US economy kept clicking along in Q3. Why screw this up?

We got another update on how the economy was doing ahead of next week’s election. This shouldn't surprise you if you've paid any attention at all or touched grass in recent weeks, but things are going really well in America.

JUST IN: The US economy is having a remarkable year: 2.8% GDP growth in Q3. That’s in line with expectations and well above the usual norm of ~2% growth.

Strong consumer spending and government spending continue to boost growth. pic.twitter.com/8lJp7sKxhg

— Heather Long (@byHeatherLong) October 30, 2024

Another strong GDP report (2.8% in Q3) pushes real GDP even further above the pre-pandemic forecast. pic.twitter.com/e052qJIdyg

— Jason Furman (@jasonfurman) October 30, 2024

Oh? Let’s look into the report and get more on that.

The increase in real GDP primarily reflected increases in consumer spending, exports, and federal government spending. Imports, which are a subtraction in the calculation of GDP, increased.

The increase in consumer spending reflected increases in both goods and services. Within goods, the leading contributors were other nondurable goods (led by prescription drugs) and motor vehicles and parts. Within services, the leading contributors were health care (led by outpatient services) as well as food services and accommodations. The increase in exports primarily reflected an increase in goods (led by capital goods, excluding automotive). The increase in federal government spending was led by defense spending. The increase in imports primarily reflected an increase in goods (led by capital goods, excluding automotive).

Personal consumption accounted for 2.46% of the increase in GDP, the most that it added to the economy since Q1 2023, and second most since Q4 2021.

See those increases in exports and imports over the last year? Think "Tariff Man" is going to keep that trend going?

If you take out government spending and inventories, the underlying GDP grew by more than 2.1%, which is the fastest growth by that metric for 2024, and the second-fastest growth in 18 months.

Incomes also kept rising in Q3 for Americans.

Current-dollar personal income increased $221.3 billion in the third quarter, compared with an increase of $315.7 billion in the second quarter. The increase primarily reflected an increase in compensation. Disposable personal income increased $166.0 billion, or 3.1 percent, in the third quarter, compared with an increase of $260.4 billion, or 5.0 percent, in the second quarter. Real disposable personal income increased 1.6 percent, compared with an increase of 2.4 percent.

And inflation? Well under control.

The price index for gross domestic purchases increased 1.8 percent in the third quarter, compared with an increase of 2.4 percent in the second quarter (table 4). The personal consumption expenditures (PCE) price index increased 1.5 percent, compared with an increase of 2.5 percent. Excluding food and energy prices, the PCE price index increased 2.2 percent, compared with an increase of 2.8 percent.

Given that the Federal Reserve keeps telling us that the PCE index is what they look at the most on the inflation front, that 1.5% reading should allow the Feds to keep cutting rates next week and in the near future.

Look, I know that TrumpWorld is trying to portray an alternate reality where the US economy is depressed and wracked with inflation. But in the Real America, it’s clear that things continue to thrive under Biden-Harris, with inflation continuing to stay under control, and individuals making more money and being fine with spending it.

And yet the (allegedly) richest man on Earth is telling us that this shouldn’t continue, and that everyday Americans should cut back?

Musk’s closing message — you’ll be worse off with Trump! pic.twitter.com/9PNAPyjFVu

— Matthew Yglesias (@mattyglesias) October 30, 2024

I’ve got a better idea, Elmo. Let’s try to keep the good times rolling for Real Americans that work jobs and pay bills, and any economic or taxing pain that needs to be inflicted will fall on billionaires like you to bring our budget further into balance. Maybe this would encourage you and your fellow oligarchs to invest in products and employees instead of throwing your tax cut windfalls at equally corrupt politicians.

Don’t screw this up, America. We got a good thing going with Dem economic policies today.

In 23, Wisconsin gains big from ILL, a bit from the Upper Midwest, and more Sconnies headed South

I noticed that the US Census Bureau recently released its state-to-state migration report for 2023, and I figured I'd take a look at who was coming and going from our state last year.

