If You Can’t Win, Change the Standards
In trying to sound modest and even magnanimous, Ben Bernanke in November 2010 penned an oped in the Washington Post justifying the recently implemented QE 2. Toward the end of his piece he acknowledged that the Federal Reserve and monetary policy could not work miracles. But given that obsequious qualification, the Fed Chairman was very .. read more
Stasis Is Not An Economic State
Economies either grow or they shrink, though shrinking is a misplaced word here. A real economic system is always moving forward, even during recession and dislocation. The word dislocation is used in modern economics where it probably does not belong, as well. The entire idea of a dislocation is antithetical to a real economy, being .. read more
Personal Income & Spending Align
Consumer confidence is at multi-year highs while personal income and wage levels for April were declining on a nominal basis. Without the boost of 0.2% “deflation”, disposable personal income actually declined 0.1% on a nominal basis. Personal spending fell 0.2% on a nominal basis. The internals of the nominal decline related to three separate items .. read more
Earnings Outside the Vacuum
Since it has been a slow week in terms of economic data, we can take some time to review corporate earnings season. The current estimate for Q1 2013 operating earnings on the S&P 500 (with 465 companies reporting so far) is for 6.2% Y/Y growth. That is up from -2.44% and -5.10% the previous two .. read more
Early Warnings In the Italian Loan Market
Banco Popolare, one of the 25 largest banks in Europe and one of Italy’s largest, was forced to inject “capital” into a subsidiary joint venture, Agos Ducato SpA. Losses have been mounting at Agos, a consumer lending conduit in Italy, for more than a year. The company is joint venture between Banco and French megabank, .. read more
Closer Look at Q1 GDP
Joe covered the GDP release for Q1 2013 earlier where he noted that: “While on the surface that seems better than the 4th quarter rate of 0.4%, the details were actually worse in many ways.” I wanted to follow up with one of those “worse” features – consumer spending on housing “services”. This is a .. read more
Whither Production
Before we get to durable goods, I last noted manufacturing data seemed to indicate that the mini-cycle related to inventory appeared to be a desperately short two month uptick. This restocking (if that was what took place) was seen in various surveys and releases, notably the ISM indices and factory orders. The latest data for .. 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
