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Philadelphia Fed Massive Miss: Comes At 18.5 On Expectations of 36.9, Downward Q2 GDP Revisions Can Now Commence

Tyler Durden's picture


And here comes the first indicator that Q2 GDP is about to be mass revised by everyone, courtesy of Japan, and ongoing inflation pressures: the Philadelphia Fed collapsed from a revised 43.4 (a 27 year high) to 18.5, the lowest since November 2010. And here is why even the Philly Fed admits "indicators suggest slower growth" - "The survey’s broadest measure of manufacturing conditions, the diffusion index of current activity, decreased from 43.4 in March to 18.5 this month (see Chart). The demand for manufactured goods, as measured by the current new orders index, showed a  similar slowing: The index fell 22 points, following seven consecutive months of increase. The shipments index declined 6 points  and remained at a relatively high level....A majority of firms continue to cite price pressures, and a significant share of firms reported higher prices for their own manufactured goods again this month." Translation: Wall Street Q2 GDP revisions coming en masse: the podium is yours Jan Hatzius.

Alas, as companies are only starting to recall, inflation is sticky and takes far more than 15 minutes to fix:

Firms Report Higher Output Prices

Firms continue to report price increases for inputs as well as their own manufactured goods. The prices paid index declined 7 points this month but remains about 45 points higher than readings just seven months ago. Fifty?nine percent of the firms reported higher prices for inputs this month, compared to 64 percent last month. On balance, firms also reported an increase in prices for their own manufactured goods: The prices received index increased 5 points and has steadily increased over the last eight months. Thirty percent of firms reported higher prices for their own goods this month; just 3 percent reported price reductions.

Looking at the index components, New Orders, Shipments and Inventories tumble

Full report


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Thu, 04/21/2011 - 10:09 | 1192164 slow_roast
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Thu, 04/21/2011 - 10:18 | 1192189 bonddude
bonddude's picture

looks like the morgue just dropped dead !

Thu, 04/21/2011 - 10:37 | 1192245 Sancho Ponzi
Sancho Ponzi's picture

Soylent green shoots

Thu, 04/21/2011 - 10:12 | 1192165 I am Jobe
I am Jobe's picture

Eat IPAD Bitchez

Thu, 04/21/2011 - 10:47 | 1192281 sbenard
sbenard's picture

LOL! It gets stuck between my teeth! :)

Thanks for a good chuckle. I needed that!

Thu, 04/21/2011 - 10:10 | 1192167 NoBull1994
NoBull1994's picture

awesome.  more QE.

Thu, 04/21/2011 - 10:18 | 1192197 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Quantitative Easing 4 ever.

Thu, 04/21/2011 - 10:34 | 1192234 Overflow-admin
Overflow-admin's picture

= Duke Nukem Forever release date = june 14th.

Thu, 04/21/2011 - 10:51 | 1192288 sbenard
sbenard's picture

More dollar devastation from "Bubbles" Bernanke!

Thu, 04/21/2011 - 10:13 | 1192168 RobotTrader
RobotTrader's picture

And COF is at 52-week highs today....


Never underestimate the consumer.

Thu, 04/21/2011 - 10:15 | 1192175 Hephasteus
Hephasteus's picture

So you finally finish puking all over your monitor?

Thu, 04/21/2011 - 10:25 | 1192204 redpill
redpill's picture

Did your image privelages get revoked or can you not bring yourself to even do it today? Yahoo chart reflects it never hit the February levels but whatever.

Regardless, here's a tip: People being forced to carry a balance on their credit cards so they can buy food is not positive for economic fundamentals.

Thu, 04/21/2011 - 10:38 | 1192238 Careless Whisper
Careless Whisper's picture

word of the day: wtf? as in; TZOO wtf?

Thu, 04/21/2011 - 12:23 | 1192660 Imminent Crucible
Imminent Crucible's picture

There's something very fishy in Capital One's report. Revenue and net interest income still well off YoY, but profit is way up on reduced charge-offs. Considering that COF does not charge off an account until it's at least 180 days delinquent, you have to ask yourself if this is the result of last fall's surge in "Whaddya know? We don't have to make our mortgage payment 'cause of this MERS thing. Let's go to the mall!"

