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6/1/21: BRIC: Composite Economic Indicators: 4Q 2020

18 days ago

Manufacturing PMIs for BRIC economies for 4Q 2020 are discussed here: https://trueeconomics.blogspot.com/2021/01/4121-bric-manufacturing-pmis-4q-2020.html.Services PMIs are covered here: https://trueeconomics.blogspot.com/2021/01/6121-bric-services-pmis-4q-2020.html.Now, Composite PMIs:Brazil Composite PMI rose from 51.6 in 3Q 2020 to 54.4 in 4Q 2020, marking second consecutive quarter of > 50.0 readings. Average 4 quarters PMI stands at 46.2, suggesting that Brazil’s economy has not, yet, recovered fully from the Covid19 pandemic impact. Nonetheless, statistically, both 3Q and 4Q readings are signaling economic expansion and 4Q growth in Brazil’s economy appears to be faster-paced than global (global composite PMI was at 53.3 in 4Q 2020).Russia Composite PMI is in a contraction

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6/1/21: BRIC: Services PMIs: 4Q 2020

18 days ago

BRIC’s manufacturing PMIs for 4Q 2020 were covered here: https://trueeconomics.blogspot.com/2021/01/4121-bric-manufacturing-pmis-4q-2020.html. Now, to Services PMIs:Brazil Services PMI rose from 47.5 in 3Q 2020 to 51.4 in 4Q 2020, with aggregate 2020 levels of activity still significantly below 2019 levels. At 51.4, the index is barely statistically above 50.0 (95% confidence bound is 51.3). However, the latest quarterly reading is the first nominally above 50.0 after three consecutive quarters of sub-50 readings. Russia Services PMI crashed in 4Q 2020 from 56.8 in 3Q to 47.7. Statistically, Russian services sector is contracting and it is contracting rapidly. In the entire 2020, there were three quarters of deeply sub-50 readings against one quarter of above 50.0 expansion. Services

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5/1/21: Ireland PMIs: 4Q 2020

19 days ago

Ireland’s economic activity improved significantly in December, and the improvements were marked across all three sectors:Ireland’s Manufacturing PMI rose 52.2 in November to 57.2 in December, marking the third consecutive month of > 50 readings, the second consecutive month of indicator being statistically above 50.0 line. The last three months average (53.23) is on 2Q 2020 average (53.30) and this is pretty encouraging, given the weakness in the indicator over 1H 2020. Ireland’s Services PMI also rose in December, reaching 50.1 from recessionary 45.4 in November. 4Q average is still weak at 47.9 (contractionary) after being effectively stagnant at 50.03 over 3Q 2020. Monthly increase in December, however, is a brighter spot.Ireland’s Construction sector PMI (data through mid-December)

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5/1/21: U.S. Labor Markets Update: America’s Scariest Charts

19 days ago

Continued unemployment claims (based on seasonally-adjusted data) are continuing to decline, as the latest data through mid-December 2020 shows, yet, even with these news, the latest data print puts continued claims for unemployment at the levels comparable with late 2009. So here is the chart showing overall levels of continued unemployment claims in the U.S.:And here is one of my "Scariest Charts", showing index of continued unemployment claims across all modern recessions:Given current rates of continued unemployment claims declines, Over the last 4 weeks, average weekly decrease in continued unemployment claims stood at 77,000Current levels are 3,570,000 higher than pre-Covid low.Which means that it would take roughly 46 weeks at the current 4-weeks average rate of decrease to

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4/1/21: BRIC: Manufacturing PMIs 4Q 2020

20 days ago

Latest data for BRIC Manufacturing PMIs indicates three countries outperforming global rate of recovery in manufacturing sector, against one country (Russia) remaining in contraction territory and well below global growth mark.On a quarterly basis,Brazil’s Manufacturing PMI stood at 64.1 in 4Q 2020, up on 62.6 in 3Q 2020, marking the second highest and the highest reading on record. The contraction in 2Q 2020 (with PMI at 42.0) was sharp, but not as sharp as in 1Q 2009. By these comparatives, GFC-related contraction of 2008-2009 resulted in 4 quarters average reading of 45.1 and saw three consecutive sub-50 readings. The Covid-19 related contraction was stretched only across one quarter, with 4 quarters average of 54.8 in 2020. It is, genuinely, hard to reconcile these numbers with

