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Chicago PMI Soars To Highest Since March 2012 Crashing Expectations, Respondents Despondent
So much for all the other diffusion indices, both around the world and in the US, telegraphing manufacturing contraction. Three minutes before its official release, the rumor was that the subscribers had seen a 58.7 print, on expectations of a 50.0 number, and up from 49.0 Sure enough, this is just what happened when the official number hit, leading the Chicago PMI to the highest print since March 2012: a 8 sigma beat to the consensus print and far higher than the biggest forecast.
And while last time the plunge in the PMI was bullish for stocks as it meant no Tapering, today the beat is also bullish because it means QE is working, and as a result the stock market has wiped out all earlier losses. Looking at the report, backlogs, deliveries and employment all snapped out of sub 50 contraction, while production soared from 49.9 to a ridiculous 62.7. Even employment soared from 48.7 to 56.9. Amusingly, the only thing that dipped in April was Inventories, down from 40.6 to 40.4.
And yet, the biggest irony is that sentiment, at least according to the the respondents, was once again nearly uniformly bad:
- Lately the months start good and then end bad.
- Three months of declining sales in one of our core product lines indicates a slow down, though there are a couple of others hanging in there.
- Some primary commodity resins we buy are starting to moderate and even decline a bit in price.
- Business activity should be picking up and be stronger by this time of the year, but a bit more delayed than usual, so some concern there.
- With the second corrugated linerboard increase in 6 months, the producers are showing us what an oligopoly is all about.
- Corrugated costs are going up based on supposed paper demand increases. The timing of this is a bit off based on only modest increases in market demand. I expect this increase to fail with time.
- Most other items are not increasing at this time.
- New orders have been light since March, but the sales people are still optimistic that a couple of big orders are soon to be released.
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I had my doubts but I'm convinced:
White House must have established a dedicated PROPAGANDA TASK FORCE.
Dude...your lack of TV has you catching certain trends a few decades late.
2 minutes of CNBC and you would have known that years ago.
2 minutes of CNBC... sounds like a line out of "1984".
I'm sure that nothing involving Chicago has any corruption or centrally planned manipulation behind it. You can trust these numbers.
This is not the PMI we know of, it is the Percentage of Morgue Inventory which spiked in Chicago again last month
LOL
I love your humor.
Uhm...where have you been for the last five years?
Loose propaganda is one thing, but CENTRALISED CONTROLLED PROPAGANDA is another thing.
Loose propaganda is like White House calling up their media and they all say the same thing.
Centralized Propaganda is the chinese style. They have an office and many suboffices with about 50,000 (fifty thousand) employees.
Question: How many employees would the White House Propaganda Task Force would have?
ekm I am convinced my local morning news team has shock devices on their private parts and have had a labotomy to boot. This propoganda reaches further than even we guess.
When you control the major sources of "news" and the ability to censor said "news" , whether directly or through an algorithim that scrubs it, then you don't need as many as you might think. Having said that the white house has a dedicated set of followers who are more than happy to pick up the talking points and run with them.
Makes sense.
wow, can't believe Yahoo front page has this link. Zerohedge is getting viral! lol
It is Chicago...the land of truth and integrity!
Remember, fellow Chicagoans; 'Vote early and vote often!'
And when I lived there "vote the 'right way' or your health may be in danger"
I reread Upton Sinclair's "The Jungle" awhile back. It was instructive in a many ways that I didn't understand when I read it back in high school. Back then, the notion of the Chicago system of paying people to vote and the various ward bosses seemed too fantastic to be real. Now I realize that's it's a very real system and still going on.
You can download it and read it on any electronic device thanks to Project Gutenberg:
http://www.gutenberg.org/ebooks/search/
Just feels like 2007 all over again. This won't last.
It's worse this time around.
Last time, the governments around the world could still absorb large losses on the public account, and start the money printing. Both of those options have now been exhausted - although if you ask Krugman, even Japan's level of government debt is not excessive, because it's still working.
Of course, once the dam breaks, he will trumpet the fact that he did say that governments should keep their debt levels in check...
This is fking hysterical to watch. The ten year at a still historically small penis 2.16% is ALREADY popping the dividend bubble and keeping stawks in check. How about that 10yr at 2.5% Mr Bernak? What will that do for Stawks?
