Durable Goods Orders Cliff-Dive Most Since Jan 2009 But Initial Claims Beat

Tyler Durden's picture

Durable Goods orders expectations were pushed down to a dramatically low -5.0% after last month's dismal reading and the PMI data since but the print at -13.2% is mind-blowingly bad. Perhaps this is the sneak peek that Ben had? This drop is the largest since January 2009 when world trade had fallen off a cliff. It appears the seasonal-adjustments are the driver of the plunge as NSA is -7.2% (still very weak for August). We are sure there will be calls for the V-Shaped recovery from this but with a very different stimulus-environment around the world (i.e. jaded and soaked in much more debt), we suspect that will be less than forthcoming. The sub-indices were all weaker than expected but we note that defense -40% and non-defense aircraft orders plunged. On the bright side, all this terrible production data inspired less layoffs as Initial claims beat expectations modestly falling to its lowest (best) in two months - sigh.

Durable Goods Orders...


Somewhat surprisingly, it would appear that non-defense aircraft orders fell 101.8% (yes more than 100%) which we are unclear on - it seems some 'returns' were in order as perhaps an airline or two over-spent on their credit card?


Seasonal-adjustments impacted the headline figure but the NSA data is just as bad - with the first YoY drop in Durable Goods NSA since Dec 09...


Initial claims...


of course the prior month was revised up to improve the optics as the dog-and-pony show of the Initial claims data statistics department rolls on...


(h/t @Not_Jim_Cramer)

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Ruffcut's picture

Recovery, bitchezz

"I'm not sick, but I'm not well."

GetZeeGold's picture



Just relax and wait for the revisions.....it could be worse.


Dead Canary's picture

Dood, I always wait for the revisions. Then I knock another 10% off that. And then I call that a conservative estimate.

An enigma, wrapped in an X-file, deep fried in a conspiracy theory.

Glass Steagall's picture

it would appear that non-defense aircraft orders fell 101.8% (yes more than 100%) 

This is very telling since I work for one of the biggest supplier/manufactures to the airline industry and they are bragging about HUGE new orders all the way through 2016. Possibly defense aircraft orders? Idk

slaughterer's picture

ES down a whole 2 points on devastatingly, horrible news.  

Central planning controlling overnight futures from the NYFED.

Market is still living in the same dream or matrix as for the last 4 years.

Bullish, sigh.

GaryNeville's picture

I feel your frustration @slaughterer..........

The printing press circus continues - naw China - apparenty?


lolmao500's picture

Yeah if anyone believes initial claims... they also believe Obama or Romney... which makes them retarded.

spine001's picture

No president since Theodore Roosevelt and perhaps before him has EVER told the TRUTH about what was going on at the time, only what they thought would make them look better in the eyes of the public and allow them to manage the situation. This is pristine clear in historic documents. Perhaps one of the best and most readable and entertaining books is Conquerors, where they tell the story of how the USA decided to distribute the spoils of Germany after WWII. The author refused to finish the book until the last secret documents were released (yes, of course through a freedom of information lawsuit he had to make). After you read this book, you will be able to understand what they are doing to all of us today just by extrapolation. You will also understand that the only thing that is new, is that a lot more people know about it than before where most people believed them. Now many (and growing) do not!

Until next time,

Seorse Gorog from that Quantum Entanglement Fund. alright_.-'s picture

So this is bullish for the markets on hopes of QEternity2?

overmedicatedundersexed's picture

1st qtr GDP revised ...you guessed it  DOWN

JPM Hater001's picture

In fairness eventually claims will fall to zero.

But that will only be because there is no one left to lay off.

spine001's picture

You are completely correct, claims have an exponential (negative exponent) asymptotic behavior down. After 4 years of falling employment (relative to demographic growth, which is the only economically important number), claims are stabilizing at the minimum required to support the basic functions of the economy. Any job lost now in relationship to demographic growth is a job that is coming from the basic services that support our Country. The 99% in the USA are slowly moving down, and that is the main source of inequality growing. The 1% are part of the decision making process that is allowing this to happen and they are doing this because the alternative is worse, WWIII. The wager is that they will be able to stay in the 1% despite the 99% sinking. Mathematical analysis of this game theory model predicts that 99% of the 1% will be crushed by the forces they are unleashing. The most likely outcome being that only the 0.1% will stay where they are economically speaking.

Until next time,

lizzy36's picture

Durable goods lowest since january 2009.

So QE1 and QE2 worker fanfuckingtastic.

Best to go all in now and triple down on the success of the first two programs.

Monetary policy in the US is the equivalent of bringing a knife to a RPG fight.

