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Roubini:

The official headline for U.S. Q1 GDP growth says a positive 0.6% growth but the details are ugly and confirm that we are in a recession.

First of all, if you exclude the increase of inventory of unsold goods (that moved positive after a negative figure in Q4) the Final Sales of Domestic Product were a negative 0.2%. In other terms, inventories of unsold goods added an artificial 0.8% to Q1 growth boosting it from a negative 0.2% to a positive 0.6%. So actual aggregate demand (Final Sales of Domestic Product) - the actual measure of growth of true demand - fell in Q1. And this build-up of inventories in Q1 means that the fall in GDP in Q2 will be larger than otherwise as firms will have to reduce that large inventory of unsold goods via a further reduction in production and employment.

Second, residential investment is in total free fall, collapsing at an accelerating annual rate of 26.7%. But GDP figures underestimate the true fall in aggregate demand as they do not separate residential investment into true final sales of new homes and into the unsold inventory of new homes that are produced and not sold. Thus, all production of new homes is assumed to be sold in the national income accounts data. But we know that home sales are falling more than production of new homes, that cancellation rates (running at a rate of 20-30%) are not included in the new home sales figures and that the inventory of unsold new homes is actually rising. Thus, if the BEA had correctly measured final sales of domestic product, by having a separate line for the change in the inventories of new unsold homes (the equivalent of the change in business inventories), the figure for final sales of domestic product would have been even more negative than the already negative 0.2%, probably a negative 1.0%. So the national accounts make a methodological mistake in measuring final sales of domestic product by assuming that the change in inventories of unsold housing is always zero, something that is obviously wrong especially during a severe housing recession.

UPDATE: Meanwhile.... For Exxon Mobil, $10.9 Billion Profit Disappoints. It must be so hard to be Exxon Mobil....