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Chicago PMI Surges, Trounces Expectations, Despite Across The Board Responder Pessimism
Making a complete mockery of regional Fed indices, the June Chicago PMI just printed at a ridiculous 61.1 on expectations of 54.4, up from 56.6, in the process posting its 21st month of growth. Everything is now being done to prevent the all critical now ISM from printing below 50 and to extract as much juice as possible from the last QE2 POMO (the subsequent POMOs are part of the continuing QE Lite). From the report: "PRODUCTION and NEW ORDERS accelerated to mark nearly two years of expansion while their three-month averages declined; ORDER BACKLOGS diverged from improvements in PRODUCTION and NEW ORDERS; Breadth of inflation reported in PRICES PAID eased for a third month." Among the indexes that surged were Production (up from 56 .0 to 66.9), New Orders (from 53.5 to 61.2) and Capital Equipment (120.8 to 135.0). While prices paid declined modestly from 78.6 to 70.5, the biggest drop was in Inventories which plunged to 46.9 from 61.6: this is not good for the I in GDP, although everyone has now written off Q2 GDP so this is irrelevant.As usual the respondents provide the best color, and nobody captures it best than this guy: "The recession, the "recovery," and the disappearance of industrial arts in our schools seem to have diminished a formerly strong labor pool" and this: "Hopefully something will break or the 4th quarter is going to look sad."
As always the best color comes from the responses in the actual survey report. Please tell us where any bullishness can be found.
1. "Material availability still tight, though much better than the last few months. Prices are on the upswing. No coincidence, I am sure. The dearth of available raw goods is still [our] foremost concern as it stifles our ability to grow the business though, the competition also suffers from the same problems. I am not certain that this is necessarily a good thing as widespread stifled growth will weigh heavily upon an already weak economy and we all know what happens when you overload an old tired mule."
2. "Material inflation, Steel and Aluminum, still impacting cost. Weak housing and commercial construction hurting overall business."
3. "Producing ahead to avoid know future contract price increases. Chemicals market still shows volatility with no end in sight."
4. "Paper and film lead times growing."
5. "Incoming orders have definitely slowed down. Several orders we expected to see are currently on hold. Hopefully something will break or the 4th quarter is going to look sad."
6. "It looks as if manufacturing is showing signs of slowing down."
7. "There may be a little softening coming but its too early to tell."
8. "This actually is our slow time of year. From Middle of April through Middle of August is our slowest time of year. We always see a huge spike in orders and shipments to customers starting late August through March of the following year."
9. "Suppliers continue to have trouble finding skilled workers. The recession, the "recovery," and the disappearance of industrial arts in our schools seem to have diminished a formerly strong labor pool."
Full report here
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Sell the news.
Does Obama's hometown produce reliable data?
Pay no attention to the man behind the curtain.
I am the mighty OZ.
One only needs to read the first word to devine the level of significance of this report.
Rahm Emanuel.
This is what u always see before this number is released. And the same goes with UMichigan CONsumer conf.
Funny how these "markets" work nowdays. Bad data gets ignored and when there's even a single positive datapoint, equities go through the roof. Long live central planning!
That explains the jump a couple of minutes before the release.
The fact is, the fix is in. Banks sell down the markets in order to put pressure on governments to go gently on any talk of haircuts for Greek bonds, everything looks fragile, governments cave and then the banks do their part by ramping markets higher, so the plebians forget how much money they just gave the bankers.
I don't know what to call it, but it isn't capitalism
As I said, things will eventually get better.
Do you want to be short stocks when that happens?
Another man behind the curtain are earnings reports. They've been quite positive as well.
look in the mirror. just last week you were shorting with both fists (your words) and earlier in the year you were "itching" (your words) to get short.
robottrader: the ultimate dumb money indicator.
