Chicago PMI was released, printing at 70.6 on expectations of 69.9 and a decline from the prior 71.2. As Japan's PMI released earlier, look for this data series to drop substantially once the impact from the Japanese tragedy is felt in the US. Among the more amusing series in the index was the Order Backlog which hits the highest since February 1974, and the Employment index which hit a ridiculous 28 year high, and the second highest since February 1973. Most notably Price Paid, rising to 70, was the highest pring since July 2008 A few more points here and this index will be the highest since 1980. The followign surve response says it all: "1. It seems like it's time for everybody to jump on the "price
increase" bandwagon, justified or not. 2. Disasters in Japan will cause
inventory to blip upward as contingency plans are placed into effect. 3.
Challenges remain for offsetting any price increases incurred during
2011." Nothing else to be added.
As usual, the most information can be gleaned from the general comments in the Survey Panel:
1. ?Commodity inflation hurting profits. Issuing first pricing increase in 3 year to help recover.
2. ?Chemical Pricing is through the roof right now. Instability in oil markets as well as high demand & low supply due to crop feedstock are serious concerns. Steel and Plastic have risen. Continued inflation will have negative impacts on our ability to pass costs on to our customers in the short term.
3. ?1. It seems like it's time for everybody to jump on the "price increase" bandwagon, justified or not. 2. Disasters in Japan will cause inventory to blip upward as contingency plans are placed into effect. 3. Challenges remain for offsetting any price increases incurred during 2011.
4. ?A lot of skittishness up and down the supply chain concerning the effects of fallout from Japan.
5. ?Japanese produced electronic components will affect our production and customer shipments beginning in 1 to 2 months.
6. ?Japanese situation is full of uncertainty. Problems could exist delaying customer shipments.
7. ?We are in trade show registration/management. We have seen an increase in show attendance for the past 6 months. People are starting to attend shows again. They are also increasing the number of people sent to the shows from individual companies. We saw a significant drop over the past 2 years as companies sent 1 instead of 3 people or skipped certain shows all together. This may be a sign that things are improving.
8. ?Commercial R.E. (real estate) activity is beginning to slowly show signs of life, especially downtown.
9. ?Skilled labor is beginning to be hard to find, and domestic Raw Material deliveries are not being met and Lead Times are increasing beyond reason (32-48 wks.) and our customers are becoming unsatisfied.
10. ?Strong demand for transportation related products, especially aluminum. Filling vacancies in employment slots, including some new positions created in technology arena.
11. ?Software compliance auditing seems to have enjoyed a great growth spurt. It seems that every fourth person in the lobby asking for a meeting is a third party software license compliance auditor working on commission for some publishing house. Where do they get the idea they will be allowed to toss a scanbot into live production systems to cruise around inventorying mission critical operations.
12. ?The orders keep coming as do the request for quotes.
13. ?The water is far from boiling, but it's water that's warming and not ice.