Mosler Economics

From bad to worse:Another May reversal from a hopeful April gain: Richmond Fed Manufacturing IndexHighlightsThe Richmond Fed index fell a sharp 15 points in May to minus 1, adding further evidence of a serious slowdown in manufacturing activity as also indicated in last week’s Empire State and Philly Fed reports for May. Several of the survey’s key measures dropped steeply and went into contraction from previous strength, with shipments down 22 points from April to -8, backlog orders down...

Imports and exports down, as global trade continues to wind down. And the trade surplus remains yen friendly. However intervention will likely prevent any material yen appreciation: Rail Again Moves Deeper Into ContractionWeek 19 of 2016 shows same week total rail traffic (from same week one year ago) declined according to the Association of American Railroads (AAR) traffic data. Rolling averages continue moving deeper into contraction.The deceleration in the rail rolling averages began...

A bit higher than expected now been going sideways for almost a year: Existing Home Sales Euro Area current account surplus continues to zig zag it’s way higher: Euro Area Current AccountEurozone current account surplus came in at €32.3 billion in March of 2016 compared to an upwardly revised €11.2 billion surplus in the previous month. The surpluses in balances of goods (to €36.1 billion from €25.2 billion in February) and services (to €4.5 billion from €3.2 billion) widened while the...

Back into contraction after a blip up in April: Philadelphia Fed Business Outlook SurveyHighlightsAfter popping higher in March the Philly Fed index has been dead flat since, at minus 1.6 in April and now minus 1.8 for May to point to slight contraction in the Mid-Atlantic manufacturing sector.After jumping to 15.7 in March, new orders posted a zero in April followed now by minus 1.9 in May. And contraction in unfilled orders is deepening, at minus 8.8 vs minus 6.3 and minus 1.9 in the...

Another setback for those grasping for straws looking for housing to lead a recovery: MBA Mortgage Applications Gas prices up enough to hurt consumers, but not enough boost oil capex. You might say it’s in the ‘sour spot’:Again, for all practical purposes this IS full debt forgiveness, and something Greece has yet to recognize as such: IMF Proposal on Greece Sets Up Battle With Germany May 17 (WSJ) — A new IMF proposal goes far beyond what Greece’s eurozone creditors have said they are...

Still below the Fed’s target and ‘core’ moving down a bit year over year: Consumer Price Index Housing starts better than expected, permits up a bit and last month’s revised down a bit. And, of course, no house legally gets built without a prior permit and the chart isn’t looking promising: Housing Starts Still down and out:And E commerce retail sales growth is working its way lower as well:Note the % change this year vs last year chart, which takes out all the ‘seasonal’ factors,...

Not good. Raises the specter of May having weakened after some April numbers were looking a bit better: Empire State Mfg SurveyHighlightsWhat little momentum there was in the New York manufacturing sector is fizzling, based on the Empire State index which came in much weaker-than-expected, at minus 9.02 in the May report to end two lonely looking gains in April and March.New orders are at minus 5.54, also ending two prior months of gains and rejoining a long run of negative readings going...

Weak U.S. tax receipts suggest things are not so good for the U.S. consumer even as employment continues to grow, Deutsche Bank Chief U.S. Economist Joseph LaVorgna said Monday.The three-month moving average for U.S. jobs gains remains “good” at around 200,000 positions per month, but growth in tax receipts has fallen from about 6 percent a year ago to 3 percent today, LaVorgna said.”That tells me income growth is a lot weaker than what official numbers show, which would explain why...

Better than expected and some upward revisions as well. Retail SalesHighlightsThe consumer snapped back to life in April, driving retail sales 1.3 percent higher to beat Econoday’s consensus by 4 tenths and the high estimate by 1 tenth. Gains are spread throughout most of the report.Autos are the key component, up a sharp 3.2 percent to reverse the prior month’s decline. Excluding autos, retail sales rose 0.8 percent.Sales at gasoline stations, boosted by higher prices, also contributed...

Check out the second chart: 2016 Q1 call report data is available at BankRegData.com. Industry wide assets leapt to $16.293 Trillion adding an amazing $325.59 Billion (2.04%) in the 1st Quarter.The $325.59 Billion increase is the largest since (you guessed it) the $337.96 Billion jump in 2008 Q1 – a span of 32 quarters.What’s even more amazing is that the 1.24% would really be 1.28% if C&I lending had stayed flat. The jump to 1.24% was actually lower than it should have been due to the...