How Misleading Economic Data Increase Investor Risks


Most investors heaved a sigh of relief when the nation's gross domestic product, a broad measure of economic activity, rose 3.5% in the third quarter, signaling that the recession had ended. But the Bureau of Labor Statistics (BLS) later revised it downward to 2.8%, and on Dec. 22, GDP was lowered again -- to 2.2%.

This 37% reduction in GDP certainly calls the entire data collection process -- and the value of these "headline" numbers -- into question.

Originally published