No wonder you want out in August.
Pussy.
More importantly, what will rising interest rates do to those "pristine" bank balance sheets? Time to sacrafice another "lehman".
and yet banks stocks rally on the perception that higher rates is good for their bottom line. You can't make this shit up.
Oh wait, I guess you can.
That is exactly what is going to happen. TPTB are going to have to do something to reignite non-market players' faith in the Fed. Sacrifice one, then in the following disaster reaffirm how much good the Fed is doing for us. Its like taking the training wheels off a child's bike long before he is ready to ride, then when he hurts himself tell him he should never ride a bike again and that bikes are dangerous. We've seen this type of action before.
what I find interesting is that if they sacrafice a bank they have made it clear there will be no bailout this time.
If that happened and you were a depositor making 0% and getting fee'd out the ass, and your neighbor just saw their savings disappear...would you keep your money in the bank?
Morgan Stanley - the little engine that couldn't. Derivative insanity.
Says it all, really.
There are no bad news, merely misunderstood news in this asylum.
They are just making it up as they go along.
It would be laughable if the underlying truth was not so tragic.
UN-fukking-BELIEVABLE
who cares about europes unemployment rate sky rocketing, as long as we get a good rigged pmi number, that is all that matters.
only in the u.s casino can the futures be down over 100 at a time, and a few hours later be green on nothing,
make up ur mind market, is good news bad because it means tapering sooner, or is good news good because it means good economy, or do they just decide what they want it to mean?
Perhaps Rahm and his boys went around to respondents saying:
That's a fine looking PMI survey you've got there. It would be a shame if anything negative were written on it.
What's a guy suppose to believe now-a-days? Keeping out of this carnival ride.
USDJPY RE-Rection!
It's the end of the month, juice the market and get ready for Tuesday!
Bad PMI #s ignored- good #s trumpeted.
oh, well, fuck, this is significant! [/sarc.]
Buzz what is going to get those yields back down?
A major stock market correction of course.
20 minute bump. Back to reality
Chicago gang killings are up too. That's bullish too, right?
You sound like an “upper-middle-class, elitist white boy solution to a problem he knows nothing about.”
Bobby "Black Panther" Rush
http://www.washingtonpost.com/blogs/post-politics/wp/2013/05/30/rep-bobby-rush-knocks-kirks-white-boy-plan-for-gang-crackdown/
"New orders have been light since March, but the sales people are still optimistic that a couple of big orders are soon to be released"
I know when i was in sales my 'outlook" was always more optimistic then my 'reality" because I wanted to keep my job and keep the boss off my back as well. Sales people better be optimistic, at least on the surface, if they want to keep their jobs.
The company who conducts the survey for the "Chicago PMI" is one "Market News International".
"Market News International" is owned by the Deutsche Boerse Group, who own several stock market bourses and futures markets.
That the cops haven't knocked on the door of this organization and locked them up for this obvious manipulation-scheme is yet is another testimony to the gangster-times we live in.
Welcome to Robert Rubin/Larry Summers world - any means are valid to achieve their goals.
This from CNBC: May Consumer sentiment Jumps to the Highest Level in Nearly Six Years.
The BS is unbelievable.
Interesting times Doc. I am convinced that rates have put the top in. Everytime the market rally's treasuries sell off and cut off the rally. If rates start dropping the marketg tries to rally and treasuries sell off again causing the same result. I would not short here but I think it's done.
You will find this interesting. This current rally is the longest rally without a three day pullback. EVER.
what does that mean, three down day in a row? or the market lower than it was three days prior? And what market? S&P 500? DJIA?
curious. I want to discuss it with some people but not sure exactly what is being referenced.
Simply three days in a row where the markets finish down for the day. Major indexes of the Dow, S&P, Nasdaq. This has never happened before where we have gone on this long without a correction lasting three days. That's what centrally planned markets have brought us.
The Dow Jones index hasn't had a consecutive 3 day losing streak in 110 trading days, the most ever in the history of the Dow Jones. It's not even close, the second place goes to a period in 1927 when it went 96 days.
Call the cops.
