[unable to retrieve full-text content]– by New Deal democrat Industrial and manufacturing production slid further in October, by -0.3% and -0.5% respectively. They are also down respectively -1.2% and -1.8% from their late 2022 highs: It’s a good thing I suppose that manufacturing is no longer such an important part of the American economy, because as the below graph of […]
The post Production turns more negative appeared first on Angry Bear.

[unable to retrieve full-text content] – by New Deal democrat Let me start with my usual reminder that real retail sales is one of my favorite economic indicators, because it tells us so much about the state of the consumer, and since consumption leads employment, it is a short leading indicator for that as well. In October retail sales rose 0.4% […]
The post Real retail sales jump nicely, but we’re not out of the woods on consumption just yet appeared first on Angry Bear.

[unable to retrieve full-text content]– by New Deal democrat Initial claims have now completely reverted to trend after their recent hurricane-induced blip. Initial claims rose 3,000 for the week to 217,000, while the four week moving average decreased -5,750 to 221,000. With the typical one week delay, continuing claims declined -11,000 to 1.873 million: On the more important YoY basis, […]
The post Jobless claims complete their reversion to pre-hurricane-disruptions trend appeared first on Angry Bear.

[unable to retrieve full-text content] – by New Deal democrat Today’s CPI report for October generally showed stable monthly increases, but slight increases in YoY comparisons. But as usual, it was almost all about the usual culprit of shelter, as more fully parsed below; to wit:  – Headline CPI increased 0.2% for the month, the fourth month in a row […]
The post October consumer Inflation firms, driven – as usual – by Shelter appeared first on Angry Bear.

[unable to retrieve full-text content]Tuesday, November 12, 2024  – by New Deal democrat On Friday I wrote about how the Fed likely contributed, via hurting aspiring homeowners, to the outcome of the Election last week. Today I want to take a look at another issue – wages. As it happens, while I was writing this Paul Krugman put up […]
The post Incomes, immigration, and the election appeared first on Angry Bear.

[unable to retrieve full-text content] – by New Deal democrat Today in the US is officially Veterans Day, in which we salute the service of all veterans. But it started – and still continues in some countries – as Remembrance Day, a somber memorial to all those who were killed in World War 1, which ended on November 11, 1918. […]
The post On Remembrance Day appeared first on Angry Bear.

[unable to retrieve full-text content] – by New Deal democrat This is not a formal post about Tuesday’s election. But with the benefit of “revealed preference” a/k/a 20/20 hindsight, it’s pretty clear that the Fed rate hikes were an important part of why Kamala Harris and the Democrats failed. Because we may or may not be experiencing a “soft landing” […]
The post How the Fed helped Doom the Democrats appeared first on Angry Bear.

[unable to retrieve full-text content] – by New Deal democrat Initial jobless claims continued their return to normalcy this week, as they increased 3,000 to 221,000. The four week moving average declined -9,750 to 227,250, which is tied for the lowest number except for two weeks in five months. Continuing claims, with the typical one week delay, rose 39,000 to […]
The post Jobless claims: back to almost completely normal and neutral appeared first on Angry Bear.

[unable to retrieve full-text content]– by New Deal democrat [I was busy doing my civic duty the past few days. I’ll have something to say about the election at some point later, but not now.] Yesterday the ISM services report came in very strong for the second month in a row, with the headline at 56.0 and the more […]
The post The economically weighted ISM average indicates economy expanding nicely, but likely in latter stage of the cycle appeared first on Angry Bear.

[unable to retrieve full-text content] – by New Deal democrat As usual, I’ll take a quick look at this morning’s headline GDP numbers for Q3 before passing on to my more important focus on the release’s leading components.  Real GDP grew at a 2.8% annualized rate in Q3. Just like Q2, this is a perfectly good number in line with the […]
The post Real GDP for Q3 nicely positive, but long leading components mediocre to negative for the second quarter in a row appeared first on Angry Bear.

[unable to retrieve full-text content] – by New Deal democrat The JOLTS survey parses the jobs market on a monthly basis more thoroughly than the headline employment numbers in the jobs report. For several years, my mantra for a lot of statistics has been “deceleration.” Well, in the case of the employment market, we have passed the point where deceleration […]
The post JOLTS report for September shows continued deceleration in almost all metrics, now close to a cause for concern appeared first on Angry Bear.

[unable to retrieve full-text content]– by New Deal democrat This morning’s repeat house price indexes from the FHFA and Case Shiller continued to show deceleration in this metric which is very important to home buyers. Specifically, on a seasonally adjusted basis, in the three month average through August, U.S. house prices according to both indexes rose 0.3%. This is a slight […]
The post Repeat home sales accelerate slightly monthly, but continue to show YoY deceleration appeared first on Angry Bear.

