Projected Corporate Margin Expectations Dip To 7 Month Lows

Buried in the Empire Fed manufacturing data is the forward expectations for Prices Paid and Prices Received. Taken together, somewhat obviously, they reflect businesses views of their margin expectations for the future. For seven of the last nine years, this future margin expectation has risen from mid-year into the end of the year (whether hope-driven or real fundamentals is unclear), but this year, the picture is very different. For the first time since 2007, future margin expectations have plunged into year-end as expectations for prices-paid have notably risen relative to expectations for prices received. Though the sample is small, the last time we saw such a huge divergence from the seasonal tendency for margin expectations was followed by an equity market reaction many would prefer not to remember.

The lower pane shows the implied margin expectations from the Empire Fed survey. Notice the pattern into year-end...

which is highlighted more specifically here - the blue line is the 10 year average seasonal tendency for the margin expectation (a fall into mid-year and rise into year-end). This year saw the same pattern into mid-year and then a collapse from June to November (Red line)... quite notably different.

Charts: Bloomberg

Comments

[evolutionx]

New Details About Sandy Hook Shooting Suspect Adam Lanza. The mother of the gunman who killed 20 children and seven adults in America’s worst school massacre, was a gun-proud “survivalist” preparing for economic collapse, it has emerged.

http://www.mmnews.de/index.php/english-news/11572-update-new-details-about-sandy-hook-shooting-suspect

[otto skorzeny]

I see preparing for the worst now makes one some type of marginalized kook. it used to be that was considered prudent

[Zer0head]

Congratulations to this hours winner of the California Lottery where every public employee is a Winner

California Highway partrol divisional chief Jeff retired last year as the best-paid officer in the 12 most-populous U.S. states, collecting $483,581 in salary, pension and other compensation.

Talbott, 53, received $280,259 for accrued leave and vacation time and took a new job running the public-safety department at a private university in Southern California. He also began collecting an annual pension of $174,888 from the state.

 http://www.sfgate.com/business/bloomberg/article/Highest-Paid-California-Trooper-Is-Chief-Banking-4123165.php

[SmoothCoolSmoke]

Why can't this guy get paid for unused vacation?  Happens everyday in Corporate Ameriika.

[Zer0head]

paid for unused vacation in corporate Amerika? maybe at JPM but not at the Walmart in bumfuck arKansas

[Enslavethechild...]

Let me guess, he thought Bankers were evil and should all be hung...

[GMadScientist]

The word is 'hanged', let's not reach for the stars okay?

[francis_sawyer]

Difficult for a banker to be 'hung' when, by & by, they're categorically a bunch of pussies...

[Sockeye]

Let this be a warning to all you prudent people out there. Being prudent will turn your children into monsters. Do not rely on yourself, depend on the government to provide. Start by swallowing this psychotropic medication.

[GMadScientist]

It's Connecticut...they're all hastening the economic collapse in one way or another.

[hugovanderbubble]

EBIT/Sales 2013 dropping like Stones

[jeff314]

no need for margin with QEEEEEEEEE

[otto skorzeny]

they'll make it up on volume/sarc

[hugovanderbubble]

Baltic Dry Index should have to be halted...7XX lol , well who cares about it... Is a beautiful deflationary feeling xd:)

[otto skorzeny]

can that be traded or is it simply what it says-an index?

[GMadScientist]

Not easily; better to target a few specific shipping companies (for shorts, obviously).

[Debeachesand Je...]

Corporations will have their "balls to the wall" sooner rather than later.

[GMadScientist]

And by "corporations", you mean the captive audience of 401k holders across the US.

[SmoothCoolSmoke]

Obama got the upper hand on the NRA.  Sorry....but he does. 

[LawsofPhysics]

Yes, and I am sure that the coming "war on guns" will be just as successful as the "war on drugs" or "war on terror."  - FAIL

[prains]

Are you sure this chart is not for corporate welfare expectations

[SheepDog-One]

Oh...nothing but bad news and fiscal cliff 2 weeks, but I guess all is well with Bernank Clownbux at least!

[orangegeek]

Corporate earnings turning down.  The Q2 and Q3 strategies to fire employees to show greater profit because revenues suck looks like it's going to end.

SP500 should tank nicely in January.

http://bullandbearmash.com/chart/sp500-weekly-closes-channel-support/

[q99x2]

I want a Bernanke printer for Christmas.

[NEOSERF]

Profit, shmoffit...ability to float more bonds to pay overhead is the key.   The Bernank shows us the way...