Yes: Sell On The News late in a cycle
Gee Robo, what happened to your calls from just a few days ago where you said youre about to go short big time? Guess it helps having those rear view mirrors mounted on your monitor with plenty of Windex handy for your expert after-the-fact trading style.
robo wakes up a new goose every morning
Ring ring...Ahhhh hello PMI headquarters, this is your president and the Bernanke here, yes Mr President what may I woe the honor of your phonecall, ahhhhh we need you to make that report positive this morning..Ben what is this report anyway? Don't worry Mr President you will not understand it anyway, remember our QE chat, ahhhhh ok Ben, you know best, and you know I am pinning my 2012 hopes on your printing ability, yes Obama I am aware of that. ISM caller gets off the phone and says "jesus this is the 5th time this year they have asked me to doctor this report, what a bunch of crooks"
No, they did not ask you to doctor the report. They told you to doctor the report. We are living within a National Security State folks. You can do anything when you claim the enemy is at the gates. We don't really think we are getting real numbers......do we?
There are lies, damn lies and.....more lies?
Given the responses vs the numbers, I would have to call BS. Businesses are seeing price increases (inflation) and material disruptions continuing. Those that have non-perishables are producing ahead (increasing inventories) which could mean a slowdown in that sector in the coming quarters. I'm reminded of Bullwinkle and his coat and tails telling Rocky, "Hey Rocky, watch me pull a positive number out of the hat"
If it wasn't the last day of the quarter, and the last day of the QE2, I would seriously think of getting long the market, because this is fu*king insane how they are rocketing it up?
I start to think that in this fu*ked up world we are all wrong, and loosing money in accordance.
Who would short the market? It is clear that the empires have fairly strong control over the situation. It is clear where their position is towards speculators and shorts. The illusion can be maintained for years especially with strong corporate earnings and no extremes in the fundamentals.
That is exactly what scares me, it can go on forever like this.
LOL, youve been fooled into believing the POINT is to keep an illusion going for years? Wow, couldnt be more wrong.
don't be too comfortable in your stepping over the bear trap because your next step is the tiger trap laid just beyond
Its all a game anyways, what stopping you from playing opposite man?
Tho i'm betting on a bout of sanity to be served shortly :)
Nothing stops me from going opposite, and I go the "opposite" way a lot of times, but when I think that the market is facing some big, BIG, BIG problems, there is allways some shit they come up with to stop and mask the shit. In such situations I get monkey hammered, and I am tired of it.
Seems like they try to stop a baby (market) from crying, they will do anything just to avoid the market of being A MARKET.
EDIT: I red again what I wrote, I must say that I am Captain Obvious
And interestingly enough, silver declines on the news...........even though all the paper bugs will tell you it is mostly an industrial metal.
So to all the Meth Mans out there. Which is silver. Is it an alternative to the dollar, which would cause it to slide on good manufacturing indications? Or is it an industrial metal, in which case it should appreciate in value when manufacturing indicators are good?
Oh, that's right. It's just manipulated to suit whichever thesis you wake up with in your head in the morning.
Well this is hardly a 'GOOD' number at all, taking 1 step up from the root cellar is hardly reason for celebration.
Ber-shankie: "Let them enjoy the 4th".
'Get drunk all weekend as usual, Sheeple-merica....we're not quite ready to pull the rug out from under your dumb lazy complacent asses yet...but watch out for next week. Eat up little sheepies....eat, drink, and be stupid...we're gonna get you so fast you wont have any idea what the hell happened'
Curious how Chicago always comes through for Obummer.
Not surprising at all, the ballerina Rahm Emanuel is in charge.
ballerina Rahm Emanuel
+1 :)
The DOW is now trading up more than 100 points putting it positive for the
quarter. The plan for the rich to enslave the poor is well under way with the
Greeks willingly accepting their chains thus becoming the template for the rest
of European debtor nations. All is well in the world of the elite.
Yes and its so easy to bankrupt and enslave americans, probably way easier than they originally thought as americans are so easy to lie to and live in a state of normalcy bias its even shocking to the Illuminatis....job well done, elites. Theyll never see it coming ever, youre home free.
