New orders, shipments, and unfilled orders for manufactured durable goods all declined in December. Inventories rose over the month. The decline in shipments was 0.7 percent while the unfilled orders book shrank 1.3 percent. Taken together, these data imply that the cushion of unfilled orders is being eroded.
Sales of new one-family houses in December 2008 were at a seasonally adjusted annual rate of 331,000. This is 14.7 percent below November and 44.8 percent below December 2007.
Both of these reports are pretty unambiguously bad news. The decline in new orders was fractionally less severe than last month, but even Pollyanna couldn’t make lemonade out of that.
The diffusion of good news in January’s statistical releases now stands at 14.7 percent. There are two releases to go—GDP (Q4) and ECI (Dec)—so I can’t see this rising much. Even if both max out, less than a quarter of the news we have seen this month would have been negative.
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