GDP and the Greater Fool Theory
National GDP came out today at 2.84%. That was certainly a beat of the expected 2.5%. The numbers once again proved that nutters like me- are wrong, didn't they? Our economy is excellent and the stock market is fairly priced near 16,000. The Twitter IPO with virtually no earnings is worth 35 bucks a share, right? Enter the Greater Fool Theory. There must always be a greater fool than you who will buy Twitter at 45- so that you can profit at 35. That fool in turn must need someone willing to pay 55. GDP numbers have always been cooked and inflated with the use of inventory. Most of us know that and when today's 2.84 print came out I was a little shocked. At first I was puzzled, because everything I am seeing and reading does not support that kind of number. Then it hit me. The latest government manipulation- thanks to this commenter. The BEA's GDP tables tell us that the gross change in GDP from 2Q -> 3Q was $196.6 billion. But the Fed's QE program in...