Earnings And Sales Continue To Run Below Great Recession

Last week it was Target’s turn to turn in a disappointing quarterly report. While being quite unique in blaming Canada, even the results in the US segment were lackluster, at best. Earnings expectations for the fiscal year were dimmed back in May, from a range of $4.85 to $5.05 down to $4.70 to $4.90. The .. read more

Trend-Cycle Theory, Hiding In Revision

It is nearly impossible to spot recession and economic weakness in real time through economic accounts alone. Because of the way economic estimates are gathered and, more importantly, calculated, they will always be “behind the curve” of economic trends as they shift from one state to the next. In other words, the Bureau of Economic .. read more

Missing the Goods Economy Forest

Given the weak state of the economy and its relation to so much monetary “stimulus”, it is still amazing that the standards for positive economic performance or momentum have been so drastically reduced. The durable goods report is a perfect example. There is no doubt that some manufacturing activity has ticked up after the disastrous .. read more

Volatility Can Be The Expiration of Reflation

While our focus is usually trained on markets, volatility as a concept can apply to much more than asset inflation extremities. The Japanese bond and stock markets are conforming to the QE script, as US markets begin to correlate (across the JPY-USD). What’s really interesting, however, is that despite now four years into a “recovery” .. read more

Where’s the Butterfly?

A healthy caterpillar will always turn into a butterfly, a beautiful, stunning representation of a natural system in good balance with sustainable proportions. Likewise, a healthy Caterpillar is a sign of a stable and healthy economic system, whether defined by region or the entire globe. If we look at Caterpillar’s dealer sales figures, it gives .. read more

Exploring the Limits of Monetary Intervention

The mini-cycle in inventory has re-appeared in the latest two regional manufacturing surveys. Both the Empire Fed and Philly Fed indices have again fallen below zero, indicating a contraction in activity. However, it is the frequency of negative readings that is most relevant. Since the middle of 2012, both surveys (along with their three other .. read more

The Proper Perspective on Jobs and Income

The headline employment growth for May 1974 totaled 165,000 jobs. That followed a weaker report from April where only 89,000 new jobs were created. Only a few months before, the headline beancount of job quantity was 304,000. For the seven months between November 1973 and May 1974, the headline averaged +135,000. That was notable because .. read more

Retail Sales Slowing In Every Segment

This morning’s retail sales figure from the Census Bureau shows a Y/Y increase (unadjusted) of only 1.79%. That is the second worst month since the recovery took hold in later 2009. The worst month was actually last month, which means the current condition in retail trade is, by far, the worst two months since the .. read more