Why country's GDP is quite irrelevant number, frankly..

[bushi]

this comes from a newsletter I am subscribed to, and indeed, it was quite illuminating:

GDP as a concept is absurd. Government spending is counted as a positive. So a government that spends money digging holes, and refilling them is adding to its country's GDP.

Despite the accurate description of many government programs above - the whole concept above is fundamentally true. So, are you feeling better now, reading that GDP is growing/contracting, or whatever, as a measure of "economic growth"? It truly is meaningless macroeconomic variable, seemingly, and worse still - TARGETING it at some X% a year, is even more nonsense - trying to stimulate/manipulate the reality, to produce some abstract number, at the end of the year, a number that isn't even relevant?


Thoughts, anyone?

 

[pmbug]

Targeting is laughable when they can just change the meaning (composition) of the measuring stick.

http://www.shadowstats.com/alternate_data/gross-domestic-product-charts