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ISM New Orders Less Inventories Decoupling Hits Unprecedented Levels, Implies Sub-45 ISM Composite

Tyler Durden's picture


While all the algos are scanning the ISM general business conditions headline, the New Orders Less Inventories spread, which leads the broader index by 3 months, has tumbled and the divergence between it and the ISM Composite is now at near record wide levels. The last time this spread closed in a favorable fashion was back in 2010, when QE1 and 2 goosed the market and the general manufacturing space. This time around, in the absence of another stimulus, the spread will close again all right, but not the way it did last time around, and explains why an ISM analyst just said new orders "not where we'd like it to be." The sub 50 ISM print is coming. Just not this month.

h/t John Lohman


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Fri, 07/01/2011 - 10:28 | 1418735 Concentrated po...
Concentrated power has always been the enemy of liberty.'s picture

You will be told what to think shortly.  Stay tuned.

Also, if you need a laugh look at this:

He apparently was already told what to think.  And since this is a perfect specimen of the kind of brain each of our leaders has I would advise that you panic.

Fri, 07/01/2011 - 10:35 | 1418770 Cognitive Dissonance
Cognitive Dissonance's picture

Clearly his regurgitation of the talking points didn't go so well. He's young and will learn how to change his speed and delivery.

Fri, 07/01/2011 - 11:17 | 1418948 gmrpeabody
gmrpeabody's picture

Not sure that clip passes the smell test. It looks more like....

Live from London..., it's Saturday Night!

Fri, 07/01/2011 - 10:48 | 1418842 slaughterer
slaughterer's picture

Tyler, please put up the article Jan Hatzius is about to release on today's ISM.  Goldman is back to ... (you will see).

Fri, 07/01/2011 - 11:42 | 1419054 equity_momo
equity_momo's picture

lol wtf??..

Fri, 07/01/2011 - 10:25 | 1418736 Herne the Hunter
Fri, 07/01/2011 - 10:30 | 1418741 101 years and c...
101 years and counting's picture

despite this blowout number, the USD is now falling.


Fri, 07/01/2011 - 10:37 | 1418794 SheepDog-One
SheepDog-One's picture

Must.....destroy....US Dollar......must pump.....bubble stocks......must destroy....must kill.....

Fri, 07/01/2011 - 10:39 | 1418803 Cdad
Cdad's picture

That'd be your Chinese running wild buying Euros again.  Check the EUR/USD cross.

Fri, 07/01/2011 - 10:43 | 1418818 SheepDog-One
SheepDog-One's picture

China is the Mack Daddy-O, handing free money to degenerate Euro banksters for free crack rocks, no one even sees China will then call their debts due, just like US. 

But as long as stawks are green, who gives a shit?

Fri, 07/01/2011 - 10:54 | 1418847 Cdad
Cdad's picture

F'n China, the Wall Street enthroned savior of the world...or at least their paper version of it.  I would have never imagined that my country would bow to the communists in order to make some coin on the way out the door as the nation burns.

For a long time, people have spoken about energy as belonging in the national defense arena.  It would seem that the banking industry issues plaguing the nation should also report to that arena, as well.


Fri, 07/01/2011 - 10:59 | 1418863 SheepDog-One
SheepDog-One's picture

A criminal vampire cabal runs the country, parasites no different than leeches, yes its a damn shame but oh the country burns to the ground all the people are so stupid theyre all placated into submission by some bullshit green color on some IMAGINARY things on a screen known as 'stocks'. They figured out long ago that if they can get you involved in that, (401k, pension) the people can easily be controlled by it, and its ALL imaginary! Wow, what a failed fallen people, fallen nation, and while it all burns to the ground the people actually think its all good. I have no sympathy for them at all.

Fri, 07/01/2011 - 11:31 | 1419013 Girl Trader
Girl Trader's picture

Yes, I am surprised that the military seems to have missed the threat to them.  As you bleed the middle class dry, and the banksters leave the country with All The Money (after all, they are not Americans, but rather international financiers), who will be left to pay the taxes that fund all of those US defense toys?