Not surprisingly, Wisconsin has the largest number of movers (both coming and going) with two states that border us - Minnesota and Illinois. Wisconsin had nearly 27,000 Illinois residents move to our state and slightly more than 14,000 Sconnies headed south to ILL - a net gain of just over 12,800. Our "trade" of residents with Minnesota was more balanced, a little over 17,000 coming east from Minn to Wis last year, and just over 15,400 coming west over the Saint Croix.

But the third-largest state that Wisconsinites moved to and got people from wasn't nearby at all - it was Florida. And the other highest-mover states to/from Wisconsin are a combination of nearby places in the Upper Midwest, several other warm-weather states in the South and West, and we are getting quite a few people from California.

Expanding out into all 50 states, Wisconsin had a sizable gain of nearly 115,000 people from the rest of the country in 2023, and only had just over 100,000 move out. That's a nice reversal from the first half of the 2010s, when we were often losing out on net migration.

It's a good overall trend, and one that can reduce the limitations of growth that we seemed to be bumping up against a couple of years ago. And gaining from all 4 states that border us (including the lower-population state of Iowa) is a good indicator that we likely doing something right.

Multi-unit home construction down, but more homes of all sorts available now

One headwind in an otherwise strong US economy has been higher interest rates in 2024 and the industries that are being held back as a result. And that's clear when you look at the lack of new projects in home construction.

Housing starts, another name for new home construction, slipped 0.5% in September on falling multifamily starts. Single-family starts moved higher. All regions besides the Northeast reported fewer starts overall.

Single-family starts rose 2.7% in September after August starts were revised up to one million. Starts have trended above one million for eight of the last 11 months. Builders pivoted back to single-family construction in late 2023 after a slump that began in late 2022, but continue to hit the one million-unit speed limit. Larger builders have been able to offer mortgage rate buydowns and other incentives to help sidelined buyers. According to the National Association of Home Builders (NAHB), about 62% of builders were offering sales incentives in October, up slightly from September.

Mortgage rates have not fallen as much as potential buyers had hoped this month, but they have remained below 7% since June. Falling mortgage rates have motivated more refinancing activity rather than new home purchases. Some potential buyers are still holding out with the expectation that rates will go lower. However, the 30-year, fixed-rate mortgage ticked back up to 6.4% in mid-October; refinancing activity slumped on the news.

Starts for multifamily (five units or more) buildings dropped 4.5% in September, which translated to a 15.7% annual drop. As more multifamily units are completed, builders are holding back from starting new projects. Multifamily units under construction have fallen from a record high of one million back in 2023 to 825K in September. The current completion rate is the highest since the early 1970s, but the pipeline is drying up. All the supply coming on line is helping alleviate rental costs in many markets, but the reprieve will be short-lived because the number of building permits issued is falling.

The difference between the high number of completions and units currently under construction is stark over the last 12 months, especially in the multi-family complexes of 5 or more units. Completions have been in an uptrend in America, up 14.6% from September 2023 to September 2024. Interestingly, much of that growth is in multi-units as well, so what we’re seeing in new single-family home construction is relatively steady.

We also got mixed messages on the sales side, as new residential home sales were reported later this week as reaching its highest levels since May 2023, and the second highest level since early 2022, right before the Federal Reserve began their anti-inflation rate hikes. But the National Association of Realtors reported this week that the rate of existing home sales dropped to their lowest amounts since the COVID shutdowns of early 2020, and down more than 40% from where it was 2 years ago.

I also note the NAR report says that home price increases nationwide have leveled off, and are only 3% year-over-year.

By comparison, Wisconsin’s housing market has continued to see larger price increases – up nearly 6% year-over-year for September 2024. But we also had the lowest amount of September sales in 12 years, indicating that more inventory would be nice, as the Wisconsin Realtors Association says that things are still not in balance between buyers and sellers.

Although both total listings and new listings rose in September indicating a slight improvement in inventory levels, the housing market remained tight. With just 3.8 months of available supply, the existing home market continued to signal a strong seller’s advantage, with supply well below the six-month benchmark that indicates a balanced housing market.

