Jake's View | Why our GDP data can’t be trusted
Official growth and inflation figures are a mixture of guesswork and flawed accounting
Quarterly performance figures released on Friday showed the economy grew 0.8 per cent in the first three months, its slowest quarterly growth in four years ... The figure was down from the 1.93 per cent growth recorded in the previous quarter.
SCMP, May 16
Let me describe for you the exactitude of measurements of the growth of gross domestic product. They are like driving one of those old manual shift cars with three gears. Your have three forward speeds – zero to four per cent, four to eight per cent, and probable nonsense.
And don’t even try to put a number on it when you’re in reverse.
They are called national accounts, which may give you the impression that they are similar to audited corporate accounts. In fact, they comprise nowhere near as full a statement, or as precise.
Where a public company gives you a profit and loss account, a balance sheet, a cash flow statement and detailed notes to the accounts, these national accounts give you only a summary of the application of funds, which is the equivalent of one half of a corporate cash flow statement.