Mosler Economics

US Factory Orders Fall the Most in 6 Months New orders for US manufactured goods fell 0.8% in April, the most since October last year, due to lower demand for transportation equipment, computers and electronic orders, and primary metals. Meanwhile, shipments of manufactured goods declined 0.5% in April, the largest drop since April 2017. Highlights At an as-expected minus 0.8 percent, April’s factory orders report closes the book on what was a weak month for US...

Global contraction in progress… :( US construction spending

Slow motion trainwreck by Agent Orange, aka Tariff Man, continues… Below 50 indicates contraction: Demand for Saudi oil has fallen back: Saudi pricing of discounts generally trending higher but most recently there’s been a small move back: And how about this? https://www.cnbc.com/2019/06/03/trump-calls-for-a-boycott-of-att-to-force-big-changes-at-cnn.html

Interest-Rate Policy Is Backward, Modern Monetary Theory Pioneer Mosler Says Under consumption identity: for ever agent that spent less than his income, another must have spent more, or the output would not have been sold. In other words, deficit spending, private or public, is the ‘offset’ to unspent income (savings). The chart shows one of the components of private sector deficit spending which appears to align with economic growth: Tariffs (levied on the grounds that...

More of same as trade war takes its toll globally: Headline Durable Goods New Orders Declined in April 2019. Inflation Adjusted New Orders Are In Contraction Trump to Democrats: No infrastructure without trade deal On the eve of a highly anticipated meeting with Democrats at which President Donald Trump was expected to unveil a way to fund a $2 trillion infrastructure proposal, Trump instead put Congress on notice that it will have to take a backseat to a trade deal....

Real final sales slowing, and business equipment growth negative: From the NY Fed, reads like credit growth slowing: Total Household Debt Rises for 19th Straight Quarter, Now Nearly $1 Trillion Above Previous Peak The report includes a one-page summary of key takeaways and their supporting data points. Overarching trends from the Report’s summary include: Housing Debt Mortgage balances rose by $120 billion, to $9.2 trillion. Mortgage originations declined to $344 billion...

Weak and weaker than expected: Highlights The second quarter gets off to a stumbling start pulled down by a 0.2 percent headline decline in an April retail sales report where the core details show unexpected weakness. Excluding autos, in which sales were already expected to fall sharply, April sales managed only a 0.1 percent gain to fall underneath Econoday’s consensus range. Excluding autos and also gasoline sales, which were already expected to rise sharply, sales fell...

Headline number looks promising. The question is whether employment will lag the other indicators that are decelerating, or provide the support that turns them around. And note the .1 drop in the work week is equivalent to maybe to something over 100,000 jobs: Highlights That sound you hear is the economy revving up. Nonfarm payroll growth easily beat expectations at 263,000 in April as did the unemployment rate with an outsized 2 tenths decline to a 49-year low of 3.6...

Continues to decelerate: Highlights Jerome Powell may have cited March auto sales as an economic plus in yesterday’s FOMC press conference, but April sales couldn’t keep up the pace. Unit vehicle sales managed only a 16.4 million annual rate in April which was far below March’s 17.5 million rate and well below Econoday’s consensus range. The setback returns the sales pace to the disappointing mid-16 million range of January and February that was a ratcheting down from the...