Fri, 07/01/2011 - 10:31 | 1418747 firstdivision
firstdivision's picture

Jamming the sell button towards EOD to beat the crowd!  This report stinks so bad that I am not buying it.  China and Europe have sent the signal that the recession that really never ended, still hasn't ended.  QE3 announcment t-minus 58 days.

Fri, 07/01/2011 - 10:28 | 1418750 Paralympic Equity
Paralympic Equity's picture

That was it

Fri, 07/01/2011 - 10:32 | 1418753 TradingJoe
TradingJoe's picture

Eventually ALL will reverse to the MEAN!

Fri, 07/01/2011 - 10:36 | 1418775 plocequ1
plocequ1's picture


Fri, 07/01/2011 - 10:29 | 1418754 Cognitive Dissonance
Cognitive Dissonance's picture

This is all so tomorrow Tyler. Live and pump for today cause who knows where the liquidity will come from next week.

Hot dogs for everyone. BYOB (Bring Your Own Bun)

Fri, 07/01/2011 - 11:02 | 1418890 LibertyIn2010
LibertyIn2010's picture

Hot dogs for everyone. BYOB (Bring Your Own Bun)

Isn't that what DSK said to the maid???

Fri, 07/01/2011 - 12:43 | 1419273 Andy_Jackson_Jihad
Andy_Jackson_Jihad's picture

that was awesome

Fri, 07/01/2011 - 10:29 | 1418759 treemagnet
treemagnet's picture

I can remain solvent longer than the Fed can remain irrational.

Fri, 07/01/2011 - 10:37 | 1418780 richard in norway
richard in norway's picture

are you sure? cos dem are some crazy motherfockers at the fed

Fri, 07/01/2011 - 10:41 | 1418810 SheepDog-One
SheepDog-One's picture

Yep exactly treemagnet! My safe full of PM's is perfectly solvent, is actual REAL money compared to their worthless PAPER and ZINC SLUG coins! Now do your best tricks FED, I WIN no matter what!

Fri, 07/01/2011 - 10:35 | 1418767 scratch_and_sniff
scratch_and_sniff's picture


Fri, 07/01/2011 - 10:33 | 1418779 Tense INDIAN
Fri, 07/01/2011 - 10:49 | 1418844 Common Man
Common Man's picture

Thanks INDIAN :)

Fri, 07/01/2011 - 10:39 | 1418802 Xibalba
Xibalba's picture

what, are they trying to get the VIX down to 11?  

Fri, 07/01/2011 - 10:39 | 1418804 SheepDog-One
SheepDog-One's picture

Nothing matters except America is on the eve of another 3 day drunken BBQ fest! WHOO HOOO!! And the REALLY funny part? Its a celebration of their 'INDEPENDANCE'! BWAAAA HA HA HAAAAAAA

Fri, 07/01/2011 - 10:43 | 1418807 Temporalist
Temporalist's picture


If you build it the Rus/Dow/SP will come!

Fri, 07/01/2011 - 10:46 | 1418814 RobotTrader
RobotTrader's picture

Out of nowhere we are up 660 pts this week with really no great news.  Tons of shorts wiped out this week

That's why shorting stocks is like pulling teeth out of an alligator or climbing Niagara Falls.

Betting against Uncle Gorilla is futile.

Fri, 07/01/2011 - 10:49 | 1418825 SheepDog-One
SheepDog-One's picture

Really? Last week you said YOU were a short! So your bet was futile, you lost, and you admit it?

Fri, 07/01/2011 - 10:45 | 1418826 Internet Tough Guy
Internet Tough Guy's picture

Out of nowhere? But momo, you said we were having an economic boom of unimaginable proportions.

Fri, 07/01/2011 - 10:48 | 1418839 Deep
Deep's picture

You really are at the same level as those fast monsy traders. What happened robo, you used to be one of the good posts on this site, now it's as if you would rather get junked and and rile people rather than have saomething insightful.

