201711.22
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Durable Goods Only About Halfway To Real Reflation

Durable goods were boosted for a second month by the after-effects of Harvey and Irma. New orders excluding those from transportation industries rose 8.5% year-over-year in October 2017, a slight acceleration from the 6.5% average of the four previous months. Shipments of durable goods (ex transportation) also rose by 8% last month. Even with that…

201711.15
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Can’t Hide From The CPI

On the vital matter of missing symmetry, consumer price indices across the world keep suggesting there remains none. Recoveries were called “V” shaped for a reason. Any economy knocked down would be as intense in getting back up, normal cyclical forces creating momentum for that to (only) happen. In the context of the past three…

201711.15
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Symmetry Matters, Or The (Small) Progress of Stating The Obvious

Chicago Fed President Charles Evans is this year a voting FOMC member. Normally, that might not make much difference but in times like this where dissension is building beneath the surface of even the typically stoic central bank, this time it might. Apparently we can count Evans among the list dissatisfied with the current state…

201711.09
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The Inflation of China’s Condition

One day after the China’s government reported disappointing but consistent trade figures, that country’s National Bureau of Statistics published inflation estimates that are being branded at least on this side of the Pacific as some degree of “hot.” As is usually the case, the characterization is wildly off. China is no closer now to an…

201711.07
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Everything Now On Slack

The whole thing really does unravel at the unemployment rate. If it indicates the correct view of the economy, even close to “full employment”, then what follows is fairly typical and orthodox stuff. In the context of what the Fed is doing, short-term rate hikes are leading the longer end of the yield curve toward…

201711.06 5

Europe Is Booming, Except It’s Not

European GDP rose 0.6% quarter-over-quarter in Q3 2017, the eighteenth consecutive increase for the Continental (EA 19) economy. That latter result is being heralded as some sort of achievement, though the 0.6% is also to a lesser degree. The truth is that neither is meaningful, and that Europe’s economy continues toward instead the abyss. At…

201711.06
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Aligning Politics To economics

There is no argument that the New Deal of the 1930’s completely changed the political situation in America, including the fundamental relationship of the government to its people. The way it came about was entirely familiar, a sense from among a large (enough) portion of the general population that the paradigm of the time no…

201711.03
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Ahead, Not Behind

Back in September, the FOMC announced that it was in October going to start normalizing its balance sheet. The policy statement issued that day included all the usual qualifications of “solid”, “strengthen”, and “picked up.” The near-term risks to the economy, it was written, “appear roughly balanced.” Not all was well with the economic situation,…

201711.03
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Four Point One

The payroll report for October 2017 was still affected by the summer storms in Texas and Florida. That was expected. The Establishment Survey estimates for August and September were revised higher, the latter from a -33k to +18k. Most economists were expecting a huge gain in October to snapback from that hurricane number, but the…

201710.23
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Bi-Weekly Economic Review: Yawn

When I wrote the update two weeks ago I said that we might be nearing the point of maximum optimism. Apparently, there is another gear for optimism in this market as stocks have just continued to slowly but surely reach for the sky. Which is fine I suppose since we own the devils (although not…