Not all components of GDP are created equal. Some are very big, and others relatively small. Some tend to be very stable over time, and some tend to swing violently from quarter to quarter. The bigger and more volatile they are, the more they will impact the overall growth rate of GDP. Thus looking at just the percentage changes in the components does not tell the full story. Of the 3.5% total growth, how many points were added or subtracted by each part of the economy? The biggest part of the economy is the Consumer, or PCE -- overall it contributed 2.36 of the 3.50 points of total growth. In the second quarter it caused 0.62 of the 0.70 total decline in the 2Q. In the first quarter it actually offset 0.44 points of the 6.40 total decline. In other words, excluding the Consumer the economy would ...

Over the last several years, politicians have been grappling with the need for sustainable energy. As this discussion has become rather commonplace, investors have become immune to the discussion. Ignoring the possibilities may be an error as there are many ways to profit in the energy sector. As an average investor, oil is often the thought where energy is concerned. There are, however, many forms of energy that may offer profit potential.

The “buzz words” should first be thrown out the door. As past posts have noted, we are still a fossil fuel economy which, regardless of what may be said, is not going to change any time soon. Environmentalists may say what they want but, as an investor, money is made where the money is spent.

Buy low, sell high. This may seem trite but it works. In this regard one may want to consider natural gas. It has been

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For Immediate Release

Chicago, IL – October 12, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Ford (F), Honda (HMC), Caterpillar (CAT), Boeing (BA) and Chevron Corp. (CVX).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Friday’s Analyst Blog:

Trade Deficit Improves

While the year-over-year improvement in the trade deficit is very good news, the reason for it is not so good. It was a reflection of the overall collapse in world trade, something that makes everyone poorer. As far as the GDP calculations are concerned, it does not make any difference

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This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy.

• Andy Xie (Caijing.com.cn): Why one bubble burst deserves another, September 28, 2009. The financial crisis taught crucial lessons about the dangers of bubbles, loose regulation and debt. It’s a pity we didn’t learn.

• John Hussman (Hussman Funds): Zen lessons in market analysis, October 11, 2009. The best way of preparing for the future is to take good care of the present, because we know that if the present is made up of the past, then the future will be made up of the present.

• John Authers (Financial Times): Manufactured surprises will keep stocks rolling, October 10, 2009. A stronger recovery would help earnings but would also bring the risk of higher interest rates to

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In August, the monthly trade deficit fell to $30.7 billion from $31.9 billion in July. We got improvement from both sides as exports rose by $0.2 billion to $128.2 billion and imports fell to $158.9 billion from $159.8 billion in July, a decrease of $0.9 billion. This reverses two months where the trade deficit rose slightly. On the other hand, over the last year the trade deficit is down dramatically. A year ago our imports were $63.6 billion higher than now, at $222.6 billion, and our exports were $33.4 billion higher at $161.7 billion, resulting in a deficit of $60.9 billion. While the year-over-year improvement in the trade deficit is very good news, the reason for it is not so good. It was a refection of the overall collapse in world trade, something that makes everyone poorer. As far as the GDP calculations are concerned, it does ...

How do you like this recovery? Pretty good, huh? Except for the jobs, of course. And except for the retail sales. And except for the foreclosures… and house prices. And incomes. And consumer prices. And business profits. It’s like a female impersonator… just like a real woman in every way, except for the essential ones.

At least stocks are doing well. The Dow rose another 36 points yesterday. In terms of time, it’s already beat the bounce of ’30… it’s in its 6 th month. In terms of stock prices, it’s still a laggard, however. US stocks are up about 45% from their low of 6,547 on the Dow. By that measure, the current reading of 9,398 falls a little short of the 50% increase registered 5 months after the ’29 low.

Yesterday’s news was a big disappointment for mainstream economists. It’s ‘back to the drawing board,’ says the Wall Street Journal.

The

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Some additional observations (see Jim Hamilton's take, as well as others) on the GDP release: (1) the five year revision indicates that GDP was larger than we thought, but it also declined faster in 2009Q1; (2) GDP growth was lower throughout 2008 than earlier estimated; (3) GDP growth in 2008Q2 at 1.5% SAAR would have likely been at zero or negative in the absence of the January 2008 stimulus package in which case; (4) GDP q/q growth would have been negative from 2008Q1 to 2009Q2; (5) the case that ARRA directly affected 2009Q2 GDP is limited, in a mechanical sense since most of the increase in government spending is accounted for by defense spending; and (6) the US ex-oil ex-agricultural net exports to GDP ratio is back to where it was in 1998Q1.

Just a recap: GDP q/q SAAR came in above the -1.6% growth predicted in the

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For Immediate Release

Chicago, IL – July 13, 2009 – Zacks Equity Research highlights Heinz (HNZ) as the Bull of the Day and Xtent, Inc. (XTNT) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Boeing (BA), Caterpillar (CAT) and Microsoft (MSFT).

Full analysis of all these stocks is available at http://at.zacks.com/?id=2676.

Here is a synopsis of all five stocks:

Bull of the Day:

Growth in Heinz’s (HNZ) domestic businesses, strengthening international operations, and the reallocation of resources in favor of key brands are major positive trends for the company.

Despite cost pressure from higher commodity costs, strong pricing of 3.5% to 4.5% has allowed the company to report positive earnings surprises in the last twelve quarters. Management expects net sales to increase by 4% to 6% in fiscal 2010 driven by new

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In May, the U.S. trade deficit fell to $26.0 billion from 28.8 billion in April, a decline of $2.8 billion. For a change, the principal reason for the decline was both a rise in exports -- which rose by $1.9 billion -- as well as a fall in imports -- which declined by $0.9 billion. Most of the previous (and remarkable) decline over the past year or so has been do to imports falling much faster than exports.  True, as the graph below (from http://www.calculatedriskblog.com/) shows, a big part of the decline in imports has been due to a shrinking oil bill. This is both due to lower prices (oil prices peaked out about $145/barrel a year ago) and due to lower consumption. The improvement in the non oil part of the trade deficit, shown in red on the graph, started earlier (late 2005) and has been ...

Plug-In Electric Vehicles: In Search of the Mass-Produced Hybrid

by David Fessler, Advisory Panelist

We found out that Tesla Motors joined the growing list of automakers receiving federal funds this week. It locked up $465 million to develop and produce battery-powered vehicles.

But as we know too well, large government checks are hardly ever the answer to our problems. And one of the biggest right now is that we’re seeing gas prices climb slowly higher.

While $147-a-barrel oil served as a wake-up call for the car-driving consumer, it was also the catalyst that shifted the plug-in electric vehicles industry into high gear (pun intended).

I’ve talked about Plug-in Hybrid Electric Vehicles (PHEVs) before, and I’ve heard a lot of reader comments on the hybrids on the market right now. So let’s take a look at some of the major car companies’ efforts so far, as well as what lies ahead for consumers

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