Agree with fonzanoon - a look at interest rate markets, domestic and abroad, as well as implied break-even government bond rates, clearly shows you that there is little (if any) room for long term rates to rise in the US - witness the deflation figure today which should be the driving force here (and not some manipulated surveys). Take away QE, stock market should go where it belongs (some 30%+ below here) and interest rates would resume their downfall.
It's true - the Dow (not the SP) has the longest rally ever without a 3 day correction - now north of 100 days - since 1894. The 20 Tuesday's in a row going up is also a record for any day of the week going up sequentially like that - not to mention that the other days show ZERO gains! This is the most blatant and easy evidence for any attorney general to go after the manipulators for collusion, corruption on a grand scale and, if you ask me racketeering charges much like the mafia. It's a shame there is no real man in that world to do that job - just a bunch of patsies.
madbraz there was a guy on here for a short stint named whiteshadow. His theory, which I agree with, is that when the economy imploded in 2008, walked to the edge and did not like what it saw. So rather than go over that edge and deal with reality, they decided to just blow the same bubble all over again. Except this time it would be the ultimate bubble. The greatest ponzi in history. The reason no politican or AG or anyone else will investigate any of this is because as Roubini said "you will find the culprits".
His example of this was this movie
http://www.youtube.com/watch?v=AdJYzgJ4CwI
It really is a good example of where we were up until 2008. If you google the guy he is now doing better than ever.
We are blowing the last great bubble, and the big money is grabbing everything it can behind the scenes. When it goes for real there will be no correction. We probably won't even be able to log on here to talk about it.
This has been the modus operandi of the Fed since inception and it is by design. No coincidence that Bernanke will exit stage left, just like Greenspan.
It will happen again and there will be a correction.
fonz, when u say '' when it goes for real there will be no correction'', do u think that once it falls it is going to crash mightly, and also, how bad is it going to releastically be for the economy?
like do u think it will just be a regular crash in markets, or do u think this is going to be something that every single person whether rich or poor will be effected in a negative way? great depression like for example?
We can go on and on building up case after case of illegal activity going on in markets - I mean, c'mon, HFT and algo front-run trading is the most blatanly illegal activity that goes against any piece of legislation ever written defining what is legal and what is illegal when it comes to stock markets and stock trading in general.
Look at these "confidence surveys", conducted by companies that own stock exchanges and future markets and purchased the surveying company - you don't need to be a crack lawyer to figure out that it is blatantly criminal activity. Look at Fed minutes being released "accidentally" early to key market players.
It's all very disgusting.
I agree. I think that Japan's efforts to stem the bleeding of the Yen has put a top in all these markets.
Amazing that there is still no inflation to speak of.
okay, big deal. it's a data point. there are positives and negatives in the mosaic that make up the economy. keep focused on the balance of positive vs negative in the entirety of econ data points. that is still negative at worst and flat at best. i know one thing this data point isn't: rising high enough and signaling enough future strength to support a 5 yr high in stock markets with close to peak valautions to boot.
BTW, the CPMI was telgraphed and televised the s/p jumped a full 15 minuted prior to the #, someone knew.
As for the CS it is BS. There is no corellation to actual economic effects. IT is pure MSM candy, and Krug Krap.
PMI= "Post Menopausal Injections", of Bernakamones.
Yen what do you think?
POMO is dead. If that POMO money pushes up stocks yields kick up in return and cut off the fuel supply,
Wait till June when those 401k statements go out and people see the results in their bond funds. So they sell their bond funds and yields creep higher and cause further damage to dividends, sending the market down.
It's going to hurt.
Fonz, I think consumer sentiment data is taken in the Hamptons. It does seem like we're at a crossroads with respect to the bond/stock meme. Yields have been creeping higher, and the benefits of POMO on equity markets are diminishing.
When those people sell their bond funds, I hope they buy some PMs and keep the rest in cash.
Many of those 401(k)'s have eliminated cash options, and they will break the buck soon enough if money goes rushing in to them. As others have noted, the ecxits have been locked, and I smell smoke.
Look no further than the $20+ billion/day that the NY FED is doing in securities lending (treasuries) these days, when things are supposed to be so good. There is a shortage of collateral for the repo market. Terrible sign.
This is digraceful, I believe nothing that this courrpt cartel is involved in.