With seven of the nineteen indicators I expect to see reported this month out, the diffusion index of good news is at 42.9 for July. While this is below the final for June, it is ahead of the pace set in the early third of that month.
The Nation's international deficit in goods and services decreased to $26.0 billion in May from $28.8 billion in April, as exports increased and imports decreased. (A classic good, from the producers’ side.)
The U.S. Import Price Index rose 3.2 percent in June led by higher petroleum prices. The June increase followed a 1.4 percent advance in May. Export Prices also increased in June, rising 1.1 percent after advancing 0.5 percent in the previous month. (While firm pricing is nice for some at this economic juncture, these price rises are just too big. Bad news.)
Friday, July 10, 2009
Thursday, July 9, 2009
Keeping up the (slowly improving) pace
Mixed bag over the past couple of days. By the end of the week, it will be a useful exercise to calculate the good news index (GNI). As of today, only five of the more than 20 reports have been released. At this point, we’re keeping pace with last month.
Consumer credit decreased at an annual rate of 1-1/2 percent in May 2009. Revolving credit decreased at an annual rate of 3-3/4 percent, and nonrevolving credit decreased at an annual rate of 1/4 percent. (Still bad. Consumers still retrenching.)
May 2009 sales of merchant wholesalers were $311.3 billion, up 0.2 percent from last month. End-of-month inventories were $402.2 billion, down 0.8 percent. (Good. Both sides contribute to continued decline in the inventory-to-sales ratio.)
Consumer credit decreased at an annual rate of 1-1/2 percent in May 2009. Revolving credit decreased at an annual rate of 3-3/4 percent, and nonrevolving credit decreased at an annual rate of 1/4 percent. (Still bad. Consumers still retrenching.)
May 2009 sales of merchant wholesalers were $311.3 billion, up 0.2 percent from last month. End-of-month inventories were $402.2 billion, down 0.8 percent. (Good. Both sides contribute to continued decline in the inventory-to-sales ratio.)
Thursday, July 2, 2009
More red glare than early light
July sputters off to a weaker start than did June, but hey, there’s a holiday and a chance to rest, relax, and regroup before next Wednesday’s report on consumer credit. Have a great Fourth, but don’t propose any victory toasts quite yet.
Total construction activity for May 2009 was 0.9 percent below April 2009. This broke a very modest winning streak for this indicator. (Bad news. I’m still intrigued though by the strength in the construction of manufacturing facilities.)
New orders for manufactured goods in May increased $4.1 billion or 1.2 percent to $347.9 billion. (Good news—and the reason I’m intrigued by the factory-building boomlet.)
Nonfarm payroll employment continued to decline in June, falling by 467,000, and the unemployment rate was little changed at 9.5 percent. (Obviously bad, especially as the unemployment rate was “little changed” from 9.4 percent.)
Our proprietary index of labor market conditions dropped 2.2 percent in June. The gap between the index and its trailing six-month moving average edged down a bit, even so. As we noted recently, a trough in the index-moving-average gap has been associated quite closely with the trough in the business cycle.
Total construction activity for May 2009 was 0.9 percent below April 2009. This broke a very modest winning streak for this indicator. (Bad news. I’m still intrigued though by the strength in the construction of manufacturing facilities.)
New orders for manufactured goods in May increased $4.1 billion or 1.2 percent to $347.9 billion. (Good news—and the reason I’m intrigued by the factory-building boomlet.)
Nonfarm payroll employment continued to decline in June, falling by 467,000, and the unemployment rate was little changed at 9.5 percent. (Obviously bad, especially as the unemployment rate was “little changed” from 9.4 percent.)
Our proprietary index of labor market conditions dropped 2.2 percent in June. The gap between the index and its trailing six-month moving average edged down a bit, even so. As we noted recently, a trough in the index-moving-average gap has been associated quite closely with the trough in the business cycle.
Break out the near-beer!
As June came to a close, our index of good news diffusion flirted with and finally surpassed, however briefly, the 50 percent mark. For June’s releases, good news edged out the bad and the good news index (GNI) closed at 52.4. Celebrations were muted as analysts waited for at least another month’s worth of data.
After-tax profits for retailers averaged 1.7 cents per dollar of sales for the first quarter of 2009, up 2.0 cents from the after-tax losses average of 0.3 cents for the fourth quarter of 2008. (Profits are good, moving from losses to profits is good.)
New orders for manufactured durable goods increased 1.8 percent to $163.9 billion in May. (Good. Even better when three of the past four readings have been good; but still accompanied by declines in shipments, particularly in transportation equipment.)
Sales of new one-family houses in May 2009 were at a seasonally adjusted annual rate of 342,000, down 0.6 percent from April. (Bad. Housing-related sectors still struggle to build a foundation for growth.)
Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- decreased at an annual rate of 5.5 percent in the first quarter of 2009. (Bad, obviously, but less bad than both the last quarter of 2008 and earlier estimates of the first quarter of 2009.)
Personal income increased 1.4 percent and disposable personal income increased 1.6 percent in May. Personal consumption expenditures increased $25.1 billion, or 0.3 percent. (Good. We consumers are becoming less of an anchor.)
After-tax profits for retailers averaged 1.7 cents per dollar of sales for the first quarter of 2009, up 2.0 cents from the after-tax losses average of 0.3 cents for the fourth quarter of 2008. (Profits are good, moving from losses to profits is good.)
New orders for manufactured durable goods increased 1.8 percent to $163.9 billion in May. (Good. Even better when three of the past four readings have been good; but still accompanied by declines in shipments, particularly in transportation equipment.)
Sales of new one-family houses in May 2009 were at a seasonally adjusted annual rate of 342,000, down 0.6 percent from April. (Bad. Housing-related sectors still struggle to build a foundation for growth.)
Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- decreased at an annual rate of 5.5 percent in the first quarter of 2009. (Bad, obviously, but less bad than both the last quarter of 2008 and earlier estimates of the first quarter of 2009.)
Personal income increased 1.4 percent and disposable personal income increased 1.6 percent in May. Personal consumption expenditures increased $25.1 billion, or 0.3 percent. (Good. We consumers are becoming less of an anchor.)
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