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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Thu, 09/27/2012 - 08:45 | 2834925 Ruffcut
Ruffcut's picture

Recovery, bitchezz

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

Thu, 09/27/2012 - 08:47 | 2834939 GetZeeGold
GetZeeGold's picture



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


Thu, 09/27/2012 - 09:06 | 2835017 Dead Canary
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.

Thu, 09/27/2012 - 09:15 | 2835062 Glass Steagall
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

Thu, 09/27/2012 - 09:22 | 2835081 Joe Davola
Joe Davola's picture

101.8% - pfft, small potatoes compared to upcoming voters/registered in some districts.

Thu, 09/27/2012 - 08:50 | 2834961 slaughterer
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.

Thu, 09/27/2012 - 10:38 | 2835346 GaryNeville
GaryNeville's picture

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

The printing press circus continues - naw China - apparenty?


Thu, 09/27/2012 - 11:12 | 2835458 mrcmmm
mrcmmm's picture

CLASSIC tune, that.

Thu, 09/27/2012 - 08:44 | 2834927 lolmao500
lolmao500's picture

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

Thu, 09/27/2012 - 09:15 | 2835065 spine001
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,

Thu, 09/27/2012 - 11:47 | 2835577 Zadok
Zadok's picture


Thu, 09/27/2012 - 08:44 | 2834928 Seorse Gorog fr...
Seorse Gorog from that Quantum Entanglement Fund. alright_.-'s picture

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

Thu, 09/27/2012 - 09:48 | 2835161 Vince Clortho
Vince Clortho's picture

QEternity2 ?

Is that related to double-secret- probation?

Thu, 09/27/2012 - 08:45 | 2834930 overmedicatedun...
overmedicatedundersexed's picture

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

Thu, 09/27/2012 - 08:45 | 2834931 JPM Hater001
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.

Thu, 09/27/2012 - 09:23 | 2835088 spine001
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,

Thu, 09/27/2012 - 08:45 | 2834932 lizzy36
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.

Thu, 09/27/2012 - 08:48 | 2834953 RSBriggs
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.

Thu, 09/27/2012 - 08:51 | 2834964 Cursive
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.

Thu, 09/27/2012 - 12:26 | 2835723 pelican
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.

Thu, 09/27/2012 - 08:53 | 2834981 RSloane
RSloane's picture

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

Thu, 09/27/2012 - 08:45 | 2834934 doomandbloom
doomandbloom's picture

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

Thu, 09/27/2012 - 08:45 | 2834935 caimen garou
caimen garou's picture

election chart painting bitchez!

Thu, 09/27/2012 - 08:46 | 2834937 papaswamp
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.

Thu, 09/27/2012 - 08:46 | 2834938 Antifaschistische
Antifaschistische's picture

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

Thu, 09/27/2012 - 08:47 | 2834940 Cursive
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.

Thu, 09/27/2012 - 08:55 | 2834995 Antifaschistische
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.

Thu, 09/27/2012 - 09:29 | 2835112 spine001
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,

Thu, 09/27/2012 - 10:22 | 2835301 RSBriggs
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....)

Thu, 09/27/2012 - 08:47 | 2834941 Meesohaawnee
Meesohaawnee's picture

and for the millionth time. data means nothing.

Thu, 09/27/2012 - 09:03 | 2835020 Antifaschistische
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.

Thu, 09/27/2012 - 08:47 | 2834945 LongSoupLine
LongSoupLine's picture

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

Thu, 09/27/2012 - 08:49 | 2834957 GetZeeGold
GetZeeGold's picture



....a market even Mongo can play.


Thu, 09/27/2012 - 08:48 | 2834947 orangedrinkandchips
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

Thu, 09/27/2012 - 08:48 | 2834948 insanelysane
insanelysane's picture

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

Thu, 09/27/2012 - 08:53 | 2834980 RSBriggs
RSBriggs's picture

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

Thu, 09/27/2012 - 09:01 | 2835011 rsnoble
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.

Thu, 09/27/2012 - 09:51 | 2835172 Vince Clortho
Vince Clortho's picture

Print their arses off?

Why would a clean slate slow down these peckerheads?

Thu, 09/27/2012 - 09:09 | 2835032 ebworthen
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!



Thu, 09/27/2012 - 09:09 | 2835041 djsmps
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%.

Thu, 09/27/2012 - 09:10 | 2835042 pragmatic hobo
pragmatic hobo's picture

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

Thu, 09/27/2012 - 09:23 | 2835085 sbenard
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!

Thu, 09/27/2012 - 12:02 | 2835092 Schmuck Raker
Schmuck Raker's picture


Thu, 09/27/2012 - 09:28 | 2835110 Snakeeyes
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!


Thu, 09/27/2012 - 09:36 | 2835131 _Will_
_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.




Thu, 09/27/2012 - 11:34 | 2835533 Curt W
Curt W's picture

and then, we can officially say the channels are stuffed

Thu, 09/27/2012 - 10:05 | 2835237 Hohum
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.

Thu, 09/27/2012 - 10:49 | 2835389 foodstampbarry
foodstampbarry's picture

What this recovery needs is more Joe Biden.

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