The economic backdrop today: Employment is strong Employment drives personal consumption Initial Unemployment claims dropped by 18,000 to 202,000. This is the 4th lowest number of initial unemployment claims of the year. Continuing claims dropped as well and the slope of the 4-week moving average is now negative indicating an incrementally easier environment to find a new job. Today's ADP [...]
The labor market is softening, but still strong. Disclaimer: This information is presented for informational purposes only and does not constitute an offer to sell, or the solicitation of an offer to buy any investment products. None of the information herein constitutes an investment recommendation, investment advice or an investment outlook. The opinions and conclusions contained in this report [...]
Manufacturing regionally, nationally and globally continues to be in contraction. In line with that theme, ISM reported 47.4% this morning, the 14th straight month of contraction. Manufacturing is contracting at slower rates and export orders continue to show improvement. To date this has played out more like a slowly recovering covid hangover. The fear is weak demand signaling recession, but [...]
Case Shiller Home Price Index The annual price change for houses from Oct 2022 to Oct 2023 is 4.8%. Though the monthly price increases are slowing, the annual inflation rate will continue to rise because of the disinflation at the end of 2022. The max benefit of falling prices was Jan 2023, so expect the annual inflation rate for house [...]
Residential construction continues to strengthen as non-residential construction may have peaked. The non-residential spending is a result of the public sector which contracted in November after a huge run for the last 18 months. Disclaimer: This information is presented for informational purposes only and does not constitute an offer to sell, or the solicitation of an offer to buy any [...]
Orders and output falling and now labor... “The slowdown is spreading to the labor market. Payrolls were cut for a third month running as increasing numbers of firms grew concerned about the development of excess operating capacity. The fourth quarter has consequently seen factories reduce employment at a pace not seen since 2009 barring only the early pandemic lockdown months."-- [...]
The headline number will be choppy for a few months because of dynamics from the end of 2022 and beginning of 2023. Core capital goods will be the series providing the most information for the time being. It bounced off 0% growth and is back closer to 2%, which is welcome news. Disclaimer: This information is presented for informational [...]
What's more pertinent? The index jumped 14% this month. The index has been in an uptrend for the last 18 months. The index is still weak relative to the last decade. Disclaimer: This information is presented for informational purposes only and does not constitute an offer to sell, or the solicitation of an offer to buy any investment products. None [...]
Outside of the pandemic defined as 2020 and 2021, this past quarter was the 5th best quarter for nominal GDP in the last 25 years. It was the best real growth quarter since Q2 and Q3 of 2014. The last 12 months has been mostly about services, here are the biggest contributors to YoY GDP: Consumption of Services Consumption of [...]
Tis was a poor number. The headline dropped from -5.9 to -10.5. The more eye popping number was the Index for New Orders which dropped from 1.3 to -25.6. I hate to say it, the diffusion index for new orders has never gone below 21 without an accompanying recession; that is until 2023. This is the 4th reading in the [...]
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