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Ugly Economic Data Continues Validating Double Dip: Deterioration In Empire Manufacturing, PPI And NSA Initial Claims
The Empire Manufacturing Index plunged to 5.08 on expectations of 18, and previously at 19.57! The stunning drop was driven by a contraction in virtually all diffusion categories: New Orders (10.13 from 17.53), Shipments (6.31 from 19.67), Unfilled Orders (-15.87 from -1.23), Delivery Time (-7.94 from 9.88), Prices Paid (25.40 from 27.16), Prices Received (-1.59 from 4.94), and Average Employee Workweek (-9.52 from 8.64). Only inventories increased marginally (we may have seen this before), from -1.23 to 6.35. All in all a disaster. Elsewhere the PPI also plunged much more than expected, coming in at -0.5 on expectations of -0.1 as deflation is now pervasive. In all fairness, core PPI came in as expected at 0.1%. Lastly, the Initial Jobless Claims came in at 429,000 from 458,000 the week before, a number made irrelevant after various automakers announced they would continue summer production in autoplants that otherwise get shutdown for the period, thus skewing the seasonal adjustment. Indeed the Non Seasonally Adjusted number for the week surged from 468,492 to 513,347. Perhaps most relevantly for the economy, the collapse in those collecting EUC and extended benefits continues, with both categories coming in lower, at -236,162 and -18,580.
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After scanning the report it seems this survey indicates growing sales overseas, declining sales domestically. This is no surprise. What is a big question for me is will the emerging markets "decouple" a little and maintain steady growth or even flat if the developed economies slow down? What is the percentage of change relatively?
Hehe. Maybe the fifth "decoupling" theory will be the charm.
There is a lot of decoupling going on, but most of it is between reality and what folks think/do/say/believe.
In my residential real estate world, I keep hearing stories of contraction in not only demand but who is willing to lend.
But hey, JPM profit is through the roof today.
I guess after all of our other industries collapse, we can just be a nation of banks, right?
Great question. Probably been asked in every declining empire since before Rome. (Hint - I think the answer is no).
True. Egyptian wheat kept Rome afloat during the decline. Of course they did have slavery back then so they didn't have to pay too promptly.
Ask a Foxconn worker if he/she thinks the situation has improved much....
(wow, sobering thought, time for a drink)
I wonder if that slavery is any different than today's slavery.
Nearly every home in America could potentially be (mis?)construed as a debtor's prison/slave compound.
Right Mephisto...I demand to know exactly the rate of our plunge into -0- production depression so I can Fibonacci plot this bitch and trraaaade it!!
ummm... given the data today.... I'd say -1.
the light at the end of the tunnel is a train coming the other way. Nothing to Fibonnnnaccciii, or whatever, just sell. Sell assets. Short what you can short. Buy volatility. Mr Bravo is currently loading up on VXX, smart rude boy that he is.
Cash, for now, and PMs for later. Dont worry about the price of gold today, it's just Mr Bravo selling, he's just a technician, he buys it back too you know.
Good luck ladies & gentlemen.
Somehow CNBS will spin this as bullish. It'll mean more stimulus to offset the depression. DOW 11K.
Yes: Jobless claims sink to near 2-year low - CNN
that explains it all, unemployment must be approaching 100%
And fewer collecting unemployment. That must be bullish. The fact that they are now destitute doesn't get included in that headline.
Sounds bullish to me. Hey, JPM made money right? Rally day again. Nothing to see here. Best bet is this news will be ignored most all day while the JPM bullsh*t numbers will be highlighted.
Gotta love being able to do mark-to-unicorn. Then all your assets are making money. Why was it illegal for Enron to pull this, but the banks are encourged to?
JP statement and dividend news is key. Dimon wants 'more certainty' before reinstating it. Ie he wants a better economy, can see its not coming soon. Statement last quarter was so bullish its as if Obama wrote it, this time not a word on the economy at all.
I think JP have their protective headgear on, recession coming.
Yes, JPM "made money" by moving funds from reserves to "earnings". What a joke.
Good Call....NOOOOOTTTTTT
As firstdivision said on the Baltic thread, NSA would have been worse had GM not kept its staffing up through normal furlough period. Change you can believe in.....
had GM not kept its staffing up through normal furlough period.
...they get by with a little help from their friends
Yeesh....over 500,000 new people out of a job. 254,742 lost their emergency/ext. benefits....they are gone from the count and have no monetary support (except food stamps and welfare). There is nothing positive here.
The positive is that this should be good for another 1% in equities today. Quit "rationalizing" the down side of this den of vipers and do a cannon ball in. BUY BUY BUY!
But this is positive! You see, since they are not working, they do not pay taxes. Obama's tax cut for the middle class in action!
The difference between Welfare Assistance and Unemployment Assistance is in name only. Perhaps the extended unemployment being debated in Congress should be called "Welfare".