Just price the markets in gold since 2000.

I rest my case



Fri, 07/01/2011 - 10:52 | 1418854 RobotTrader
RobotTrader's picture

I told everyone I was short big but I closed out those positions last Friday when I was that huge 9 million share buy order on XLF, and I knew the fix was in.

Then I loaded big on the long side.

Fri, 07/01/2011 - 11:00 | 1418865 Deep
Deep's picture

Also you forgot to mention, you sold everything Nov 2007, went short huge and then went long with 100x leverage on March 9, 2009, and you now live in a 100,000 sq foot house, your richer than buffet right?


Your a clown



Fri, 07/01/2011 - 11:00 | 1418866 SheepDog-One
SheepDog-One's picture

Oh bullshit.

Fri, 07/01/2011 - 11:00 | 1418882 Iam Rich
Iam Rich's picture

Most folks don't pay enough attention to your comments RT.  I certainly recall your XLF call and change of heart.  You've been right since Jackson Hole.  Just saying.  Folks here should calm down with is useful to have a contrarian to the general take.

Fri, 07/01/2011 - 11:07 | 1418893 slaughterer
slaughterer's picture

ROBO, question is, what are you going to do today?  Are you, RT, cashing in on anticipation of a market decline next week, or are you expecting to ride your longs higher?  Publish your call before the trading day ends right here for everybody to see. 

Fri, 07/01/2011 - 11:14 | 1418921 topcallingtroll
topcallingtroll's picture

that would be good.  I publish my calls ahead of time.

Fri, 07/01/2011 - 11:14 | 1418906 SheepDog-One
SheepDog-One's picture

DOW has been parked right about here give or take a couple hundred point for the last 7 months. You and Robo are full of shit.

Fri, 07/01/2011 - 11:00 | 1418883 slaughterer
slaughterer's picture

It's true that Robo posted on that 9 million share buy order on XLF last week.  Why don't you start your own blog, Robo?    

Fri, 07/01/2011 - 11:30 | 1418996 scratch_and_sniff
scratch_and_sniff's picture

gosh, must be a bull market.

Fri, 07/01/2011 - 10:44 | 1418822 HowardBeale
HowardBeale's picture

Re: Game with Numbers

Wait for next month's unemployment surge: somewhere between 1 and 2 million educators have been laid off (permanently, not just for the summer) around the country. Pump that.

Fri, 07/01/2011 - 11:29 | 1418988 SeverinSlade
SeverinSlade's picture

Add in the fact that states across the country are now actively laying off thousands of public workers.

Fed unemployment will near or exceed 10% within a month or two.

Also love how the market skyrocketed almost 5% on the Greek vote...The recent bailout is like putting a band-aid on decapitated person.

Fri, 07/01/2011 - 12:11 | 1419166 HowardBeale
HowardBeale's picture

But it's a French designer band-aid.

Given the massive job losses that are about to show up in the "official" numbers, I think we're going to have to rename the four seasons: Spring, Summer, Plunge, Darkness

Fri, 07/01/2011 - 12:11 | 1419168 sleepingbeauty
sleepingbeauty's picture

Also love how the market skyrocketed almost 5% on the Greek vote...The recent bailout is like putting a band-aid on decapitated person.


+1, the visual is pretty disturbing.

Fri, 07/01/2011 - 10:46 | 1418831 10kby2k
10kby2k's picture

Better turn off your TV. Mute won't help...Cramer is probably going to be dressed in red white and green.

Fri, 07/01/2011 - 10:51 | 1418832 n00b tube
n00b tube's picture

Options day trader here. I started buying JUL11 SPY puts Monday and was fully invested (100% short) by Wednesday. None of the news reported here or from MSM validates this rally in the U.S. equity market. However, I'm starting to consider that the markets may never really crash so long as there are no retail investors to "hold the bag." My position will likely be worth zero by Tuesday at this rate. Though, fire selling would be imprudent; there's plenty of time for a market event to bring my position back from the grave. I agree with those of you who advocate the PM's, I just operate on a much shorter time horizon - and I'm being caught in a moment where the market is behaving irrational longer than I can remain solvent. I've been lurking for a long time and enjoyed reading most of the comments.