Thu, 04/21/2011 - 10:50 | 1192284 John Law Lives
John Law Lives's picture

Why does ZH give you posting privileges?

What value do they think you add here?

Thu, 04/21/2011 - 10:48 | 1192287 Bill the Cat
Bill the Cat's picture


Thu, 04/21/2011 - 10:11 | 1192169 DutchTreat
DutchTreat's picture

Its got QE3 written all over it.

Thu, 04/21/2011 - 10:33 | 1192224 Cassandra Syndrome
Cassandra Syndrome's picture



Thu, 04/21/2011 - 10:39 | 1192243 Overflow-admin
Overflow-admin's picture

Loop while 1=1

Thu, 04/21/2011 - 11:22 | 1192444 A Man without Q...
A Man without Qualities's picture

QE3 won't help them I am afraid.  The plan to raise equity prices has fed though to commodity prices.  Manufacturing has been driving full steam ahead, concerned about rising input prices but hoping they can pass this on to the consumer.  Consumer has been saying, we are getting squeezed going to have to pull back, but the markets prefer to ignore this background noise.

Here we are.  The greatest failure of this form of stimulus is there was no transmission mechanism to the wider economy (neither jobs nor wages) and we were due to encounter a stagflationary quagmire sooner or later.  

I am sure JM Keynes said the key was about stimulating the economy through the income of the working man....

Thu, 04/21/2011 - 10:14 | 1192171 Quinvarius
Quinvarius's picture

Bricked it.

Thu, 04/21/2011 - 10:15 | 1192173 Dick Darlington
Dick Darlington's picture

But but but, Bloomberg CONsumer comfort (looooool!!!) creeps higher. You just can't make this shit up!

Thu, 04/21/2011 - 10:13 | 1192174 d00daa
d00daa's picture


Thu, 04/21/2011 - 10:18 | 1192177 scratch_and_sniff
scratch_and_sniff's picture

ok so now $ rally, yeah???? WTF!!! HA HA how i laugh, now everyone that pumped the euro and sold the dollar have to buy it for genuine reasons and they shit themselves and sell, this is a joke.

Thu, 04/21/2011 - 10:16 | 1192178 bingaling
bingaling's picture

Cover Ass Index will be in full force as the only green rockets will be in commodities .

Thu, 04/21/2011 - 12:31 | 1192727 The Profit Prophet
The Profit Prophet's picture

And silly me thought the reason for the FED desperation world market pump yesterday was to cover for an AAPL turns out to be a Philly Fed collapse!

T.E.I.N. everyone! 

Thu, 04/21/2011 - 10:15 | 1192184 RobotTrader
RobotTrader's picture

JPM still the strongest bank stock out there.  Still over $44.

Thu, 04/21/2011 - 10:27 | 1192217 redpill
redpill's picture

Your RobotTrader brain never figured the mighty JPM stock would be looking up at the silver spot price, did it.

Thu, 04/21/2011 - 10:33 | 1192232 gordengeko
gordengeko's picture

Fuck off, BAC is up JPM is down.  Noone believes your shit.

Thu, 04/21/2011 - 12:35 | 1192742 The Profit Prophet
The Profit Prophet's picture

Please don't feed the's best just to junk the comments into oblivian....I hear it takes 50 junks.

T.E.I.N. everyone!

Thu, 04/21/2011 - 10:51 | 1192290 Bill the Cat
Bill the Cat's picture


Thu, 04/21/2011 - 11:45 | 1192539 d00daa
d00daa's picture

Do you own it?  If not, this is a great place to buy.

Thu, 04/21/2011 - 10:16 | 1192186 Seasmoke
Seasmoke's picture

it must have snowed ........somewhere !

