First and foremost, Durable goods peaked in the short term in June. A repeated theme, we saw some strength in Sep, October is again weak, expect November to be better given a really bad Nov 22. Aircraft orders are significant. The $16B drop in Durable Goods Orders is from a drop in non defense aircraft orders. The following 2 graphs [...]
This was a slight downward revision. Nothing to cheer and really nothing to write home about. September Durable Goods were revised down .1% MoM in Sept and .05% MoM in Aug. Here's a picture of Factory Orders. Looking at this time series, it's almost as if the recession that has been 2 years in the waiting was merely coming off [...]
Factory Orders continues to slow after pandemic surge. Questions to ask: Is the slowing just reversion after a pandemic surge because of supply chain disruptions, onshoring, low interest rate, stimulus? Thus, will this be the soft landing everyone is hoping for? Does it matter as slowing activity is slowing activity and activity continues to slow? No one knows the answer [...]
How odd is this economy? Two economic reports from last week, attempting to measure essentially the same thing, reported results that were so different they could be about two different countries. At 9:45 Wednesday morning, S&P Global reported their US Services PMI for July as 47.3 versus June's 52.7, a sudden and large one-month drop. When they reported the preliminary [...]
As it now stands, the World Bank isn’t currently forecasting recession sweeping across the globe. Instead, the organization is merely warning this is a growing possibility. Econometric models abhor making big changes to projections within small timeframes, yet the regressions employed here couldn’t be helped this time.Back in January, at the last issue of the World Bank’s Global Economic Prospects, [...]
As a preface to this update ostensibly on Europe, it’s all really about Euro$ #5 sadly rounding into form. In this first part, I’m going to have resurrect the quotation marks surrounding the term “rate hikes”, or bring back RHINO (rate hikes in name only) given what’s going on in Treasury bills.Not rate hikes, or enough of them. Our dead [...]
The price illusion. It is causing enormous confusion and difficulty, making the global economy out to be something it really isn’t. In fact, the whole situation is being viewed backward. What’s presumed from this is a red-hot economy causing consumer prices to skyrocket. In such a scenario, central banks might need to rush their rate hikes to cool it down [...]
US factories are humming along, constrained only by supply issues which might occasionally limit production. That’s the story, anyway. There’s too much business because of them, manufacturers taking in only more orders by the day leaving them struggling to catch up.But what kind of stuff is it that is being ordered from our nation’s factories?Without thinking too much about it, [...]
Trading partners like Mexico didn’t have a labor participation problem by which to hide the economic downturn last year. The whole idea of “decoupling” in the 2018 sense of the word was how the US economy, by virtue of its 50-year low unemployment rate, couldn’t possibly be as weak as it increasingly appeared overseas. The US was good, they kept [...]
What relaunched Europe’s QE four months ago was the word “protracted.” Central bankers love its opposite, the term “transitory”, which they use quite often at every sign of a weakening economy. To be fair, economies ebb and flow all the time and we don’t want policymakers to jump at every minor swing one way or another. The problem, it seems, [...]
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