The problem with the employment report is not just about how it is calculated but more so that it is taken as the definitive measure of economic performance. The notion itself, conceptually at least, isn’t assaultive as the modern economy is entirely about the division of labor and specialization, so anything that deals in that subject matter is already in [...]
Recognizing the danger of relying too much on a PMI, the official version of the Chinese PMI not only disappointed absent any detectable rebound it also contained at least a superficial indication that the US isn’t experiencing one either. Overall, the PMI stayed right at 50, for whatever that might be worth, but several key subcomponents moved deeper below that [...]
It is hard to take any one-month change as anything more than usual variation when it is so far out of alignment with everything else. Some economists are cheering the fact that retail sales rose for the first time in four months, and that it was the biggest monthly gain in a year, but both of those interpretations obscure that [...]
The wholesale sales and inventory figures were significantly revised this month going back more than a decade. The largest revisions were evident after 2007, which changes slightly the depth of the Great Recession and the “briskness” of the stunted recovery thereafter. Though both sales and inventory figures are much higher than previously believed (until they get revised again), the economic [...]
To add depth to the consumer credit version of consumer inclinations in 2015, Gallup’s estimates of daily spending in March came in at $86. That was only $4 greater than February’s $82 which hadn’t rebounded at all from January. In other words, there is “something” wrong with consumers so far in 2015, even as compared to prior years of lethargy. [...]
The frightening possibility that the US economy, and the world with it, remains still bound by a single “cycle” dating back to at least 2007 (and you could even argue 2000 or 1995) brings with it nothing good about future prospects. If 2009 wasn’t really the ultimate end then that would mean the true trough is still to be found. [...]
One of the primary pillars of even the tepid “recovery” of this cycle is undoubtedly auto sales. We can have a debate as to the influence of monetary policy in this arena, especially as auto loans have (along with student loans) been practically the only direct conduit of credit into the real economy. Clearly, despite the heavy flow there, auto [...]
The world of orthodox economics is populated by generic assumptions. The biggest and most dangerous is that of “aggregate demand” which posits that any economic activity is perfectly substituted for any other economic activity. Since there is no distinction among “what” is taking place and more importantly “why”, that has led economic policy and especially monetary policy toward command management. [...]
Yesterday in trying describe Janet Yellen’s testimony to Congress about the economy, pundits apparently were forced to concede that the “data won’t cooperate”, thus leaving the economy in Yellen’s head to be wholly different than anything described elsewhere outside the media echoes. Today’s release of durable goods provides yet another data point that “will not cooperate” with the dreamland of [...]
The pace of new home sales continues to be stuck right below that 500k SAAR, a flattening of activity that dates back really to January 2013. The data has at times peaked above 500k only to be revised subsequently lower, which does not provide a whole lot of confidence about recent months. January’s level was slightly below December, but volatility [...]
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