Cramer Gets It Wrong With “Mass Panic” GDP Forecast
Paul Joseph Watson
Friday, August 27, 2010
UPDATE: Cramer’s 0.5pc GDP forecast was way off the mark. GDP has been revised down to 1.6pc, but this still outperformed most economists’ expectations. How did Cramer get it so wrong?
CNBC’s Jim Cramer is predicting that a shockingly low GDP figure today will create “mass panic” in the stock markets today, forecasting that gross domestic product will slip to 0.5 per cent, a figure that will all but guarantee the United States is heading for a double dip recession.
Most economic analysts expect a drastic downgrade of GDP figures for the second quarter from 2.4pc to around 1.4pc, but Cramer’s forecast of a mere 0.5pc would send chills through the market and stocks would undoubtedly plummet in a similar fashion to their May 6 “flash crash” where the Dow experienced a sudden drop of almost 1,000 points.
“Look, I’m going to give you my forecast right now – I think we’re going to get 0.5 percent GDP, OK?” Cramer said. “But, let’s say we get 0.5 percent GDP. Everyone’s going to say it’s horrible. We’re going to go track down economists, Nobel winners who think it’s a double dip. And it’ll be like shocker – 0.5 percent. And I’m telling you it’s going to be 0.5 percent. It’s like the housing number. On my show I said it’s going to be declined 50 percent. We get 30 percent. It was like shocker. Whoever is making these estimates is just so wrong because you know, you piece these pieces together on a daily basis like I do and come up with something between zero and 1 percent growth. So when it comes out as 0.5 percent – other people are – I don’t know who those people are. I don’t know who they’re listening to or talking to. But it’s very clear that we’re going to have no growth. Why is that shocking?”