I guess that's nice. But anymore, how much of this is revelvant to the domestic US? With the rate of outsourcing this could be good news... but not necessarily the US. The index indicates a pick-up for someplace but where exactly that is, is not known.
my long term s and p chart with a bit of cleaning for the folks here. started sometime in 09, without much changes except tp update some speed lines for shorting purposes and advance the dates on the chart. the basic format and main structure hasn't changed and it's been very good to me. this isn't my site, I get no money for giving it out, etc.
david has sent you a Stock Chart from FreeStockCharts.com. Click below to view it.
http://www.freestockcharts.com?emailChartID=38bbde83-e560-4feb-844d-fd3e1ddf3bb8
Window dressing nearly complete. Look out next week.
"Suppliers continue to have trouble finding skilled workers. The recession, the "recovery," and the disappearance of industrial arts in our schools seem to have diminished a formerly strong labor pool."
Translation:
American labor is too expensive for us, but we like to pretend otherwise and come up with any excuse to the contrary so we can live with ourselves and ignore reality.
I hear that. Firms never object to the public investment in skills, never obejct to the price stability monetary policy gives them, or to the labor policies which artifically complicate the labor market, such as those intended to 'end discrimination', which become the leading exuse by firms looking to hire ex-US. They also enjoy the systems such as food stamps, disabilty, unemplyement and other social safety nets that conveniently keep their consumer bases in place and not wandering off for new jobs someplace else even for reduced wages. Basically the public sector is one big arbitrage network and the players are hoping they'll know when to leave the table. Not that either political party will tell you that.
OT, but only slightly: Good news, and bad news.......
First, the bad news: Obomber's "top adviser on national security" released a "new" counterterrorism strategy a few days ago. From Soros & Ariana:
Now, the good news: The last bunch still trying such total internal suppression to stir economic growth has apparently [nearly] succeeded! From the Telegraph (UK) here:
It looks to me like the Dear Leader is planning to share in the NWO 2012 spoils! Another one to add to my list of governments that seem to know something about 2012 that we don't know yet. Like I've said a number of times: No POTUS election next year.
They all know whats coming soon, meanwhile sheeple like Robo thinks its all about stocks.
ISM NY this morning plunged: 52.6 from 67.9 on Wall Street layoffs and soft manufacturing.
Of interest was the comment that for the first time a significant number of respondents cited decreased working capital as a problem. That's a new wrinkle since the "huge amounts of cash on the balance sheet" recovery has been assuming that there's dry powder left over to power the recovery after the government withdraws support. Not.
Funny how QE is ending, but normalcy bias is so solid that they've got everyone believing it wont end.
Top officers at S&P 500 saw average earnings rise almost 20%. That's where lots of that money went. Of course that figure is hiding the rest of the iceberg: stock and options and expense accounts.
booyah
Big question is can things be jimmied nearly as well without heavy QE?Residual effect may last perhaps through next week. It shouldn't be that one hopes for a major swan event just so the breakwater crumbles, but mirages have a way with fucking the mind.
Inferential Statistics: Designers, Operators, GDP & Currency
The operators have absolutely no idea how the real economy functions. They can only infer with an inflation feedback loop, which they suppress with their own filter. All they can do is measure what happened yesterday, extrapolate into the future, and repeatedly brainwash the population from birth. On what planet is revenue, GDP, the heat coming off the resistors, an appropriate basis of NPV, regardless of the cost of current revenue to the future?
The difference between Volcker and Greenspan is that the former understands Caesar’s limits. Greenspan “thought” he was a designer, because he could write a few lines of code, which locked him into the media wave before he fully realized the true nature of positive feedback in a dc circuit.
Designs come from the bottom up (go ahead, tax small business some more). They are operated from the top down(go ahead, give GE some more). The most effective way to do maintenance is randomly, because you may rely upon the copiers to make copies (best business practice). All Caesar has is copiers watching copiers copying, on auto. What happens when you make a copy of a copy of a copy, especially in DNA?
