Mosler Economics

Dismal: Highlights The purchase index is down a sharp 4.0 percent for a second straight week, this time for the April 26 week. Year-on-year, the index is up only 1.0 percent which is not a favorable signal for the Spring housing push. Refinancing is also coming down, 11.0 percent lower for the fourth straight weekly decline after having spiked dramatically on a break lower in mortgage rates. And rates are still very low, down 4 basis points in the week for 30-year...

Personal income not doing so well, as growth keeps ratcheting down: China April factory growth unexpectedly slows as economy struggles for traction (Reuters) The official Purchasing Managers’ Index (PMI) for manufacturing fell to 50.1 in April from March’s reading of 50.5, which was the first expansion in four months, data from the statistics bureau showed. Output expanded at a slower but still moderate pace, while growth in new orders eased only slightly. The official...

Headline number looks strong, but details show weakness, particularly personal consumption expenditures which continue to decelerate: Highlights The consumer isn’t on fire but still contributed to a very solid 3.2 percent growth rate for first-quarter GDP. Net exports are the driving force of the headline rate, still deeply negative at minus $899.3 billion but nevertheless contributing 1.03 percentage points to the quarter’s calculation though trade data for March, which...

As per the chart still not looking so good: Highlights Good news on US manufacturing is now much less scarce following a much better-than-expected 2.7 percent jump in durable goods orders for March. The gain is skewed higher by a very welcome 60 percent monthly gain in commercial aircraft orders and also by an equally welcome 2.1 percent rise in motor vehicle orders. Excluding these orders as well as orders for all other transportation equipment, March orders rose a...

Ship Orders Fall to Lowest Level in 15 Years Ship orders world-wide have shrunk to the lowest level in 15 years as vessel owners struggle with excess capacity that has kept freight rates well below break-even levels. There were 3,200 vessels of a combined 81 million gross tons ordered globally in the first quarter, the lowest figure since 2004, marine data provider Clarksons PLC said in a report released Friday. Headline export and import news still negative: Taiwan...

Still heading south: In addition to tightening requirements, states have found other means to keep people from receiving benefits: Has the economy made it arder to get unemployment benefits? Not every terminated employee is eligible to receive unemployment benefits. You have to earn a minimum amount to even qualify; you cannot quit or be fired for cause, as defined by Illinois law; and you must actively search for alternative employment. With these requirements in mind,...

Not looking good: German Factory Activity Continues to Contract in April The IHS Markit Germany Manufacturing PMI rose to 44.5 in April 2019 from the previous month’s near seven-year low of 44.1, but below market expectations of 45, a preliminary estimate showed. Still, the latest reading pointed to a sharp contraction in the manufacturing sector, as inflows of new business fell for a fourth straight month led by a further steep decline in new export orders, which dropped...

Imports and exports both decelerating indicates a weaker global economy, and weak US retail sales indicates domestic consumer spending growth is slowing: Highlights First-quarter GDP looks to get a major boost from improvement in the nation’s trade deficit which, for February, came in at much lower-than-expected $49.4 billion. And the positives are more than just a technical calculation as exports, driven by aircraft, jumped 1.1 percent in the month on top of January’s 1.0...

Still looks to be weakening: Looking weak: Tariff wars taking their toll:

Tax Reform Exacerbates Sales Cooldown in the U.S. (WSJ) U.S. tax reform has exacerbated a gradual cooldown in U.S. home sales over the past year in certain parts of the country, according to research from realtor.com. The Tax Cuts and Jobs Act, which went into effect on Jan. 1, 2018, allows homeowners to deduct mortgage interest on a loan up to $750,000—down from $1 million—and caps state and local tax deductions to only $10,000. Home sales fell 6% across a sample of 30...