[unable to retrieve full-text content]– by New Deal democrat My “Weekly Indicators” post is up at Seeking Alpha. Ever since – and in response to – the really good jobs report early this month, interest rate yields on bonds have crept back up, giving back most of their summer gains. That puts some pressure on the long leading indicators. Also […]
The post New Deal democrats Weekly Indicators for October 21 – 25 appeared first on Angry Bear.

[unable to retrieve full-text content]– by New Deal democrat Yesterday we got the existing home sales portion of the rebalancing of the housing market, showing sales down further, and price growth attenuation. This morning, we got the new home slice, which was a virtual mirror image. As per usual, while new home sales are only about 10% of the […]
The post Rebalancing of the housing market, new home sales edition: sales increase, prices firm appeared first on Angry Bear.

[unable to retrieve full-text content]– by New Deal democrat After two weeks of being highly elevated YoY, initial claims returned to a more “normal” range this week, as except for Florida, hurricane disruptions largely disappeared. For the week initial claims declined -15,000 to 227,000. The four week moving average increased 2,000 to 238,500. With the typical one week delay, […]
The post Weekly jobless claims return to near normal appeared first on Angry Bear.

[unable to retrieve full-text content] – by New Deal democrat In the past number of months, I have been looking for a rebalancing of new vs. existing home sales. The sharp increase in mortgage rates beginning in 2022 locked many existing homeowners into their houses, since they could not afford the concomitant increase in mortgage payments that would accrue from […]
The post Rebalancing of housing market continues: existing home sales down, inventory up, price growth moderates further appeared first on Angry Bear.

[unable to retrieve full-text content]– by New Deal democrat One of the well-established long leading indicators is corporate profits. Typically they peak a year or more before the onset of a recession. And the reason makes sense: if there is profit pressure that lasts longer than a single quarter, i.e., it looks like it may be forming a trend, […]
The post Are corporate profits stalling in Q3? appeared first on Angry Bear.

[unable to retrieve full-text content]– by New Deal democrat This week is another light one for economic data, so let me discuss a couple of points explaining why I am cautious, but not DOOOMing. Basically, because there are a lot of asterisks. Today let me follow up on initial jobless claims. The typical best way to look at these is […]
The post A closer look at (why I’m not terribly concerned by) the recent elevated initial claims appeared first on Angry Bear.

– by New Deal democrat

My “Weekly Indicators” post is up at Seeking Alpha.

As per the analysis of monthly data that I wrote about this week, hurricane season continued to complicate the high frequency data as well. With that very big caveat, the underlying tone remained positive.

As usual, clicking over and reading will bring you up to the virtual moment as to the economic situation, and reward me a little bit for reporting and organizing it for you

The Bonddad Blog

New Deal democrat Weekly Indicators for October 7-11, Angry Bear by New Deal democrat

Tags: October 2024

– by New Deal democrat

Much of the data that is being released, like yesterday’s jobless claims data, has to be viewed with an asterisk after it, because of hurricane disruptions. As an addendum to yesterday’s industrial production report, I failed to mention that the BEA that “the effects of two hurricanes subtracted an estimated 0.3 percent” from the total. Even with that increase, production would have been unchanged and manufacturing construction down -0.1%, and both would remains slightly down YoY, so the ultimate conclusion remains the same.

Similarly, Hurricane Beryl in July interfered with construction in July, and then permits and starts bounced back in August. Helene may have affected this month’s report, and Milton almost certainly

– by New Deal democrat

A periodic reminder, real retail sales is one of my favorite economic indicators, because it tells us so much about the state of the consumer, and since consumption leads employment, it is a short leading indicator for that as well.

In September retail sales in August rose 0.4% on a nominal basis. After adjusting for inflation, they rose 0.3%. The below graph norms both real retail sales (dark blue) and the similar measure of real personal consumption of goods (light blue) to 100 as of just before the pandemic:

Despite the improvement in the past three months, over the longer term since the end of the pandemic stimulus in spring 2022, real retail sales have been trending generally flat to slightly declining, while

– by New Deal democrat

Before I get to the (relatively) good news in retail sales, let’s take a look at the bad news from industrial production.

On a monthly basis, production declined -0.3%. Manufacturing declined -0.4%. There were also downward revisions to last month. Both of these continue to slowly fade from their 2022 peak:

On a YoY basis, production is down -0.6%, and manufacturing production is down -0.4%:

For all intents and purposes, manufacturing has been in a shallow recession since late 2022, and that recession continues. This is something that has been well telegraphed by both the regional Fed new orders reports as well as the monthly ISM manufacturing report.

The only reason not to be more concerned is that, since

– by New Deal democrat

The drought in new economic data continues through today. We’ll make up for it all at once tomorrow with jobless claims, retail sales, and industrial production. In the meantime, last week I noted that Hurricane Helene’s impact in Florida and North Carolina was a big part of the reason for the spike in initial claims. Let me follow that up further today.