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3/1/21: Covid19 update: Sweden vs Nordics

21 days ago

As before, let’s conclude the latest update of the Covid19 trends data with analysis covering comparatives between Sweden and other Nordics. Sweden is commonly used as a shining example of ‘saving the economy’ by not ‘panicking’ into severe mobility restrictions. This argument is commonly used by the folks who tend to believe in sinister Big State conspiracies around other countries’ responses to the pandemic.Sweden started the pandemic by openly pursuing the strategy targeting ‘herd immunity’. In this, the country approach to the pandemic containment was similar to that of the Netherlands. However, unlike Sweden, the Netherlands quickly reversed this approach and switched to the more common policy response of imposing severe mobility restrictions.When it comes to the Nordic countries,

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2/1/21: Covid19 update: U.S. vs EU27

22 days ago

In previous posts, I covered Covid-19 updates for the last week of 2020 for:Worldwide trends: https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-worldwide-numbers.html;Europe and the EU27: https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-europe.html; Countries with more than 250,000 cases: https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-countries-with-250k.html; andBRIICS: https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-briics.html.In this post, let’s take a look at the latest data for the U.S. compared to the EU27.Weekly counts of new cases and deaths, illustrated above, suggest that:Since the start of the pandemic, the U.S. has experienced three waves, against the EU27’s two of the pandemic. The EU27’s 2nd wave appears to have

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2/1/21: Covid19 update: BRIICS

22 days ago

In previous posts, I covered Covid-19 updates for the last week of 2020 for:Worldwide trends: https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-worldwide-numbers.html;Europe and the EU27: https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-europe.html; andCountries with more than 250,000 cases: https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-countries-with-250k.html.Cumulative data for BRIICS (Brazil, Russia, India, Indonesia, China and South Africa) shows continued steady expansion of the pandemic in total cases and deaths:Currently, BRIICS account for 28.2% of all cases of Covid-19 in the world, and 25.3% of all deaths. This compares to these countries accounting for 45.3% of the world population.The pandemic has been relatively benign for this

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2/1/21: Covid19 update: Countries with > 250K cases

22 days ago

In previous posts, I covered worldwide trends for Covid19 pandemic evolution (https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-worldwide-numbers.html) and pandemic developments in Europe and the EU27 (https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-europe.html). Here, let’s take a look at the set of countries with more than 250,000 confirmed cases.As of week 52 of 2020, there were 40 countries in this group, accounting for 90 percent of the world total number of cases, 92 percent of the global deaths and 64 percent of the world’s population. Tables below provide summary statistics for these countries:You can click on the charts to magnify them.The same data reported by regions and continents:And a table of summary statistics:Some noteworthy observations from

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2/1/21: Covid19 update: Europe

22 days ago

Introducing new analysis for Europe and EU27 across the main metrics of the pandemic (see data note and coverage of worldwide trends here: https://trueeconomics.blogspot.com/2021/01/2121-covid19-update-worldwide-numbers.html). All data through week 52 of 2020.Europe is continuing to experience Wave 2 of the pandemic, while EU27 is on the abating part of the pandemic curve, albeit with some volatility to the upside, especially in weeks 49-51. The above data is yet to fully reflect the beginning of the new strand of the virus (commonly referenced to the UK as the country of origin, although this appears to be a questionable reference point).In terms of deaths, peak of the Wave 2 of the pandemic can now be timed to week 48, although in the last two weeks of 2020 there is some evidence

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2/1/21: Covid19 update: Worldwide numbers

