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Tag Archives: capital goods

More Down In The Downturn

Flash PMI’s from IHS Markit for the US economy were split in October. According to the various sentiment indicators, there’s a little bit of a rebound on the manufacturing side as contrary to the ISM’s estimates for the same sector. Markit reports a sharp uptick in current manufacturing business volumes during this month. The manufacturing index came in at 51.5, up from a revised reading of 51.1 in September based almost entirely on the production subset. But at the same time, a decided drop...

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Durable Goods And 1998

We have arrived at revisions season once again. It’s that time of year when many if not most (I don’t actually keep track) of economic accounts undergo heightened scrutiny. More data is collected from more comprehensive surveys using far larger samples. These are compared to the existing high frequency panels and changes are made as necessary. Sometimes these are substantial, as we’ve been noting for the past half-decade or so. As is the tendency near always on the downside. This year is...

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Monthly Macro Chart Review: April 2019

The economic data reported over the last month managed to confirm both that the economy is slowing and that there seems little reason to fear recession at this point. The slowdown is mostly a manufacturing affair – and some of that is actually a fracking slowdown – but consumption has also slowed. On a more positive note, housing seems to have found its footing with lower rates and employment is still fairly robust. The US economic growth rate in this cycle has been disappointing...

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Finally Closing The Book On Harvey and Irma, Opening A New Economic Chapter To?

I, for one, am sick of still writing about 2017’s tropical season. It’s been well more than a year and yet we are just now finally moving past them. It would’ve been healthier and more honest had there been more appreciation for what they really were going to do for/to the US economy. Without any more artificial interventions left, the US system really begins to look shaky again. It is surprising to far too many maybe otherwise rational people. In the manufacturing business, Harvey and Irma...

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Fake Boom No Match For the Calendar

The manufacturing renaissance at the base of this supposed US economic is disappearing. It is unsurprising, quite predictable actually. First, there was the cleanup from last year’s major storms and then frontrunning potential trade restrictions. Manufacturers domestically were gearing up for a whole host of non-economic reasons. If Keynes had ever been right about activity for the sake of activity, it would have shown up here. Instead, after twelve months of favorable comparisons economic...

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Alternating Durable Goods, Three Month Lumps Back to Cool

Heavy manufacturing in the United States has taken on some unusually lumpy characteristics. Over the past year, it has advanced, to be sure, but in very noticeable fits and starts. It therefore raises the same question as the economy has been dealing with since 2007. We’ve seen growth periods like this before, low ceilings and all. This one so far isn’t different, so we have to wonder if it is sustainable. The raw numbers sound appealing enough. Excluding transportation industries, new...

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Durable and Capital Goods, Distortions Big And Small

New orders for durable goods, excluding transportation industries, rose 9.1% year-over-year (NSA) in January 2018. Shipments of the same were up 8.8%. These rates are in line with the acceleration that began in October 2017 coincident to the aftermath of hurricanes Harvey and Irma. In that way, they are somewhat misleading. The seasonally-adjusted data gives a better sense of the distortions created by those storms. New orders for durable goods on a monthly basis fell in January 2018 from...

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December Durable Goods

Durable and capital goods orders and shipments all increased in December by growth rates consistent with those registered in the months leading up to the big storms Harvey and Irma. We continue to find evidence that accelerated growth in October and November was nothing more than the anticipated after-effects cleaning up after those hurricanes. New orders for durable goods (excluding transportation orders) had increased year-over-year (unadjusted) by 6.2%, 6.8%, 6.6%, and 6.7% in the four...

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Bi-Weekly Economic Review: Housing Market Accelerates

The economy ended 2017 with current growth just slightly above trend. In general the reports of the last two weeks of the year were pretty good with housing a standout performer going into the new year. We are still trying to get past the impact – positive and negative – from the hurricanes a few months ago though so it is probably prudent to wait for more evidence before making any definitive pronouncements about the economy. While the data has been good lately the reaction in...

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Durable Goods Only About Halfway To Real Reflation

Durable goods were boosted for a second month by the after-effects of Harvey and Irma. New orders excluding those from transportation industries rose 8.5% year-over-year in October 2017, a slight acceleration from the 6.5% average of the four previous months. Shipments of durable goods (ex transportation) also rose by 8% last month. Even with that slight quickening, these are not growth rates consistent with healthy economic conditions. Instead, the rebound in durable goods in 2017 is...

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