I know this doesn't apply to everyone, but there are a lot of people out there collecting unemployment who refuse to take a job based on commission or sales. They are looking to replace the fat salary that contributed to them losing their job in the first place and are content to collect "Unemployment" until forced to face reality. I know because I've interviewed several of them myself and offered some jobs only to be turned down. So there are jobs out there but they aren't as plush as what they are used to.
... the Initial Jobless Claims came in at 429,000 from 458,000 the week before... the Non Seasonally Adjusted number for the week surged from 468,492 to 513,347.
The Bureau of Making Shit Up strikes again.
Double-plus-good, citizen.
...and continuing claims up 247K. Maybe the right figure to be tracking here is "Continuous Employment Claims".
I always thought that BLS stood for
Bullshit Lies and Stories .
We all know that jobless would have been much higher had the government not kept those GM plants open (I would wager output was drastically reduced), and the retention of census workers longer than needed. So by August are we going to be looking at 500K/week jobless claims again?
looking at the non seasonally adjusted, we are over 500K and will continue to be there. states began laying off employees on July 5.
Well by 500k, I was refering to the "seasonally adjusted(mark-to-unicorn)" and not the real number. Sorry, I should have been clearer on that respect. Now that you mention it, the real number will be somewhere upwards of 700K starting next month. Times are getting fun.
There was a funny similarity in India early this week (or late last week). India's equivalent is called the IIP (Index of Industrial Production) numbers. Basically tracking Manufacturing. "IIP for May 2010 was at 11.5% (y-o-y). It was much lower than market expectations of around 16% (various newswire agencies). The figure for April was revised lower from 17.6% to 16.5%. " And on that day, the market gained 300-400-points. So, looks like we are all de-coupled.... from common sense. ORI http://aadivaahan.wordpress.com
Empire number not even mentioned on Bloomberg TV. If they don't talk about it it didn't happen, right?
Tom Keene brought it up on Surveillance.
Nobody wants to cross The Big Combo. They tread lightly over the bad news, unless it goes nuclear and they'd look too stupid if they ignore it
Sure is a sign of a collapsing economy that the auto manufacturers did not shut their plants for the usual summer furlough.
And the strong decline in energy prices to get that ppi number is really really bearish for economy. $150 crude would be soooo much better for everyone.
Baaaah....
Sure is a sign of a surging economy that the government-owned auto manufacturers canceled their usual summer furlough for what seems to be entirely political reasons - and that in spite of that little exercise in market manipulation non-seasonally-adjusted initial claims were still off the charts.
Baaaah....
I've worked in automotive for 16 years and can't recall them ever cancelling it across the board.
Must be a eerie coincidence.
Seems almost, unprecedented. No?
Yeah...election year ya know
Just like in the old days of the USSR, keeping people employed making shit for which there is no demand because everyone is broke.
Cash for clunkers part deux?
Do you think that it was also for entirely political reasons that the monster online job index hit new recovery highs for june, in both the US and Europe?
Do you also think it is a good time to short the market when the most read story on MarketWatch is 'The Stock Rally is Meaningless' and number three is 'Don't be fooled by another breakout'. Or the interesting survey from Merrill Lynch which found institutional equity sentiment on par with early 2009?
Baaaaaah
Wow - struck a nerve, did I? Sheesh, thicken your skin under all that wool, sheep.
The "monster online job index"? Not for nothing, but WTF is the "monster online job index"?
And who said anything about "shorting" anything?
Baaaaaah
No nerves at all. Skin is just fine. Thanks. I believe they are the largest of the online job search sites. They compile a 'help wanted' index in the US and EU. Not sure if they do other places.
The indicies are available on their website.
Obviously don't know your market position. Most hear seem to be short.
I am a fully invested long.
Monster Worldwide, Inc. (NYSE: MWW) is the parent company of Monster.com, the premier global online employment solution for people seeking jobs and the employers who need great people. We've been doing this for over ten years, and have expanded from our roots as a "job board" to a global provider of a full array of job seeking, career management, recruitment and talent management products and services.
Collapsing economy?
Car sales are GANGBUSTERS!...........oh wait
Let us pray that the Federal Reserve will stay out of our markets. For we all know that there meddling only causes more pain for the average person.
in a perverse way, the stock market will likely rally anticipating Jim Grant's call for a QE2.
How come I don't here more about these numbers on Squawk Box? Wait, I feel a thought coming on, hold on a second. I don't know what it means but here it is:
Joe Kernen is the kindest, bravest, warmest, most wonderful human being I've ever known in my life.
I'm not feeling well this morning, I'm going to go lie down.....
Have a couple of drinks, too. It's coctail hour somewhere.
Edit double post.
Aaaargh.
The media might as well give up trying to shape public opinion, thay have failed us one to many time over the past decade.
What is a big question for me is will the emerging markets "decouple" a little and maintain steady growth or even flat if the developed economies slow down?
