04-21-2020, 12:57 PM
Goldman Sachs makes the Quarter-on-Quarter and Q4 2019 vs Q4 2020 predictions clear in the second summary bullet point:
"We expect declines in services consumption, manufacturing activity, and building investment to lower the level of GDP in April by nearly 10%, a drag that we expect to fade only gradually in later months. We now forecast quarter-on-quarter annualized growth rates of -6% in Q1, -24% in Q2, +12% in Q3, and +10% in Q4, leaving full-year growth at -3.8% on an annual average basis and -3.1% on a Q4/Q4 basis."
So even with a 12% quarter-on-quarter growth in Q3 and then another 10% quarter-on-quarter growth in Q4, they still see Q4 '20 being -3.1% from Q4 '19 (the Q4/Q4 basis).
Assuming we need to do only 1 Shelter-In-Place, and we finally ramp up testing and tracing, I find a -3.1% Q4 '20 vs Q4 '19 a little optimistic, but reasonable. I did say in another thread I think things should be OK, *on average* by Q3, assuming we don't screw things up royally, which we may.
You have to remember that -3.1% Q4 could mean -40% or even -100% for some businesses, counteracted by big growth by other firms. Notably and sadly, as Mick initially noted, this will lead to consolidation and smaller firms will suffer disproportionately. The Walmart grocery app usage was up 460% on April 5 -- that 460% growth by the Walmart grocery app will be offset by an even greater loss by thousands of smaller shops.
"We expect declines in services consumption, manufacturing activity, and building investment to lower the level of GDP in April by nearly 10%, a drag that we expect to fade only gradually in later months. We now forecast quarter-on-quarter annualized growth rates of -6% in Q1, -24% in Q2, +12% in Q3, and +10% in Q4, leaving full-year growth at -3.8% on an annual average basis and -3.1% on a Q4/Q4 basis."
So even with a 12% quarter-on-quarter growth in Q3 and then another 10% quarter-on-quarter growth in Q4, they still see Q4 '20 being -3.1% from Q4 '19 (the Q4/Q4 basis).
Assuming we need to do only 1 Shelter-In-Place, and we finally ramp up testing and tracing, I find a -3.1% Q4 '20 vs Q4 '19 a little optimistic, but reasonable. I did say in another thread I think things should be OK, *on average* by Q3, assuming we don't screw things up royally, which we may.
You have to remember that -3.1% Q4 could mean -40% or even -100% for some businesses, counteracted by big growth by other firms. Notably and sadly, as Mick initially noted, this will lead to consolidation and smaller firms will suffer disproportionately. The Walmart grocery app usage was up 460% on April 5 -- that 460% growth by the Walmart grocery app will be offset by an even greater loss by thousands of smaller shops.