Thread: Need to put together a new index

Marginal consumption is increasingly driven by wealth effects i.e. real estate and stock portfolios, precious metal hoard market values and durable goods or capital equipment valuations drive discretionary expenditures. Credit card, mortgage, margin and bond interest rates tend to rein such expenditures in.
Wage income is declining as an economic driver.

So GDP, a measure of income, is decreasing in importance as the capitalization of expenditure, at say the Bush ranch, increasingly substitutes for monthly bills. Is it not time to also keep track of the National portfolio so DC can begin to move into at least the 20th century if not the 21st?

GDP was never a measure of income. GDP is a measure of production, as evidenced by the final price of all goods and services purchased throughout the year. If the savings rate is negative, GDP is in fact higher than aggregate income.

In other words if there is a net trade deficit that exceeds dissavings GDP is less than national income. Also I was double-checking, gross domestic product is almost always less than total domestic income flows in any case because it does not count profits on the sale of previously produced items such as existing buildings, capital equipment and durable goods such as cars. by the way you failed to address the question.