22 days ago

Starting the new year of data analysis for Covid19 pandemic, I have re-configured the charts and my database to reflect changes in ECDC reporting from daily to weekly aggregates, as reported through Thursday each week. The result is smoother data series, allowing for clearer analysis of the key trends. The downside, of course, is the lags in data reporting.Please, note for the future: weekly data is subject to revisions by the ECDC.First post, Worldwide figures and trends.As of the last week of 2020, worldwide cases of positive tests have reached 80,177,400, with seventh consecutive week of above 4 million new cases reported on a weekly basis. The last week of the year data is subject to future revisions and reflects low accuracy of reporting due to holidays. Nonetheless, the pandemic

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15/12/20: Of herd immunity and vaccine coverage

December 15, 2020

Even with two vaccines now in the Emergency Authorization, we are many months away from reaching herd immunity levels, and worse, it is not entirely clear that we actually can reach that point at all. McKinsey research on Covid19 vaccines currently either authorized or close to authorization is dire (see https://www.mckinsey.com/industries/healthcare-systems-and-services/our-insights/when-will-the-covid-19-pandemic-end). In basic terms, accounting for current immunity levels (effectively – infections-induced immunity) and assumed vaccines 95% effectiveness rate, but varying the assumed durability of the immunity gained from the vaccines, the U.S. will require 58-85% rate of vaccinations to reach herd immunity frontier (minimum level of immunity). One of the drivers for such high threshold

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15/12/20: Impact of Covid19 on families & labor

December 15, 2020

Some interesting research on the less tangible differential impacts of Covid19 pandemic via McKinsey: families with children and families without childrenIn all categories, impact of the pandemic has been more severe on families with children. Predictably, as parents are facing increased demand on household work and higher pressure of increased density of living.Closure of schools or flex-model (partial closure) are probably one of the key drivers:Public safety during the pandemic might (rightly) be the overriding concern when it comes to designing strategic approach to managing the pandemic responses, but as the pandemic drags on, the above impacts are likely to cumulate. Something has to give. One example of appropriate response should be changing or suspending all traditional job

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10/12/20: U.S. Labor Markets Update: America’s Scariest Charts

December 10, 2020

Continued unemployment claims are running below the 2008 GFC peak for the third week in a row, but adjusting to pre-Covid19 cycle unemployment roughs, we are still ways to go:Despite making some serious inroads in reducing unemployment, U.S. labor markets are still half-alive and things are starting to look shaky:Latest weekly change in continued unemployment figures is an increase of 230,000 – the first rise in 13 weeks.Pre-Covid19 trough was at 1,702,000 continued claims. We are currently at 5,757,000.Compared to pre-recession 12 weeks low, current unemployment claims are 334% higher or more than 3.3 times higher.New claims are also rising: the latest confirmed data is a weekly increase of 23,977 – the largest in 5 weeks.The latest preliminary data shows new claims up +228,982 in the

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4/12/20: COVID19 Update: U.S. vs EU27

December 5, 2020

EU27 vs U.S. comparatives for COVID19 pandemic to-date:The U.S. retains higher death rate per 1 million population (844.6), than the EU27 (624.4). Current U.S. death rate per capita is 35% above the EU27, though this gap is still closing (it was 42% a week ago).Gross counts of deaths in the U.S. >> the EU27 over 12/07 – 1/12.  This was reversed on 2/12, with total EU27 deaths currently at 278,914 vs the U.S. 276,316. Adjusting deaths to account for a 1 week lag in the onset of pandemic in the U.S., relative to the EU27, current U.S. deaths are 21,435 above those in the EU27Adjusted for population and pandemic timing differences, the U.S. deaths are 77,048 above those in the EU27.While the EU27 led the U.S. in new deaths and case counts through 20/11, since then, the U.S. has retaken the

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4/12/20: COVID19 Update: Countries with > 100,000 cases

December 5, 2020

As of today, 67 countries around thee world have registered > 100,000 cases of COVID19. Here are the summary tables of core statistics covering these countries:Summary stats:Since the start of the second wave of the pandemic in Europe, EU27 are now once again having higher share of contributions to overall death counts (18.5% of world’s total) than the corresponding share for thee U.S. (18.3%). Actual gap is 0.172 percentage points. However, in more recent days, EU27 new case numbers have been falling, while those in the U.S. continue to rise. This suggests that in weeks to come we are likely to see another reversal in deaths shares.Just two weeks ago, combined share of global deaths accounted for by G7 countries plus Spain stood at 34.5%. Today, it is at 35.0%. For the U.S. the number