Thu, 04/21/2011 - 11:05 | 1192353 shushup
shushup's picture


Thu, 04/21/2011 - 11:20 | 1192433 Careless Whisper
Careless Whisper's picture

nice avatar. been hittin the gym lately?

Thu, 04/21/2011 - 10:19 | 1192205 firstdivision
firstdivision's picture

The housing price index was another miss.  The beauty is the revision from the prior week.

Thu, 04/21/2011 - 10:20 | 1192206 RobotTrader
RobotTrader's picture

YUM Brands up 5%, 3-year high for that stock.

3 years after the biggest investment banking implosion in history, and restaurant stocks are busting out to new highs???   Yep.

Thu, 04/21/2011 - 10:42 | 1192242 Rogerwilco
Rogerwilco's picture

Classic crack-up boom underway. The economy today reminds me of a Chinese acrobat troop we saw last year. They end their performance with a stage full of contortionists balancing dozens of spinning plates. Not a single plate fell...Luck? Skill?

Thu, 04/21/2011 - 10:55 | 1192310 Spastica Rex
Spastica Rex's picture


Thu, 04/21/2011 - 11:05 | 1192373 lieutenantjohnchard
lieutenantjohnchard's picture

still changing the subject to avoid looking at his stagnant, stuck in the mud portfoilio of widows and orphans stocks going nowhere slowly.

here's a tip for your living vicariously, green with hampton envy of the success of other investors: get a silver quote and imagine where you would be if you could connect dots.

Thu, 04/21/2011 - 11:25 | 1192446 Careless Whisper
Careless Whisper's picture

restaurant stocks are busting out to new highs???   Yep.

u may want to check ur CMG holdings. not having a good morning.

Thu, 04/21/2011 - 11:45 | 1192561 d00daa
d00daa's picture

"The market isn't pricing in QE3.  The market is pricing in an economic boom, led by the US Consumer."  -RobotTrader

Thu, 04/21/2011 - 10:27 | 1192210 A Nanny Moose
A Nanny Moose's picture

That's gonna leave a mark.

Thu, 04/21/2011 - 10:28 | 1192213 holdbuysell
holdbuysell's picture

And to think we haven't even seen what's coming with states and their fiscal budgets. Many states budgets need to be set for July 1, including CA.

That gasoline should begin falling on the fire very soon.

Thu, 04/21/2011 - 10:31 | 1192220 alien-IQ
alien-IQ's picture

Big Miss = QE 3 certain = Market rallies/Dollar tanks.

Big Beat = Economy doing great = Market rallies/Dollar tanks.

On Target = Everything is stable = Market rallies/Dollar tanks.

...and the worms ate into his brain...

Thu, 04/21/2011 - 10:55 | 1192311 Spastica Rex
Spastica Rex's picture

+1 Pink Floyd

Thu, 04/21/2011 - 11:06 | 1192360 shushup
shushup's picture

Makes no scense but you are correct.

Thu, 04/21/2011 - 10:33 | 1192222 alfred b.
alfred b.'s picture


    Who else thinks the dyi & ag have a date @ 68 ??

Mon, 04/25/2011 - 20:27 | 1206046 thames222
thames222's picture

Me!  I think the date might be set at 70, though.  I'm holding until the cows come in, ag and au.

Thu, 04/21/2011 - 10:37 | 1192244 Rusty Shorts
Thu, 04/21/2011 - 10:41 | 1192251 docj
docj's picture

Winning the Future, right?

Better hope so, because we're crapping ourselves in the present.

Thu, 04/21/2011 - 10:46 | 1192271 Rusty Shorts
Rusty Shorts's picture

Pants >>>>>>>>>>>>> totally filled.

Mon, 04/25/2011 - 20:30 | 1206064 thames222
thames222's picture

losing our future...see Ruppert's link below, his documentary "Collapse" spells it all out.  no one listens, though, it's sad how we're going to end up.

