It wasn’t in any way magnanimous for the FOMC to state clearly what everyone already knew without any need for aid of GDP calculations. The policy statement for its January 2016 meeting included language that mitigated, if not fully than significantly, the continued reliance on labor indications alone. The Fed says the labor market continues to point in the right [...]
Durable goods orders and shipments declined much worse in December than November, ending any hope that November’s variation was anything other than simply that. Across-the-board, capital goods as well as durable goods, the numbers year-over-year were nearly flat for November, thus suggesting just how bad 2015 was overall when slightly negative seems like a huge improvement. So where capital goods [...]
If the Wall Street Journal meant to reach for reassuring comfort, they fell far short. After spending late summer last year and into the fall proclaiming that manufacturing didn’t matter (12%), the newest round of talking points are “false positives.” In other words, manufacturing and industry does matter, after all, but just “not enough” to tip into full recession. That [...]
Despite continued cuts in production and supply chain activity, inventory through November persists in great imbalance. With December retail sales demonstrating a Christmas sales season only worse in 2008 and 2009, that isn’t like to have changed. It’s not as if manufacturers and imports have been robust to build that much inventory; production is already in clear recession. The only [...]
One follow up point to this morning’s missive about why the economy seems to be converging in recession rather than full and blossoming recovery: There must be something said about the manner of redistribution in this “cycle” as different from all others. In other words, the Fed has been attempting greater and greater redistribution efforts via monetary interference ever since [...]
For something that central bankers and economists were so sure wasn’t ever going to be troubling, oil seems to have become something of a communicable financial disease at the outset of 2016. If 2015 was somewhat sour and disappointing, 2016 was supposed to leave no doubt; it is, just not in the manner predicted. This morning’s headlines tell you all [...]
If top level sales are not to ever become what economists projected, as retail sales left little doubt in December, then what is left is to no longer hold the line as best as possible on resources and inputs. With inventory already massive, production must be brought down to equalize sales at each level plus already accumulated(ing) inventory. With the [...]
The scale of the inventory bloat in the latter half of 2015 was perplexing. By any reasonable standard, it doesn’t make any sense that businesses would be so bold as to almost ignore sales (and this applies at each level of the supply chain). The only way that it could have possibly occurred was businesses setting aside what was happening [...]
The US economy is supposed to be nothing like its Chinese counterpart, a sentiment that extends in the mainstream well past that into genuine surprise about how it would be possible US financial markets tripping over Chinese stumbles. Though the US might be fighting, too, a manufacturing slump that looks more like recession every day, convention still holds that the [...]
The fallout in liquidity and funding markets (subscription required) has been mostly suggested at the junk bond bubble. Prices have fallen, and many precipitously, while yields have risen. But those are not the only negative factors being exhibited. If the issuance figures are anywhere close to correct, then increasingly junk obligors are being totally shut out at any price. Worse [...]
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