Following this morning’s report of a “better-than-expected” GDP acceleration, Keith McCullough calls the government out for goosing the economy with reckless spending and fudging numbers in an attempt to hide economic reality.
“Government spending has equated to basically a third of the numbers,” Hedgeye’s CEO explains in this clip from The Macro Show. “The way we do it in America now is say, ‘There’s no recession because we borrowed from your children and borrowed from the future’ … That’s why you’re running a $1.7 trillion deficit and have going on $35 trillion in U.S. debt.”
“If you say inflation was 1.5%, when it was actually 3.4% in the most recent report – and as you know, real world inflation’s higher than that – that overstates GDP by 200 basis points. It’s ridiculous.”
“We’ve been trying to separate the economy from the markets, the bubble of it all and the rest of it all,” McCullough adds. “But then you have this third dimension, which is the government making up numbers.”
Watch the full clip above.
