Grudging Growth

Q4/15 GDP growth was recently revised up to 1.4%. The data continue to show an economy being driven primarily by consumer spending on services and secondarily by housing. It’s being held back by business investment, manufacturing, energy, bloated inventories and exports. Business profits continue to shrink but employee compensation was 53.6% of GDP in Q4, up from 52.8% a year earlier. Q1/16 GDP growth looks very weak at 1%.