Industrial production fell year-over-year in May 2016 for the ninth consecutive month. At -1.4%, it is the same kind of slow, steady contraction now that we find in so many other places. This is not the typical recession response, instead more consistent with the slowdown turning into serious than just insufficient growth while still at the precipice of potential recession. [...]
Inventory is an exceedingly simple concept spaced between the most basic economic fundamentals. Because the modern economy operates upon mass production, the flow of goods is not direct. Thus, there are structural differences between demand and supply, with inventory as the pivot in between. If end demand rises it still gets filled even though production cannot respond instantaneously (no matter [...]
Walter W. Heller was said to have been an “educator of Presidents.” As an economist and Presidential advisor in the inner circles of DC, Heller worked with more candidates and officeholders than perhaps any other man. As he himself described, his influence went all the way back to Adlai Stevenson and kept on through Kennedy, Johnson, Carter, and Mondale. To [...]
As with other economic accounts, retail sales dropped back in May after the temporary rebound coincident to calendar effects. Overall sales, including autos, grew just 1.9% over May 2015, well below the 3% level that historically defines recessionary conditions. That growth rate was the 39th worst in the entire data series (out of 281 months), placing it in the lower [...]
If there seems to be more safe haven demand of late, the increasing odds of British exit from the EU is being blamed. According to Yahoo!Finance, Goldman Sachs sees “kinks” in the option structure, an agglomeration of hedging demand that points to maturities around the UK referendum. The absence of any heavy hedging this week suggests that markets have no [...]
As always, there is the attempt to put a brave face on what is shaping up to be the worst year yet. China’s “big 3” economic data were all disappointing in the context of what the last “brave face” was supposed to suggest – where weakness at the start of the year was only due to “global turmoil” and would [...]
With stocks down for a second day, attention has been focused on the UK vote potentially in favor of leaving the EU. It seems like a naturally disruptive event, or at least in theory, an outcome that the mainstream globalist persuasion continues to emphasize. That is certainly one possible explanation, but a more likely scenario is one where CNY plays [...]
In August 2013, the Treasury Department through its Treasury International Capital data (TIC) put a scale on that summer’s disruption. With a two month delay, the TIC figures gave us some insight as to why the fixed income/MBS selloff that summer was so violent; and further why it had so easily spread to currency markets. The destabilization of that event [...]
Economic Reports Scorecard Concern about recession is growing again as formerly strong portions of the economy turn down. The last two weeks brought reports of new weakness in the labor market, continued slowing in construction and renewed weakness in manufacturing. Auto sales were also weak based on the reports from individual manufacturers. The state of auto sales is frankly a [...]
On July 2, 2015, the 10-year Japanese Government Bond (JGB) traded to a stout closing yield of 0.511%. That was up significantly, in Japanese financial terms, from the start to the year where the benchmark bond yield had tumbled to as low as 0.206% supposedly in the aftermath of QQE expansion. The Bank of Japan had added to its already-disgusting [...]
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