I dont have much hope in INDIA....the main factor of our economic growth is the IT sector......and that is dependant on USA(80%) and Europe........i just dont get it...
we simply donot have that Domestic growth .....nor that sophistication ....to continue at this level....this totally looks unsustainable to me ....this bubble can already be seen in the "Higher Education sector"......i have friends who were earning 22 thousand a month...
they left the Job....did an MBA course for 2 years costing atleast 700000 rupees...(LOANS)......and now most of them cant find a decent job or cant even find one JOB....
those who landed jobs got much lower than their previous earnings,.....
Interesting information. I would think India would be scrambling to create the domestic consumer as quickly as possible...of course that would require a rise in wages.
rise in wage....where would it come from ...i even have doubt that this crash will leave many people unemployed.........we are not doing things which needs to be , say ...a former America.........heres how things are.....lets take an example..a retail company...7/11..outsources its IT operations to india.......they have their daily billing operations...their suppy chain management etc etc ...and that employs a lot of people in India....but suppose 7/11 scales down in a BIG way(which i think it will do)....those jobs are gone.......
i dont believe an indian retail company will spend same amount ....so i dont know where the Jobs will be coming from......let alone high wages....
Spot on Tense Indian. I see the same scenario you see.
Here is what I wrote about India 2 days ago, if of interest to anyone. regarding India.
http://aadivaahan.wordpress.com/2010/07/13/whither-india/
ORI
http://aadivaahan.wordpress.com
Ooops. And here all this time I thought you guys were woo-woo Indians.
Sorry 'bout that. American-centric views are stifling, eh?
You can't judge a book by.....etc!
;-)
So, what's a woo woo Indian like Rocky? As in defining characteristics?
ORI
http://aadivaahan.wordpress.com
You know. When the Indians attack the wagon train they yell, "Woo-woo!!", and wave their bows and arrows around. Then the cavalry arrives and the Indians yell, "Woo-woo", as they ride away on their pintos. I saw it in the movies.
My sympathies. India will have it's day. But I agree for the here and now, every decoupling theory has been disproven. Why? First, global banks and central banks are too interconnected. Particularly USA and Eurozone. Their fortunes rise and fall together as a result of past policies. It's a big factor. Then, regrettably, there's also the issue of overcapacity in virtually all manufacturing.
I had high hopes for India, and, then, I started digging around for more information. What I have found is hardly encouraging. And, now, everyday, I get bits and pieces of information that is solidifying my doubt. If US collapses, India is toast, in my opinion.
http://economictimes.indiatimes.com/news/economy/indicators/55-of-Indias-population-poor-Report/articleshow/6170107.cms
http://www.domain-b.com/economy/general/20100715_inflation_rate.html
http://economictimes.indiatimes.com/Indicators//articleshow/6159095.cms
But, the good news is that the INR has a new symbol. That should fix all the problems. Now, I am feeling much better!
http://economictimes.indiatimes.com/news/economy/policy/Rupee-to-have-a-distinct-symbol/articleshow/6171923.cms
India has the same structural problem that China and other high-population countries do - namely that in this increasingly automated world there are simply not enough jobs for the population. IT is not going to do it. Manufacturing is not going to do it. Seriously, the only way to employ the hundreds of millions of Chinese and Indians who will need jobs is to send them back to the farms.
Back to the farms would be great for everyone.
Only, everyone is so aspirationalized by TV that everyone is drawn to the city.
Then everyone looks for work.
Everyone, we're in a Toxic spiral!
ORI
http://aadivaahan.wordpress.com
Gimme a D, gimme an E, gimme an F, gimme an L . . . .
Exactly.
Some historical perspective. Comparable week UE totals for the last 4 years:
Year NSA SA
2010 513,347 429,000
2009 671,242 538,000
2008 476,071 385,000
2007 383,839 318,000
Source: http://workforcesecurity.doleta.gov/unemploy/claims.asp
More importantly, those still working(June):
Year NSA
2010 130,470,000
2009 130,640,000
2008 137,285,000
2007 137,706,000
Why do I get the feeling that Obama will have an impromtu speech on this sometime mid-day?
Lost decade: The new threat to the US economy.
http://money.cnn.com/2010/07/15/news/economy/lost_decade/index.htm
Now that there's an iApp for manufacturing, are these 19th century thingies really important?
http://www.nytimes.com/2010/07/15/us/politics/15lobby.html
Industrial Production came in miserable 0.1% down from 1.3%. Guess those iPads get made in China...oh yeah.
Rally on baby. Fed will "rescue" us all!!!
Fuck all these Havard preppie indexes and indicators. There is only one indicator that matters. It's called the Apple index. With all the ipads, IPhones and MacBook pros being sold, The Apple index is 95. The world is good. Rally on GZ
As warned about for some time... EURUSD daily chart is bullish.
http://stockmarket618.wordpress.com/about
There has to be a "Green Shoot" in there somewhere, BUY,BUY,BUY!
Question for ZH; How can EUC = -236,162 when EUC was cancelled?
From what I understand all tiers require legislative action. No benefits where paid the week ending June 26???
Mark Beck
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