the top of the colored bars. There are no "colored bars below the "0-line." The "blue bar" -- net exports of goods and services -- did not show up at all suggesting it contributed nothing to the 3Q25 GDP (first reading).
In 2Q25, the "blue bar" -- private investment -- extended to the -4.5% line (450 basis points below the "0-line," suggesting that private investment was a drag on the 2Q25 GDP. [Folks should be able to explain that; I would do that but I don't need the pushback.]
Meanwhile, in both quarters, the "green bar" --net exports of goods and services -- had a significant effect on the GDP (black line).
Second observation: If the blue bar had extended 300 basis points in 3Q25 like it did in the first two quarters of 2025, the graph would have put the GDP (the black line) well over 6%.
Third observation: a CNBC talking head said that "Health Care" -- the orange bar -- contributed an outsized amount to 3Q25 GDP (first reading). Most would agree that consumers paying more for "health care" is good for the corporations, perhaps for the US government, but not good for the consumers, all things being equal. It simply means health car has gotten more expensive if consumers are paying more, quarter/quarter or year/year.
But, now that we have the graph, we can decide for ourselves to the extent Health Care contributed to 3Q25 GDP (first reading). Going back to 3Q22, the Health Care component is about the same.
Fourth observation: the orange bar doesn't even show up in the first two quarters of 2022, still in the Covid-19 lockdown period.
Fifth observation: the #1 question -- why is the blue bar completely missing in the latest quarter and was was the blue bar so incredibly negative in the prior quarter.
Sixth observation: it would be nice to hear an unbiased explanation for the huge green bar below the "0-line" in the 1Q25, and the incredible flip the following two quarters.
If I were an economics professor I would assign the students to provide a five-page double-space letter explaining this graph. They can use a chatbot as much as they want. One-fourth of the students would be randomly called before the class and explain the three most important points in their five-page analysis. They would not be told ahead of time; the only thing they would be told -- submit a five-page analysis of the graphic.
It would be great for CNBC to show this graphic and have Steve Liesman and Rick Santelli and hash it out. Rick, of course, would report objectively; Steve, not so much.
Jargon: by the way, the formula above is called the "GDP deflator" because is a price index that is used to "deflate" nominal GDP (GDP measured in current dollars) into real GDP (GDP measured in constant purchasing power). -- ChatGPT.