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4/12/20: COVID19 Update: Worldwide Cases and Deaths

December 5, 2020

Updating data for COVID19 pandemic worldwide:Global number of daily new cases was on an upward trend through July 2020. In August, new daily case additions have been relatively flat. However, since the start of September, new daily case numbers have risen once again, implying that Global Pandemic is yet to attain its first overall peak.New daily cases have appeared to peak for the current wave of the pandemic around November 21. However, since the start of December, 7 days moving average has resumed its upward momentum. This implies that we must exercise extreme caution in interpreting end of November timeline for the peaking of the second wave.The chart above clearly shows the difficulty in interpreting global peak of the pandemic. Overall, notionally, we have experienced what appears

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3/12/20: Ireland PMIs: November

December 3, 2020

Ireland PMIs are out for November and they show the impact of the re-amplification of COVID19 impacts on the economy.Services PMI fell from 48.3 in October to 45.4 in November, the lowest reading in 5 months and the third consecutive monthly reading sub-50. The pandemic period average is now at 39.3.Meanwhile, Manufacturing PMI rose from 50.3 in October to 52.2 in November, marking the second consecutive month of readings above 50.0 mark. Pandemic period average is now at 48.2. Construction sector PMI (through mid-November) is at 48.6 – marking third consecutive month of sub-50 readings.As the chart below illustrates, Manufacturing is the only sector that is providing growth momentum in the economy and much of that is down to multinationals. In services sector, activity of multinationals

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29/11/20: Bubblishiousness

November 29, 2020

Illustrating FOMO and Bubblishiousness vs Reality: TeslaSource: https://twitter.com/michaeljburry/status/1333110859329990661?s=20 Ya kidding me, not… It’s like 10:0 score right now…

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19/11/20: COVID19 Update: Nordics & Sweden

November 19, 2020

Updating comparatives for Nordic countries:New cases are blowing up in Sweden and are now on the declining trend in the rest of the Nordics. Charts above are showing Nordic countries adjusted for population size differences to Sweden.

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18/11/20: COVID19 Update: Russia

November 19, 2020

Updating pandemic data for Russia: some summary stats firstThe above stats clearly show that Russian pandemic is in  full-blown second wave of infections and deaths. As the chart below illustrates, however:Russian second wave has been associated with exactly matching dynamics in both cases and deaths without any substantial lags;Both cases and deaths are yet to show any signs of stabilization and peaking (which is distinct from the EU27 experience so far);The two effects combined suggest that Russian pandemic numbers are likely to continue to worsen into December.You can see more Russia summary stats and comparatives to other countries here: https://trueeconomics.blogspot.com/2020/11/181120-covid19-update-countries-with.html.

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18/11/20: COVID19 Update: U.S. vs EU27

November 19, 2020

Comparatives for the pandemic development across the EU27 vs U.S.:Thanks to an absolutely savage second wave of the pandemic, EU27 is now closing the gap with the U.S. in terms of total deaths, both in absolute terms and in per capita terms:Deaths per capita: the U.S. has overtaken the EU27 since May 18, and the trend for the U.S. continued to be worse than that for the EU27 until early October.EU27 death rate per capita has effectively flattened-out at around 308 per 1 million prior to August 2, but has been rising once again since then (498.1 currently).U.S. deaths per capita continue to increase (760.1 currently).The U.S. & EU27 are in 3rd (U.S.) and 2nd (EU27) waves of infections. Since Oct 1st, EU27 cases have surpassed the U.S. on all but 3 days & deaths on all but 16 daysThe trends

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18/11/20: COVID19 Update: Countries with > 100,000 cases