In a positive sign, the WRA says that the 100+ point decline in mortgage interest rates and higher incomes made homes more affordable to Wisconsinites than in September 2023, even with the 6% increase in median prices. And perhaps the drop in interest rates will encourage more homes to be put onto the market, as many homeowners have likely been locked in place with a low-interest mortgage that predates 2022, and no reason to look for another home with higher prices and higher rates.

So with that in mind, the question becomes whether the big increase in home completions is going to boost inventory enough to level off prices, and the lower interest rates also can help free up some availability. But will it be too late to head off a decline in home construction employment that the drop in permits and homes under construction seems to portend? Tough call.

It's already WisGOP's Waterloo, and Dane County's growth will boost Harris, Baldwin in 2024.

Recently, I noticed that the Wisconsin Department of Administration released their final estimates of population for Wisconsin communities for 2024. These numbers don't just look at the total population, but also the voting age population (VAP), and with the election looming, I wanted to see what effects population changes might have on the Wisconsin electorate in this presidential election vs the last one.

Overall, the DOA says that the voting age population in Wisconsin has gone up by just over 101,000 people since 2020, or a bit over 1.6%. Not surprisingly, Dane County is leading the way in that growth, with nearly 33,000 more people in its VAP than 4 years ago. The next largest gainer was Waukesha County, with just over 7,000 people, and Brown County, with a gain of slightly more than 5,900.

Then I looked at the results of the 2020 election in each county of Wisconsin, and change both the Dem and GOP vote totals by the same rate as the changes in voting age population. And because heavily-Dem Dane County has grown so much compared to any other county in Wisconsin, it means that solely on the basis of population changes (with nothing else changing), Kamala Harris would do better against Donald Trump than Joe Biden did in 2020.

Overall, these changes in voting age population would turn a 20,600 win for Joe Biden into a win of more than 30,000 for Kamala Harris. And we should set our baselines for Wisconsin counties accordingly when we think about election returns in 2024.

Obviously, many other changes in turnout rates and especially changes in who voters choose will have a larger effect on who ultimately wins our state. But I am telling you that Dane County's continued growth is likely already giving a boost to the chances of Dems Kamala Harris and Tammy Baldwin for November 5, and I think we need to keep that in the back of our heads as the votes come in.

Just like 2022, GOPs giving discouraging polls. Dems outperformed then, why would it change now?

I admit to being someone who updates 538 and related poll prediction sites more than I should. What can I say, I'm into numbers and it's hard to look away. And I know better, because as Dem strategist Simon Rosenberg constantly reminds us, these predictions are being gamed by dishonest GOP organizations.

Part of their new efforts to drive the natl polling average down is addition of a TIPP daily tracking poll. Predictably, and perhaps comically, it showed the race - all of a sudden! - breaking to Trump after 6 weeks of a remarkably stable race and a bad media week for Trump 2/

— Simon Rosenberg (@SimonWDC) October 21, 2024

To be clear - the independent polls last week were +3 to +5 Harris. A steady, stable race. Then boom - red wavers dropped series of polls 2 to 5 points to the right of indep. polling and the averages moved.

This is exactly what they did in 2022. 7/https://t.co/K3uPFIAzAy

— Simon Rosenberg (@SimonWDC) October 21, 2024

And our state is part of this effort. So let’s give a look to what the final result was in these races in 2022, and just how well the pollsters (in the aggregate) got it in these swing states.

Here's what the polls had for Wisconsin's governor's election in 2022.

The Wisconsin Gov Result? Evers +3.4%.

Same thing showed up in the Senate race, which had Ron Johnson up a lot over Mandela Barnes.

The Wisconsin Senate Result? Johnson +1.0%. Think some people might have voted differently if they knew Mandela Barnes had a much better chance of winning than the polls led on?

A similar pattern shows up for 2022 in almost all of the 7 states that are listed as the closest in the nation in this presidential race. For example, here is Michigan's polling in their Governor's race, which indicated a close one.

Final score? Whitmer +10.6%, and Dems took control of both houses of the Michigan Legislature.

If you trusted what polls were telling you, you'd have thought Kari Lake was on her way to a decent-sized win for 2022's election for Governor of Arizona.

FINAL SCORE - Hobbs +0.6%.

