Outlook for Q3 Improves

Here’s an interesting chart. This shows the Intrade contract betting that third-quarter GDP will be positive.

When the market was at its low in March, it was widely assumed that Q3 would be another bad quarter. Since then, the outlook has steadily improved and now it’s assumed that GDP will be positive. (Don’t read too much into that last downward data point, it seems to be a trade going off at the bid.)
One positive quarter doesn’t mean the recession is over. Also, it’s possible to see the numbers jump thanks to inventory rebuilding which may not mean that the underlying economy is improving. Still, the Intrade contract seems to match the resurgence of stock prices. We won’t get our first report on Q3 until late October.

Posted by Eddy Elfenbein on August 11th, 2009 at 10:29 am

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