Fri, 07/01/2011 - 10:51 | 1418846 Bob
Bob's picture

100% short?!  Good luck . . . really!

Fri, 07/01/2011 - 10:51 | 1418851 Temporalist
Temporalist's picture

Market not irrational; market rational in Bizarro Bernanke land.

Fri, 07/01/2011 - 10:55 | 1418860 slaughterer
slaughterer's picture

Welcome to the active poster community.  I have been where you are right now.  Have courage.

Fri, 07/01/2011 - 13:00 | 1419365 hamurobby
hamurobby's picture

Exactly how I play and played it, and am down 55% this week in my trading account. I have done this before (last sept) and have come back, I will do it again.

Fri, 07/01/2011 - 10:50 | 1418849 anynonmous
anynonmous's picture

ZH - where's the wall to wall coverage on DSK??  hmmm

Fri, 07/01/2011 - 11:16 | 1418912 topcallingtroll
topcallingtroll's picture

We can read the mainstream media.  They have it covered correctly on this one.

Fri, 07/01/2011 - 10:56 | 1418856 treemagnet
treemagnet's picture

I forgot, what happens again when an overloaded and underpowered plane tries to climb too quickly ignoring all of the warning buzzers and lights?

Fri, 07/01/2011 - 10:53 | 1418857 Temporalist
Temporalist's picture

The Bernank climbs out on the wings and throws out bails of paper?

Fri, 07/01/2011 - 12:13 | 1419175 sleepingbeauty
sleepingbeauty's picture


Fri, 07/01/2011 - 10:55 | 1418861 Bugman82
Bugman82's picture

I don't get how people can go short with the manipulation and level of control that the media, fed, and algos have over the market.  They can literally do anything they want for years as long as earnings don't plumet and fundamentals don't absolutely explode.  Jobs, who cares.  Housing market still failing, who cares.  Companies are still making profits and they can manipulate the rest.

Fri, 07/01/2011 - 10:58 | 1418876 SheepDog-One
SheepDog-One's picture

Screw going short, I'll do far better and keep loading PM's, the real money to their paper and zinc slug 'money coin' worthless nonsense. Screw shorting their manipulated paper, its not the 1980's anymore, you have no chance playing on THEIR tables in THEIR casino!

Fri, 07/01/2011 - 11:05 | 1418886 buzzsaw99
buzzsaw99's picture

it's not even real money, it's that conjured shit, lies, bailing wire and abc gum. why would anyone gamble against the house when they know the place is rigged six ways to sunday?

Fri, 07/01/2011 - 11:17 | 1418913 Absinthe Minded
Absinthe Minded's picture

When SNAP participation hits 100 million they may have to implement a soylent green solution.

Fri, 07/01/2011 - 12:14 | 1419191 SeverinSlade
SeverinSlade's picture

I disagree there.  This party can only last for so long.  Corporations will continue to have massive revenues, but there's already significant pressure on margins and earnings.

As long as more fiat is created, inflation will go up which will cause input prices to go up.  You can only pass on those costs to consumers for so long. 

Besides, Bernanke needs the markets to tank in order to gather full support for QE3.  When the DOW is crashing down towards 10,000 or 9,000, Wall Street AND Washington will on their knees begging for more stimulus.  Then Bernanke will follow DSK's example and skull fuck everyone.


Fri, 07/01/2011 - 10:57 | 1418871 slaughterer
slaughterer's picture

Today's prediction:

Ramp to 1340 for a 20 handle?


Take profits to make an EOD doji?

What sayeth the ZH regulars?