Thu, 04/21/2011 - 10:41 | 1192254 Rusty Shorts
Rusty Shorts's picture

Michael Ruppert - We Have Until July at the Latest Before Economic Collapse Begins

Thu, 04/21/2011 - 11:05 | 1192370 long juan silver
long juan silver's picture

what a fruit

Mon, 04/25/2011 - 20:31 | 1206074 thames222
thames222's picture

Ruppert speak--any time that guy opens his mouth, i'm listening.  He's a goon, and he knows how shit works better than anyone else around.

Thu, 04/21/2011 - 10:42 | 1192264 sbenard
sbenard's picture

Wow! Now that's really a massive miss!

Shhh! Don't tell Wall Street! They don't get it yet!

Thu, 04/21/2011 - 10:50 | 1192295 Tracerfan
Tracerfan's picture

QE3 is coming Bitchez.  Get ready!

Thu, 04/21/2011 - 12:46 | 1192796 The Profit Prophet
The Profit Prophet's picture

In actual fact, it will be called a QE2 extension (with quantum to be detemined on a month-to-month basis, depending on economic conditions.)  Keeping the ponzi afloat and the masses in check is all about confusion and word-play.

T.E.I.N. everyone!

Thu, 04/21/2011 - 10:52 | 1192299 alfred b.
alfred b.'s picture


   usa= QE buffet table.....expect to pay more for wheelbarrows!

Thu, 04/21/2011 - 10:51 | 1192303 SilverRhino
SilverRhino's picture

And silver goes POP.  

No QEIII ... it's about as likely as no thunderstorms in Texas during spring. 

Thu, 04/21/2011 - 10:55 | 1192320 redpill
redpill's picture

We may be running out consolidations before the moonshot.

Honestly a 5% correction/consolidation would make me feel better here!

Thu, 04/21/2011 - 10:59 | 1192327 americanspirit
americanspirit's picture

Here are Japanese supply line disruptions at work - lots of small tech companies in the Philly Fed territory ( Russell 2000 companies) and they are not getting the parts they need from Japan. Even if they are finding substitutes, the prices are higher and the quality generally lower.

Thu, 04/21/2011 - 11:04 | 1192347 haskelslocal
haskelslocal's picture

Top Story in WSJ - World Spurs Manufacturing Growth. Says that manufacturing is up do to world participating in purchases. Yet the writers are so bad (or so pathetically edited) that the second paragraph contradicts the entire article by announcing that manufacturing growth is 4x consumer purchasing growth. Hmmm. Does that mean bloated inventories? A feel good story meant to confuse because it's BULLSHIT?

Thanks PhillyFed for doing your job and playing down the article just as planned.

Thu, 04/21/2011 - 11:02 | 1192348 virgilcaine
virgilcaine's picture

miss it Noonan.. miss it.

Thu, 04/21/2011 - 11:06 | 1192364 redpill
redpill's picture

I guess you don't want that scholarship, do you Danny

Thu, 04/21/2011 - 12:32 | 1192732 Cpl Hicks
Cpl Hicks's picture

Hey, it looks good on you!

Thu, 04/21/2011 - 14:24 | 1193233 takinthehighway
takinthehighway's picture

Five bucks says the Smailes kid picks his nose!

Thu, 04/21/2011 - 11:02 | 1192350 long juan silver
long juan silver's picture

No shit. US companies are making their manufactured goods anywhere but in America and as a result are making bank. That's why Mr Market gives a rat's about Philly Fed cheese dogs.

Thu, 04/21/2011 - 11:24 | 1192442 dogismyth
dogismyth's picture


Does anyone have a clue?  Does anyone know what the fuck is going on?

Those are rhetorical questions.  The obvious answer is...not just NO...but FUCK NO!!!

Face're all screwed one way or another. 

Its doesn't matter how many bricks of gold you're sitting on or how much FRNs you have to wipe your ass.

You gameplayers remind me of a bunch of drunks camping having a good ole time, while a major forest fire is surrounding you and blazing your way.  You'll be too punch happy to do a goddamn thing.

Yes...I do have visions on a regular basis.

Panic is about to be redefined.


