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## historical trend

## Background information

See the detailed descriptions for the two parts for how this question will resolve.

To emphasize:

1) rates of change reflect seasonally adjusted GDP, and are annualized (roughly four times the corresponding quarterly rates of change, but more precisely the annualization process turns a quarterly rate of change r into an annual rate of change (1 + r)^4 - 1). "SAAR" is an abbreviation for a seasonally adjusted annualized rate.

2) SAAR rates of change in RGDP and NGDP are rounded to the nearest 0.1% for resolution.

3) The rates of change are computed from the **advance** estimate for Q3, and the **most recent** (as of October 29) estimate for Q2.

Because of the way scaled questions work, if either RGDP or NGDP growth is negative, the corresponding part of the question will resolve at 0%.

## More information about the possible answers

## % change (SAAR) in RGDP

On October 29, 2015, at 8:30 AM (Eastern), the U.S. Bureau of Economic Analysis is scheduled to release its advance estimate of 3rd quarter Gross Domestic Product. The first part of this question asks you to predict the percent change from 2015 Q2 to 2015 Q3 in **real** GDP, measured as a seasonally adjusted, annualized rate of growth. This value will be reported in Line 1 of Table 1.1.1 of the National Income and Product Accounts, which will be available shortly after the announcement at the URL http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1#reqid=9&step=3&isuri=1&903=1. (It will also likely be prominently reported in the press release at http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm, which should be available at precisely 8:30 AM on the announcement date.)

We will round the growth rate to the nearest 0.1% for resolution.

Note that the growth rates will reflect the **most recent **estimate for Q2 GDP, versus the **advance estimate** for Q3 GDP.

## % change (SAAR) in NGDP

On October 29, 2015, at 8:30 AM (Eastern), the U.S. Bureau of Economic Analysis is scheduled to release its advance estimate of 3rd quarter Gross Domestic Product. The second part of the question asks you to predict the analogous SAAR of growth in **nominal **GDP. This value will be found in cell F283 of the spreadsheet hosted on the BEA website at URL http://www.bea.gov/national/xls/gdpchg.xls, once it is updated on October 29. It can also be computed from Line 1 of Table 1.1.5 of the NIPA tables at http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1#reqid=9&step=3&isuri=1&903=5, via the formula (1 + r)^4, where r = (GDP2015Q3 – GDP2015Q2) / GDP2015Q2, with the (seasonally adjusted) GDP values for Q3 and Q2 extracted from the table.

The difference between real and nominal GDP growth is reflected in the Implicit Price Deflator for gross domestic product, a measure of inflation that is distinct from more commonly reported quantities such as the monthly increase in CPI (consumer price index), or the quarterly increase in the price index for personal consumption expenditures (PCE deflator). The evolution of the GDP deflator can be seen at https://research.stlouisfed.org/fred2/series/A191RI1Q225SBEA.

We will round the growth rate to the nearest 0.1% for resolution.

Note that the growth rates will reflect the **most recent **estimate for Q2 GDP, versus the **advance estimate** for Q3 GDP.

## Discussion

Sort by:Date## BeteNoire • Tue Sep 29 2015 at 06:14am PDT

Real growth has averaged about 2% since the begining of the recovery. I am interested in the reasoning of those who expect growth below that.

## sflicht • Tue Sep 29 2015 at 06:42am PDT

The Atlanta Fed currently expects 1.8%. https://www.frbatlanta.org/cqer/research/gdpnow.aspx?panel=1

When I started this question, I initialized it at their forecast on that date , which was about 1%. This market has been slow to respond to updates in their forecasts.

## BeteNoire • Wed Sep 23 2015 at 02:47pm PDT

You are using the Advance Estimate, correct?

## sflicht • Wed Sep 23 2015 at 02:59pm PDT

correct. Although note that what they actually estimate is GDP not GDP growth rates. The advance estimate of GDP growth is computed from the advance estimate for Q3 GDP compared to the

revisedestimate for Q2 GDP.## benthinkin (ADMIN) • Tue Aug 18 2015 at 07:34am PDT

@sflicht apologies for the delays in publication—I’ve decreased the scale factor by an order of magnitude. We may want to run a parallel market with buckets.

## sflicht • Tue Aug 25 2015 at 02:26pm PDT

I created bucketed versions at https://home.inklingmarkets.com/markets/65499 and https://home.inklingmarkets.com/markets/65500. I’ll be curious to see which are more liquid.