Ep10: Deconstructing GDP, Inflation, and Unemployment Economic Indicators for Investors

Welcome to the Broken Pie Chart Podcast Episode 10. In this episode Derek Moore discusses some economic indicators that matter to investors. Many people hear the terms GDP, Inflation, Unemployment, and the Fed Funds Rate but aren't exactly sure what they really mean. We look to deconstruct these popular indicators and show how they are important to investors.

Key Takeaways:

• • What is Inflation and the Consumer Price Index or CPI?
• • What is GDP (Gross Domestic Product)?
• • What is the difference between real and nominal returns and indexes?
• • How is unemployment in the US constructed?
• • Who gets included and excluded from unemployment numbers?
• • Does people working two jobs impact the unemployment figures?
• • Hedonic adjustments to CPI
• • How CPI uses substitutes to put in and take out items from the basket
• • How the economic indicators can help determine future Fed Funds changes
• • Nominal versus Real GDP
• • Employment indicators like Quit Rate and Labor Force Participation
• • Measuring Wage Growth in the economy
• • How Social Security cost of living adjustment or COLA is calculated?
• • When is GDP number released?

Mentioned in this Episode:

Broken Pie Chart Book by Derek Moore https://amzn.to/2MibTSk

Real GDP Growth Rate https://fred.stlouisfed.org/series/A191RL1Q225SBEA

Unemployment Rate https://tradingeconomics.com/united-states/unemployment-rate

US Atlanta Fed Wage Growth Tracker https://www.frbatlanta.org/chcs/wage-growth-tracker.aspx?panel=1

Atlanta Fed GDP Now Forecast https://www.frbatlanta.org/cqer/research/gdpnow.aspx

CPI All Urban Consumers https://fred.stlouisfed.org/series/CPIAUCSL

Inflation Rate https://tradingeconomics.com/united-states/inflation-cpi

Shadow Stats Alternative Inflation Charts http://www.shadowstats.com/alternate_data/inflation-charts