To begin with, State by State initial claims data is only available on a non-seasonally adjusted basis. So the best way to look is YoY. So all of the graphs below are presented in that format. To show the effect of hurricanes, what I have done in the past is subtract the data from the one or more States most affected by the event, and look at the YoY data for all of the

– by New Deal democrat

 One of my fundamentals-based systems for monitoring the economy is to look at the health of household balance sheets.

Most recessions happen when consumers are under stress. If real wages are growing, if assets that can be leveraged or cashed in (mortgage payments, home equity, stocks) are increasing in value, if monthly debt payments are not increasing, then there is no reason for consumers to pull back, and economic expansions continue. It is only when all of these conduits for spending are constricted that recessions typically occur.

And at present, households are generally in good shape. None of the avenues of spending power have been constricted.

To begin with, real hourly and weekly wages have been increasing

For Indigenous Persons Day: a review of “A Brave and Cunning Prince” by James Horn

 – by New Deal democrat

Recently I read the above entitled book, and found it fascinating. Below are excerpts from an online book review, to which I have added further detail in brackets. I highly recommend it:

“In the mid-sixteenth century, Spanish explorers in the Chesapeake Bay kidnapped an Indian child [whose name they wrote as ‘Paquiquineo’] and took him back to Spain and subsequently to Mexico. [He may not have been kidnapped at all. There is evidence that many of the Indians who went to Europe did so of their own free will, especially younger warriors who were up for a Big Adventure.]  The boy converted to Catholicism and after nearly a decade was able

– by New Deal democrat

Sometimes producer prices lead consumer prices; sometimes they don’t – but in the sense that sometimes there is no lag at all before increases show up in consumer prices. In any event, overall the message from the producer price index this morning was benign, with very little pressure “in the pipeline” for consumer inflation.To begin with, raw commodity prices (red) declined -1.2% in September, continuing their 2+ year downtrend; while final demand prices (blue) increased less than 0.1%:

On a YoY basis, commodity prices are down -2.5%, while final demand producer prices are only up 1.8%:

About the only place where any  (slight) upward pressure shows up is in final demand producer prices for services (gray), which

– by New Deal democrat

Today’s CPI report for September came in almost exactly as I suggested it would in my preview yesterday. To wit:

 – Headline CPI continued increased 0.2% for the month, and decelerated to 2.4% YoY, its best showing since February of 2021. 

 – On a 3 month annualized basis, prices are increasing 2.1%. On a 6 month annualized basis, they are only increasing 1.6%. 

 – energy inflation remains non-existent, with another decline of -1.9% for the month, resulting in a decline of -6.9% YoY.

–  excluding shelter, prices were also up 0.2%, and were once again up 1.1% YoY, the 17th month in a row the YoY change has been below 2.5%.

 – shelter inflation decelerated sharply for the month, up only 0.2%, tied for the least

– by New Deal democrat

Step away from the ledge, everybody; and pay no attention to the DOOOMers, who are surely out in force this morning: the big increase in initial claims was almost all about Hurricane Helene.

By the numbers, initial claims increased 33,000 to 258,000, the highest number since August 2023. The four week moving average increased 6,250 to 231,000, the highest in a month. Continuing claims, with the usual one week delay, increased 42,000 to 1.861 million, the highest since mid-August:

On a YoY basis, initial claims were up 22.3%, the four week average up 8.7%, and continuing claims up 3.4%:

I won’t bother with the “Sahm Rule” unemployment rate comparison this week, partly because this is only the first week of the

Real aggregate payrolls and inflation preview for September

 – by New Deal democrat

Tomorrow consumer prices for September will be reported. It’s almost certain that the best short term forecasting tool from the employment report, real aggregate payrolls, will increase once again. Let’s take a more detailed look.

Post-pandemic, nominally aggregate payrolls have increased relentlessly. Consumer prices increased almost as relentlessly until June 2022. Since then payrolls have continued to increase faster than prices (graph below norms both series to 100 just before the onset of the pandemic):

Here’s the month by month look for the past year. In all but two of the past twelve months, payrolls increased significantly more than consumer

– by New Deal democrat

First things first: there’s almost no significant economic news at all this week until Thursday, so don’t be surprised if I play hooky for a day or two.

The coincident headline news out of last Friday’s employment report was very positive, so most all observers heaved a sigh of relief. Of course, precisely *because* it is coincident, it could all be reversed next month, or by next month’s revisions to Friday’s data.

But since I am all about leading indicators and forecasting, let’s take a deeper look at those indicators from Friday’s report.

First, a little perspective. Recall that last week I was writing about manufacturing and construction. The former has been showing at least mild contraction for many months