When real household spending fell by 4.6% in April 2014 it was cause for concern. That was the first month after the tax hike hit and the decline in spending was much larger than anticipated (by economists, at least). Despite the heavy toll, Bank of Japan officials remained (outwardly) wholly unconcerned over what was believed a minor setback on the [...]
Despite the disappointing headline Establishment Survey estimate, those inclined to believe the payroll report as an overall economic narrative had two fallback issues. U.S. employment gains slowed more than expected in January as the boost to hiring from unseasonably mild weather faded, but surging wages and an unemployment rate at an eight-year low suggested the labor market recovery remains firm. [...]
The headline Establishment Survey number disappointed at just 151k in January. The figure does not represent the actual amount of jobs gained, of course, since employment in January is typically about 3 million less than December. What that estimate represents is a combination of imputations about seasonality (comparing the actual change in the data set to the “typical” decline December [...]
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 [...]
I think it entirely fitting, even useful in the long run, that December’s payroll report was yet another perfect month; the fourth of 2015 by my unofficial count. There was absolutely nothing wrong with any of the components, at least in the raw job count estimated by various statistical regressions and adjusted with imputations (wages, not so much). The problem [...]
Spending and wage growth disappointed in September, particularly as incomes continue to register barely any growth. The fact that this stagnation has continued for several years allows commentary such as this: U.S. consumer spending in September recorded its smallest gain in eight months as income barely rose, suggesting some cooling in domestic demand after recent hefty increases. The Commerce [...]
If central banks are now almost exclusively on the defensive, we have no shortage of anecdotes and data to explain it. For a good long while economists and commentary managed to keep the US safely “decoupled” from the “overseas” maelstrom, but the deluge locally has become far too much to ignore. This is far, far deeper than just some indistinct [...]
The problem with using GDP as the primary means of economic accounting is its very nature. By attempting both comprehensiveness and precision, the resulting calculation is an agglomeration of various methods and sources, many of which are quite dynamic apart from static regressions. By that construction alone, GDP is susceptible to high degrees of kurtosis where assumptions find little. In [...]
Durable goods continue to contract, with August down year-over-year in both shipments and orders now. New orders have been contracting since February (with January barely positive) at an almost steady rate near -3% the last few months, while shipments did not see a negative rate until May (and were slightly positive again in June). In capital goods, the pattern is [...]
With back-to-school shopping falling apart, the focus turns quickly to the Christmas season once more. That is fully expected, lest anyone dwell too long on the August spending figures and begin to see through the “strong” economy. August retail sales – as expected – showed the effects of slow mall traffic and comparisons with very strong August results a year [...]
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