RSBriggs's picture

No, it's more like bringnig scuba gear to a baseball game...  Money used to jack up bank bonuses doesn't filter down to the "little people", unless the bankers start leaving large tips as they're dining on caviar and Dom Perignon.

Cursive's picture



I know that you know, but will only add that QE is for the bankers (FIRE industry), not the economy and certainly not Joe Public.

pelican's picture

You should see all those beutiful new beach front homes that are being built.  Sure, the old houses were nice, put too small for the banking class.

RSloane's picture

Sadly, that is exactly what the Fed is going to do.

doomandbloom's picture

Transitory....remain calm...carry on...

caimen garou's picture

election chart painting bitchez!

papaswamp's picture

With people out of benifits... They have to subsidize their food stamps with something to pay for gas and rent. Low wage jobs and part time are all that is left.

Antifaschistische's picture

repeat.....when no one has a job, initial claims will be 0

Cursive's picture

Not a new thought, but why would claims stay elevated if the workforce participation rate has fallen significantly.  The pool of worker is smaller than 4 years ago and getting smaller every day.

Antifaschistische's picture

just a hypothesis Cursive..

what if the rate of disemployment is accelerating relative to the total employment pool.  We look at claim on a historical basis when it should be viewed as a ratio of population, ratio of total currently employed, etc.  And it should be weighted in some fashion (e.g. initial claim for someone losing a part time $8.50 per/hour job should not be equal to the initial claim for a full-time $35.00 per/hour worker)

I'd also like to see the "last years W2 NI" figures for all initial claim claimants to see how that is evolving with time.

spine001's picture

You are completely correct, but they don't want us to see those figures or analysis, they are reserved for the FOMC, that is why historically the best way to predict has been to follow the FOMC actions.
From what they are doing, and knowing that they KNOW that they are increasing the risk is financial instability (and for those who don't know what it means, I'll put in simple terms, it means worldwide chaos and may be WWIII), something that Ben Bernanke himself told the Senate and Chamber of Representatives in his last visits, it can only mean that things can't be worse...

Until next time,

RSBriggs's picture

Exactly correct - if the "total employed" pool is shrinking but the unemployment claims remain constant, that means that layoff are accelerating.  If you graph this, you'd see that the unemployment rate is accelerating almost exponentially.  (Graph the decrease in the labor pool....)

Meesohaawnee's picture

and for the millionth time. data means nothing.

Antifaschistische's picture

and data means everything...but for data to be valuable it must be,


  • timely
  • accurate
  • organized
  • relevant

The "street" doesn't get any of this, because insiders get this data leaving us with delayed, sloopy, disorganized and irrelevant data.

LongSoupLine's picture

futures ramping...no retail, no market, no logic.

GetZeeGold's picture



....a market even Mongo can play.


orangedrinkandchips's picture

Man(BEN) looks in the abyss, there's nothing staring back at him. At that moment, man finds his character. And that is what keeps him out of the abyss.


Wall street......1987

insanelysane's picture

Chicago teachers going back to work didn't affect the number?

RSBriggs's picture

They weren't off work long enough to start claiming benefits in the first place.

rsnoble's picture

Maybe the whole world should default, all at once. And that includes us little dogs too.  Just imagine what the US could do with a clean slate. LMAO.

Vince Clortho's picture

Print their arses off?

Why would a clean slate slow down these peckerheads?

ebworthen's picture

That's all they are talking about on CNBC, "Jobless claims down!  Whoopee!"

Rick Santelli gave it straight, but in this "Brave New World" society anyone not believing that bad is good needs medication.

What a steaming crock of bullshit! 

The economy sucks!



djsmps's picture

The only number that matters for the election is the unemployment rate. In November, it will be below 8%, maybe below 7%.

pragmatic hobo's picture

so chucky evans was probably looking at these data points and going "oh, no! we need more free money!"

sbenard's picture

Wall St will focus only on the jobless claims and ignore the Durable Goods and GDP data. So will the complicit MSM! The Pollyanna Party continues!

Bubbles this way comes!

Snakeeyes's picture

Swan dive is more like it. I have to go on TV and discuss these numbers. EECHH!

Throw in GDP growth of 1.25$ and the US is screwed!


_Will_'s picture

The excess of non-defense inventory over new orders has now hit its second highest number at $59.8 Billion.  Well past the peak of the 2000/dot-com recession.

If we see an increase for August of merely half the increase in July, we'll surpass the all-time high set in January of 2009.




Curt W's picture

and then, we can officially say the channels are stuffed

Hohum's picture

ZH should stop reported seasonally adjusted initial claims.  We all know it's bullshit.

Claims data week to week is very boring.  It's always about 30K down year over year.

foodstampbarry's picture

What this recovery needs is more Joe Biden.