November 18, 2020

Updating the tables for countries with more than 100,000 recorded cases of COVID19:U.S. continues to lead globally in terms of deaths and new cases counts. On per-capita terms, the U.S. ranks 7th worst in the world in terms of cases per 1 million of population, 12th worst in terms of deaths per 1 million of population and 27th worst in the world in terms of deaths per 1,000 officially detected infections. The country has, by far, the most expensive (as a share of GDP) healthcare system in the world.In contrast, were they treated as a single entity, BRIICS+Turkey have better than average performance in terms of number of cases, number of deaths per capita and an average (statistically)  rate of deaths per 1,000 cases.Worldwide, 20 countries now have more than 500,000 cases and 5 countries

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18/11/20: COVID19 Update: Worldwide Cases and Deaths

November 18, 2020

Updating data on global COVID19 pandemic spread:Some summary tables first;November-to-date is an outlier month in terms of both, case numbers and deaths. While the former is in part driven by better availability of testing, the latter runs contrary to the expected outrun of improved testing: higher rates pf testing lead to earlier detection of the disease and, in theory, should lead to reduced deaths. Unfortunately, this is not the case. Daily average new deaths are running at 8.294 so far in November – a massive increase on October and the highest average for any month so far. Worse, thee geography of new cases has shifted from less-developed countries (South and Latin America, India etc) to more advanced economies (the U.S. and Europe), which should, in theory, see a reduction in daily

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17/11/20: U.S. households: Debt Hostages to the Washington

November 17, 2020

Massive stimulus deployed in Q2 2020 has lifted substantially aggregate household incomes. Meanwhile, lower interest rates have boosted debt affordability, while new demand for credit collapsed. All of which means that, at least through 2Q 2020, U.S. households enjoyed some really dramatic reduction in the burden of debt:Income boost from Government transfers in 2Q 2020 was so large, it took household debt to income ratio down by a whooping 3 years in just one quarter, with the ratio currently at the levels last seen in the second half of 1998, moving exactly 3 years from Q3 2001 levels where they stood at the end of Q1 2020. meanwhile, actual debt levels, in US$ terms were down just $52 billion in 2Q 2020 compared to Q1 2020, a decline of only 0.26%. Of course, 2Q 2020 boost to incomes

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16/11/20: The F&*ked Stay F&^ked

November 17, 2020

Here is an updated forecast for full year 2020 distribution of wealth 9based on FRED data though 2Q 2020 and stock markets data through November 16):Hint: no, Donald Trump will not finish his tenure in the White House as the worst President for the ‘bottom 90%’, nor the best…

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16/11/20: Velocity of Money and the Glaciers of Complacency

November 17, 2020

Last time I looked at the velocity of money, things were going South fast: https://trueeconomics.blogspot.com/2020/05/27520-falling-velocity-of-money.html. And considering thee data through 3Q 2020, there is little improvement across the board:You can barely notice 3Q 2020 uptick from the pandemic lows in all three measures, thee M1, M2 and MZM. And here are differentials:Precautionary savings motives (blue line) remain extremely elevated, while investors’ willingness to trade assets (in a bull market, a sign of more active management of portfolios) stays stubbornly low. Which implies that the shift from the pandemic impact to the recovery did not do much to alter demand for money, nor to break away from the monetary policy-supported glut of liquidity available to the economy as a whole

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16/11/20: Retail sales, Sector employment and COVID19 recovery

November 17, 2020

Retail sales suffered a sharp shock from the demand contraction following the first phase of COVID19 pandemic. As of the end of September, based on the preliminary estimates from the U.S. Census Bureau, total volume of retail sales in the U.S. has fully recovered to pre-pandemic levels:Based on cumulative retail sales over trailing 12 months period, September 2020 stood at USD 5.519 trillion, which is USD48.371 billion above 12 months trailing cumulative for January 2020, and USD121.178 billion above the same measure for September 2019.The same cannot be said about the recovery in the retail sector jobs:As of October 2020, total employment in the U.S. retail sector stood at 15,173,500, 498,500 down on February 2020 and 471,200 less than in October 2019. In fact, the problem with the

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