Thu, 04/21/2011 - 11:35 | 1192498 slewie the pi-rat
slewie the pi-rat's picture jan hatzius steps to the podium:  "These filly and Texas mare local FED opinion polls can show high random variance.  However, as my criminal enterprise has already been an early harbinger of possible reverse vector technology, let me agree with Tyler:  we are fuked!"

Thu, 04/21/2011 - 11:45 | 1192543 island
island's picture

I agree.  Bernokio should be clear by now that his QE efforts have done virtually nothing for the real economy (as opposed to the phantom financial economy).  More QE will only result in the same outcomes - in particular, more speculation in commodities, pushing prices higher and continuing downward pressure on the real economy and thus the housing market as well.  Given the holdings of the Fed, I have a hard time believing they can't see that more QE will undermine their own wealth.  And they'd have to be delusional to believe more QE will result in a strengthened real economy.

It is time to clear out the debt, claw back all the Wall Street bonuses, raise the taxes on the richest, eliminate the Social Security tax cap, let housing prices decline to affordable levels, get the budget in line with revenue, and let the economic wounds heal.

However, I'm fairly certain what we will get is further economic destruction in order to feed the uber-rich their accustomed gargantuan portions of the pie.





Thu, 04/21/2011 - 11:43 | 1192551 Yardfarmer
Yardfarmer's picture

with the supply lines of the world's #3 economy fatally disrupted we could be reaching end game. now that the BOJ is the new ATM of the Fed and a net seller of T-bills, QE3 can be strategically withdrawn. we already have defacto global FXQE. QE has now been exported world-wide along with inflation. USD has already been dumped. beware the ides of June. as Ruppert says, earnings will kill everything. 

Thu, 04/21/2011 - 11:56 | 1192602 jvota
jvota's picture

Hat tip to Shirley Bassey and Diamonds are Forever


Silver is forever,

It is what I need to please me,

Disintermediate, then feed me,

It can beat any fight,

I've no fear that it might desert me.



Silver is forever,

Hold it up and then caress it,

Touch it, feel it and assess it,

I can see every part

Neither short, fit nor start, can hurt me.


Paper is bad,

What good will paper do me?

Bullion never lies to me,

When paper's gone

It lusters on.


Silver is forever,

Like this ring around my finger,

Unlike paper, coins will linger;

Paper is for those who

Are not worth going to your grave for.


Silver is forever, forever, forever.

Silver is forever, forever, forever.

Forever and ever.

Thu, 04/21/2011 - 12:00 | 1192610 slewie the pi-rat
slewie the pi-rat's picture

Another Reason For QE 3?

this is pasted from adrian ash's moring tilt:  Shift to Physical Accelerates as Gold Rises in Dollars Only, Silver Adds 7.7% for the Week - Buy Gold Online with the Bullion Vault -

The International Monetary Fund said yesterday that the global banking sector faces a "wall of maturing debt" totaling $3.6 trillion in the next two years.

the formerly-solvent global banking sector needs $3.6 Tril.?  we'd better start wink-winkin right now!  the banksters will hafta run the fraud flea-flicker just to try to sell the bonds.  however, the FED may just decide the US should guarantee bank debt, too, like Fanny & Freddy.  oh wait!  the states come first? 

well, we have this invention, called the printing press, and...

Thu, 04/21/2011 - 12:01 | 1192615 topcallingtroll
topcallingtroll's picture

Dammit tyler.

Your core inflation horse.may be starting to run a good race against my real gdp horse but the race aint over yet.

Thu, 04/21/2011 - 12:24 | 1192690 slewie the pi-rat
slewie the pi-rat's picture

+++  LOL!  then why has the GDP horse stopped?

Mon, 04/25/2011 - 20:24 | 1206042 tomster0126
tomster0126's picture

My relatives in Philly are tripping out...the city is kind of in a bad place because the buildings and infrastructure is so old it's literally crumbling.  the Philly Fed, sounds like a disgustingly good pesto cheesesteak sandwich.

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