But the bigger agenda-setting by GOP fraud pollsters was in US Senate races, where Republicans would gain control with a couple of victories in swing seat races. They even tried to show that ridiculous tech bro Blake Masters had momentum against Mark Kelly in Arizona's Senate race in 2022.

Actual result? Kelly +4.9%.

Another weirdo GOP that TrumpWorld tried to push into the Senate in 2022 was TV huckster Mehmet Oz, who tried to hold onto a Senate seat against Dem John Fetterman. And the GOP pollsters really tried to convince people that Fetterman was fading in the last month of the campaign after suffering a strike.

The result at the ballot box? Fetterman +4.9%.

In Georgia, another Trump-picked weirdo was on the GOP side, in former NFL trade target Herschel Walker. He was trying to boot out incumbent Senator Rafael Warnock, and polls said Walker had a good chance of getting the job done.

The November result? Warnock +0.9%, although neither candidate got a majority, and Warnock had to win a runoff election a month later.

In North Carolina, pollsters had indicated Ted Budd had broken away in a close Senate race, which would have sent a message to Dems not to go hard after this seat.

Final result? Budd +3.2%. A lot closer than the polls were telling the public.

Lastly, GOP pollsters also tried to make it look like GOPs were going to defeat Catherine Cortez-Masto and flip one of Nevada's 2 Senate seats.

Result? Cortez-Masto +0.9%. And even when GOPs won another close race in Nevada, with Joe Lombardo in unseating Governor Steve Sisolak by 1.4%, it wasn't by as much as the pollsters indicated. Especially the GOP-sponsored ones.

Lot of pro-GOP misses in there, and not by a little. But that's by design. A central Trump/GOP strategy is to try to project an image of strength and inevitability, and trick casual and low-info voters into backing Trump and other GOP "winners". Making up polls that lean GOP is also a way to try to encourage lazy journalists into giving a theme of "Trump winning/Trump has momentum" that can misdirect from that dimwit's significant flaws and the fact that GOP positions are out of step with the mainstream.

But in 2022, these fake polls didn't change the reality that Dems were leading, and they were the choice of the public in almost all of these contested swing state races. Here in Wisconsin, we've also seen Dems have convincing wins in both the April 2023 Supreme Court race, and the August 2024 referendum. Dems have also generally done well in elections of all sorts in swing states since the Dobbs decision came down.

So why would we think that 2024 would be any different, and that Democrat Kamala Harris shouldn't be favored in most if not all of those states? Especially when the economy is better than in 2022, Trump is noticeably more feeble and desperate than he was in previous elections, and the Harris-Walz campaign looks confident and is trying to expand their base instead of be in fear of losing what they have?

It's not guaranteed by any means, and we need to keep working at it for these next 2 weeks. But what makes us think that in the Real America, Dems shouldn't be favored, no matter what slanted polls might be saying?

Nice try dweeb, but wages for workers have not fallen behind under Biden-Harris

If you're one of my 5 regular readers, you know that one of the things I can't stand is GOP dishonesty. Like this stuff from a Heritage Foundation Koch-sucker.

Why are people so dissatisfied w/ the economy? B/c cumulative inflation since Q4 '20 exceeds 20%, eclipsing earnings growth so that your larger paycheck buys you less; you're demonstrably worse off - almost 4 years and no progress: pic.twitter.com/rwAY1O8WnX

— E.J. Antoni, Ph.D. (@RealEJAntoni) October 19, 2024

Hey EJ! Know what else was happening in Q4 2020? A US unemployment rate of 6.7%, mostly because we were still in a pandemic where US deaths were 30-50% higher than expected during that quarter.

And the types of jobs that made up a whole lot of that unemployed? The leisure and hospitality sector, which incldued bars and restaurants being down 2.5 million jobs from the pre-COVID peak, accomodation services was down nearly 800,000 and arts, entertainment and recreation was down more than 3/4 of a million jobs at the end of 2020.

That was more than 1/4 of the 9.8 million-job loss of Americans at the time, well above the 11% jobs that those 3 sectors accounted for in the pre-COVID peak of February 2020. In addition, the leisure and hospitality sector had average (nominal) weekly wages of $438 in the last 3 months of 2020, well below the Q4 2020 median of $983. (Yes I know average isn't exactly the same as median, but you get the idea).