The machines work for you, not the other way around, if you understand the design. On the third machine error, pull the hook to reset. If the problem repeats, find out where the voltage stops and fix the device. If the problem persists, you have a symptom from a source above you. Work your way up.
You are in the midst of rolling recessions and the operators have thrown $20 trillion in the hole over the last three years on an exponential curve. What does that tell you about inferential statistics as a design tool and GDP as a feedback mechanism?
Mechanics should get good money, but not to hide the circuit in panels made for the purpose all over your car, laugh at lower level operators who are experiencing exponentially increasing symptoms, or to test equipment with no load on the motor using a dummy light (you would think that would be a dead give away, but no ….). Tell them to get their f***ing meters out and show you. What does it tell you if all the mechanics are working on the day shift and only come out when they can no longer avoid a problem, carrying a dummy light?
Well, it didn’t take long to get that third point on a line: damn good worker, $40/hr type, making $11/hr, taking home $100/week, after Family Law, working for a temp agency, gets chewed out for the work of a couple of kids, who are maximizing end-of-production-line variability, sending the problem, wave form, back to where it came from, amplified. Do you think management has any idea that crap is flying all over the place because the CPU is locked up, frying the resistors in the loop at the time?
They threaten to fire this guy in the first meeting, give the kids a pay raise in the second meeting, and call me in for the third meeting, which didn’t go quite the way they planned. Every single job in this automated plant depends entirely upon that black hole of a currency, the Australian dollar …
Just because there is a massive abundance of make-workers creating heat doesn’t mean there is a surplus of labor capable of creating wealth. Will meteors fall from the sky in August when monetization hits the tipping point? No. Will people stop getting dialysis? Yes. How many more gears are going to be required / split if the global economy comes to a dead stop in the time/derivative domain? Where is Wyle E Coyote in the frequency/integral domain? Rethink the speed of gravity from outside the time domain box.
Architects are like mystery shoppers; operators want-to-be on the front page of the WSJ, “explaining” what happened yesterday, to convince each other that they should be in charge tomorrow. The President takes credit if things go well, and is the scapegoat if not, so tribute payers can have their pie and eat it too, which comes from a copy of a copy of a copy, of a recipe, which the cooks all claim to be their own, in Court.
I could dramatically increase the effectiveness of this plant, but I don’t have to do anything to prevent Caesar from loading the spring. In the “old” days, you had to deal with your brothers if you gave the bully a pass, and the old man when he got home. Let others think and say what they want, but never, ever, never, allow anyone to define your identity.
Ask anyone who has ever worked with me. When others f*** with one of my kids, I drop the entire load on them, at the worst possible time in their miserable lives. By all means, stand right there on that X that says a TBTF system cannot spend itself into bankruptcy, while it burns the pension promises to keep fueling the market as the basis for NPV, trying to prove that intelligent kids are replaceable, with copy machines.
Just bet the change x participation. You don’t care whether it goes up or down. They can only move the cattle so fast, and the feedback mechanism is locked up.
So, a self-destructive kid says to me this morning, no joke, “there is nothing wrong with technology. The problem is the American Dream, working until you’re old so you can do nothing, and kids going to school instead of going out and learning something real. It’s back-assward.” Then he tells me they want to drug test him. Crack me right the f*** up.
http://www.consumerindexes.com/
I've been keeping an eye on the slide in the CMI index, but a couple of weeks back there were a couple of small bumps up (that look like experiments to test what it would take to get a bounce) and then a strong and rather suspicious looking upwards run (faster than even in late 2008 and early 2009!).
... sumptin' not rite wiff dis me finks!
My first guess was the FedSatan, or the Obama decided to goose the line by buying a fleet of new Gulfstreams and Super Sea Knights online (for when a mere Blackhawk POMO just ain't gonna cut it).
Anyone think this line went up like that because of REAL online demand via credit, for durables?
nah ... I didn't think so ...
The last sustained rise began at the height of the double dip-specuation in Oct, just before QE2 began ... but here is QE2 ending, ... and we see this rise?