Fri, 07/01/2011 - 11:01 | 1418887 SheepDog-One
SheepDog-One's picture

Im not sure....I dont really care anyway what imaginary stocks will get manipulated to by computer programs I just have to be home to accept this delivery of another 1,000 round case of .308 ammo this morning. Fuck the FED, fuck Bernanke, fuck the govt fuck Geithner fuck the DHS CIA IRS FBI, and fuck the new world order central bankster world criminal cartel most of all.

Fri, 07/01/2011 - 11:03 | 1418879 ssp2s
ssp2s's picture

ECRI down for 10th straight week, annualized rate now clinging to positive territory at 2%, down from 2.9% the week before.

Fri, 07/01/2011 - 11:08 | 1418895 SheepDog-One
SheepDog-One's picture

Who cares? American Idle USA is on the eve of yet another 3 day drunken BBQ fest WHOOO HOOOOO!! Hey, make american morons REALLY happy and close the worthless DOW up 1,000! Who cares?

And the really funny part, its a celebtartion of their 'INDEPENDANCE"! LMAO if irony were gold bars I'd be King Midas bwaaaaa ha ha ha haaaaaa!! Drink till ya puke america, eat till ya shit yourself...whatever!

Fri, 07/01/2011 - 12:08 | 1419170 SeverinSlade
SeverinSlade's picture

Any of you catch Mark Dice interviewing beach goers in San Diego about the significance of July 4th?  Pretty funny.  Almost everyone was completely clueless as to who we declared independence from.

Fri, 07/01/2011 - 11:03 | 1418891 RobotTrader
RobotTrader's picture

LNKD from $64 to $94 in just a few days....

I didn't chase it, but some of my buddies made a huge score there.

Bears were loaded up on that one.

Fri, 07/01/2011 - 11:10 | 1418900 SheepDog-One
SheepDog-One's picture

Tyler, thanks for revoking Robos chart and picture posting privs, well done. Now can you go the extra step and remove this assclowns account entirely? 


Fri, 07/01/2011 - 11:14 | 1418907 topcallingtroll
topcallingtroll's picture

I think it is good to have a few non permabears on the site.

Fri, 07/01/2011 - 11:24 | 1418973 Bob
Bob's picture

Agreed.  Echo chamber=not good.  Besides, he gets back as good as he gives and it's all fun. 

Do we still agree on the elimination of favored tax status for capital gains, troll?

Fri, 07/01/2011 - 11:25 | 1418989 topcallingtroll
topcallingtroll's picture

Sure.  It is economically neutral to tax all earnings the same, whether or not it is earned or unearned.  It is a small way to equalize the tax code since high end people have relatively higher percentages of unearned income.

On a moral level why is the guy who works with his hands taxed at a higher marginal rate than the guy who pushes buttons?

Fri, 07/01/2011 - 11:33 | 1419020 Bob
Bob's picture

I hear ya.  Not to mention the problem of paper money chasing paper assets.  Surprising the things that people even as "different" as us can agree on, ain't it?  Viva diversity. 

Fri, 07/01/2011 - 11:09 | 1418896 RobotTrader
RobotTrader's picture

All I can say is that this is going to be one of the biggest July 4th weekends ever out at The Hamptons.  Stay way from JFK, otherwise you are going to get run over from inbound foreign hookers.


Fri, 07/01/2011 - 11:06 | 1418902 SheepDog-One
SheepDog-One's picture

Please Tyler? 

Fri, 07/01/2011 - 11:19 | 1418959 eurusdog
eurusdog's picture

Because I am relatively new, I searched all over for some validation of Robo's trading record but it is no where to be found! Hmmm

Fri, 07/01/2011 - 12:04 | 1419158 whstlblwr
whstlblwr's picture

Robo seem annoying because comments not actionable, he only state obvious. So its a poking needle instead of help. Robo why not do good and give comments to make money instead of usual NaNaNa.

Management of stock market impressive. If stock Market too big for US to manage fooled me. Now 401K statement for June look good. And if bank no want to buy stock, raise reserve requirement force it.