So this means the average weekly wage would be higher in Q4 than normal, solely because a lot of jobs were lost in those low-wage sectors. Conversely, between December 2020 and December 2021, as Americans got vaccinated and more economic activity in travel and personal contact industries resumed, the US added 7.25 million jobs, with 2.46 million (34%) of those jobs coming back to bars/restaurants, accomodation services, and arts, entertainment, and rec.

would And even though average weekly wages in the leisure and hospitality industry had jumped to $507 from $438 a year ago (a 16% increase!), it was still barely half the overall median weekly wage of $1,009 at the end of 2021. Needless to say, with more of the restored jobs being in lower-wage industries, that'll drive the median weekly wage down.

So let's do a fairer comparison, which is to look at where real median wages are compared to 2019, or even Q1 2020 (as most of the job losses didn't hit until mid-March and so the wages won't be too distorted). And it gives a much different look than what Heritage's boy wants to tell you about.

Yes, there may have been no change for median weekly wages between the end of 2019 and 2021, but that hides the fact that higher-wage earners weren't getting the amount of gains that lower-wage workers got. And since inflation peaked in the middle of 2022, we've seen real gains of 3.3% over the 9 quarters since then. Pretty darn good if you ask me.

But even though you may have already figured out that things were better than 2020 just by thinking about it for a few seconds. EJ Antoni isn't getting his "charity-funded" salary at the Heritage Foundation to give honest assessments. And the fact that it takes this amount of explanation to show just how full of shit that guy is helps to explain why him and other Trump/GOPs try this dishonest "THINGS COST MORE THAN 4 YEARS AGO" theme, without explaining why or giving any policy that would help Americans pay less.

In fact, we know that the policies promoted by Trump and the real agenda-setters at Heritage's Project 2025 would cause inflation to fire back up, instead of keeping it under control like it is today. But alleged PhD EJ Antoni (who has never had a job outside of wingnut welfare) isn't going to tell you that, either.

As Wisconsinites start voting, the jobs market is in great shape here.

As the November election looms in this battleground state, we got more good news about the Wisconsin jobs market.

The Wisconsin Department of Workforce Development (DWD) today announced new record-high employment during September 2024, according to preliminary estimates from the U.S. Bureau of Labor Statistics. This is the fifth consecutive monthly record for state employment, highlighting the unprecedented number of workers participating in Wisconsin's economy.

Preliminary employment estimates for September 2024 showed Wisconsin's seasonally adjusted unemployment rate remained at 2.9%, which is 1.2 percentage points below the national unemployment rate of 4.1%. The state's labor force participation rate increased to 65.6% in September while the national rate stayed at 62.7%.

• Place of Residence Data: Wisconsin's unemployment rate was 2.9% in September, 1.2 percentage points below the national rate of 4.1%. Wisconsin's labor force increased by 6,700 over the month and 1,300 over the year. The number of people employed increased 7,700 over the month to a record-high 3,059,700 employed.
• Place of Work Data: Total nonfarm jobs decreased 4,000 over the month and increased 30,800 over the year to 3,044,800 jobs.

But even the loss of 4,000 payroll jobs isn't as bad as it sounds, as a "loss" of 7,300 jobs in state government appears to be the result of a large number of UW employees starting work in time to be recorded in the August report when the model counted on them not being recorded until September.

In the private sector, the state added 2,100 (seasonally-adjusted) jobs in September, continuing a multi-year trend of solid job growth in both the private sector, and overall. Even after people had returned to work following the COVID cutbacks.

On the household survey, this was the 7th straight month where the state's unemployment rate was under 3% (if you don't round), and the 2.86% rate for September was the lowest since May 2023.

And since the Biden-Harris Administration started, nearly 60,000 fewer Wisconsinites are unemployed, and nearly 100,000 more are working.

All of this looks pretty good to me. Wisconsin has even had our labor force rebound from a downtrend that started in 2017, which had been a real economic limitation for our state.

Seems like we would want to keep this going instead of having the chaos and likely decline that would hit with the return of Trumpian BS to the White House.