Predicting faster growth, US GDP
January 26, 2023
1 minute read
Our track record
Higher not lower
January 26, 2023
1 minute read
- Tonight fourth quarter US GDP will be announced,
- US results have been coming out for the last week & we have 9 of the stocks under our coverage reporting so far.
- Can those results help us to make a SHARPFOKUS bottom up prediction for the US total GDP (nominal)…? Yes we think they can.
Our track record
- GDP is basically aggregate sales of everything in the economy.
- So we can add together the sales of all the companies we cover & then calculate the year to year growth rate.
- Historically, using only the 9 companies which have reported so far, there is a very close (visual) correlation between the sales growth & GDP growth.
Higher not lower
- Both sales growth & GDP growth have slowed down in recent quarters, from a peak of about 17% in early 2021 (from a low base in 2020).
- By the beginning of 2022 the growth rate for both was back at a single digits 9%. But in the third quarter growth picked up again despite higher interest rates.
- Fourth quarter SHARPFOKUS sales growth is back at over 14%. That should mean a positive faster GDP growth tonight.. let’s see.