Fri, 07/01/2011 - 13:13 | 1419411 Bob
Bob's picture

Robotool, you really owe it to yourself and the rest of us to post pics with those comments. 

Fri, 07/01/2011 - 11:15 | 1418909 topcallingtroll
topcallingtroll's picture

Hey sheepdog maybe you should join Leo.  He went all cash in his portfolio right before this next leg up in the stock market.

Fri, 07/01/2011 - 11:18 | 1418919 SheepDog-One
SheepDog-One's picture

'All cash'? Hey go be enamored by imaginary stocks and other worthless pieces of paper all you like, I dont care.

Fri, 07/01/2011 - 11:19 | 1418925 topcallingtroll
topcallingtroll's picture

I suppose all gold and silver is slightly better.  I will give you that!

Fri, 07/01/2011 - 11:17 | 1418943 SheepDog-One
SheepDog-One's picture

Gold and silver is 'slightly better' than what, pieces of paper that dont even actually exist?

Fri, 07/01/2011 - 11:25 | 1418974 topcallingtroll
topcallingtroll's picture



I still think this isn't the best time to be buying gold and silver just yet, but silver is about to hit its 200 dma and I will be a buyer and going long, at least temporarily.  Stocks may have a little bounce here I am trying to catch.

I admit I was stoned last night too!  Might still be feeling the after effects.

Fri, 07/01/2011 - 11:18 | 1418949 foxmuldar
foxmuldar's picture

I repeat, i work in Manufacturing and orders are non-existant. Inventories are stockpiled everywhere. Life is not good in the Manufacturing sector. Don't believe the pump and dumpers lies.

Fri, 07/01/2011 - 11:26 | 1418978 topcallingtroll
topcallingtroll's picture

and this is what we have to really watch carefully.  keep your finger on the sell button.

Fri, 07/01/2011 - 11:27 | 1418981 treemagnet
treemagnet's picture

I'm in the household moving business - lots of people can't move cause they can't sell their houses - lots less traffic cause its shitty everywhere.  I am part of a well known national van line and its getting worse for sure. 

Fri, 07/01/2011 - 11:23 | 1418962 scatterbrains
scatterbrains's picture

This pig is cooked right in here now. As the new moon passes we will roll into a right shoulder affair and straight down into the dog days of August. No more pomo, no more rigged data until they succeed with QE3. I'm not covering my puts, may even add to them.  Strap in bitches.

Fri, 07/01/2011 - 12:04 | 1419144 equity_momo
equity_momo's picture

Time to sack-up for sure.

This week smells like the last hurrah. May get some nice narrow range days early July for the insiders to distribute into.

Fri, 07/01/2011 - 11:20 | 1418966 Robslob
Robslob's picture

I am / was non-believer in Robo's BS but his BS seems to be completely in line with market direction...

I am rational enough to know what he is stating is simple: Right or wrong follow the money and your scraps will turn into big money. I

t pains me to say that Robo is right and everything is fucked but people are making money like it or not.

I am junking myself upon completion of this post.

Fri, 07/01/2011 - 11:31 | 1419001 topcallingtroll
topcallingtroll's picture

By the way I documented going into VDE at 105.5ish. As my most recent call.

The least robo could do is document ahead of time what he is going to do.

I am interested in his real time trades.

Fri, 07/01/2011 - 11:33 | 1419006 eurusdog
eurusdog's picture

After being burned twice now on inventory builds (the last two red spikes lower on Tyler's chart), manufacturers will be looking for more ways to shorten the restock channel. That will include lowering payrolls, putting off equipment purchases, lengthing delivery times, and discounting purchases after the discount time has lapsed. None of this points to an overall recovery in manufacturing. If you are a manufacturer you will know what all this means.

Fri, 07/01/2011 - 11:42 | 1419040 falak pema
Fri, 07/01/2011 - 11:46 | 1419057 monopoly
monopoly's picture

It is amazing how they spin this. Picked up another miner on the dip this morning.

Fri, 07/01/2011 - 20:35 | 1420564 taca
taca's picture

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