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ISM Has Biggest Miss On Record, New Orders Plunge Most Since 1980
The downward revision to last month's recent record high appears to have been the warning flag but this is a disaster. ISM Manufacturing dropped by its most since 2008 to levels not seen since May, missed by the most on record, and new orders collapsed at the fastest pace since December 1980. The employment sub-index also tumbled from 55.8 to 52.3. "Poor weather" was blamed by some respondents and still hangovers from the government shutdown but these numbers are simply unprecedented as the data came in at a 6-sigma miss to "economist" expectations.
Surprisingly, even the ISM is sick and tired of the generic excuse:
- ISM'S HOLCOMB SAYS WEATHER DOESN'T ACCOUNT FOR ENTIRE SLOWDOWN
So, one needs to come up with new and improved generic excuses for biggest miss on record:
6-Sima from smart people's expectations...
And New orders dropped by the most sicne 1980...
The full component breakdown with New Orders highlighted:
The respondents were still hopeful, but scapegoaty, as some were crushed by the lack of balmy 73 degree weather in the deep of winter:
- "We are seeing slight improvements, year-over-year, month-to-month, across most regions and business segments." (Apparel, Leather & Allied Products)
- "Poor weather impacted outbound and inbound shipments." (Fabricated Metal Products)
- "Good finish to 2013, but slow start to 2014, mostly attributed to weather." (Petroleum & Coal Products)
- "U.S. government aerospace business is very brisk." (Transportation Equipment)
- "Slight improvements in defense business. But still lagging from previous years." (Computer & Electronic Products)
- "Cautiously optimistic about increasing volumes but still challenging, and margins remain low." (Chemical Products)
- "We have experienced many late deliveries during the past week due to the weather shutting down truck lines." (Plastics & Rubber Products)
- "We continue to be busy, working six days, 24 hours a day." (Primary Metals)
- "Delays in government product certification due to the partial government shutdown last year are still negatively impacting delivery and inventory levels." (Miscellaneous Manufacturing)
Finally, the Hopium is weak with this one.
- "Restricted optimism heading into Q1." (Machinery)
He must be sent back to the NSA for some reindoctrination.
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We just might see the deer again tonight.
Yeah and a big old and really hungry bear is gonna be chewing away on it too!
Again, major support is broken this morning!
http://1.bp.blogspot.com/-i4Rup6npm8Q/UuxibUiXkBI/AAAAAAAAXqo/tskGcuPEV2...
I so do pine for the malaise days of Jimmy Carter.....you know.....the second worst President ever.
“New orders dropped by the most since 1980...”
Where’s the Gipper to tell us everything is OK and that we can all borrow our way to prosperity?
Time to invade Grenada again!
You mean back when deficits mattered, interest rates were increased to combat inflation and when money printing caused gold prices to increase? IOW when basic economic principles were applied.
"Run, Forest, Run!"
I have this friend you see, he is always pining for the fjords.
Who let those numbers hit the press?
some is getting Suicideded for this
Perhaps if we merge fast food into manufacturing, the data might improve.
Oh, wait...
Yep they did that years ago. Some Ivy league braintrust decided that making burgers was manufacturing.
Wait, what? Is this really true? What else not-so-traditional manufacturing is included there?
yep it is.hence the joke dow non industrials
Hey... American Express is the premier plastic wafer manufacturer.
Yup! 2004
http://www.nytimes.com/2004/02/20/business/in-the-new-economics-fast-foo...
And what are Treasury's doing? Oh yeah, collapsing in yield.
On the 10yr, after 2.6% gets taken out, 2.50-2.55% will be almost automatic.
Bad moon rising - I think we hit the debt limit soon, too.
boner surrender, there is not debt limit......
The Republican party is suiciding right before our eyes, and I doubt that they will even exist by the 16 elections, the veil of two teams has fallen...... only differences in the speed of the implementation of the Progressive agenda....
"Bad moon rising - I think we hit the debt limit soon, too."
Bad Debt rising! especially in Asia!
At some point, BernanQEllen can't print us out of this mess. We may be at that point.
Uhmmmm.. They are printing us into this mess.
@Dr. Engali
Agreed that the Fed is the problem. The Fed has been very successful (moreso than I ever thought possible) at bailing water from a leaking boat; however, the rate of water flow from the leaks is becoming too much for the Fed's bucket.
'You've got a hole your bucket,dear Janet,dear Janet".
Maybe. The setup seems there for a shitbag NFP Friday followed by some ort of monetary or fiscal policy boost. That would be the catalyst for this to stop. I still believe the market just wants moar. It's getting interesting though.
It's just the weather - or tanks in the street before tomorrow morning. Period! b ;-)
Non shitbag NFP...and we shall see. I am not convinced this in the ONE. Long USD/YEN....again.
They will do it anyway.
Remain Calm! Federal Food stamp program to be reinstated ....
And Wal-Mart applauds.
I blame the shitty "superbowl".
The Super Bowl Theory indicator is coming true already!
Shit is getting pretty deep. Put on your boots Yellen.
Shit is getting pretty deep. Turn on your printer Yellen.
Granny I think we are getting to an interesting point. They can turn that printer on and push the market up. But it will only anger Joe Sixpack more to see the 1% benefit. Something else has to be on the way. Either some form of stimulus that we did not see coming, or they are fine with an implosion.
I'm beginning to think it's B, but I'll reserve judgment right now. It's still pretty controlled, and they have thrown an awful lot of Bernanke bucks to try and save the system. It will be interesting to see if they let Yellen take the fall for any collapse.
I hear you....but they would let Yellen take the fall? Just my thoughts but the longer this goes on the longer this seems to expose Bernanke. I mean holy shit he is gone a few days and tapered on his way out and the whole thing collapses before Yellen sits down...
I wonder if they are going to play the big card. The one that says the fed was right all along to be doing QE...and this is what happens when they get pressured by outside forces. Our planners know what is best for us, and we were wrong to make them stop.
I don't know, it's going to be interesting. This could spin out of control in a quick way.
China can still pull a short term stick save..... go massive stimulus, build some more 2,000ft tall buildings and ghost cities, or B massive military buildup....
Two, and they missed the opportunity yesterday, there could easily be an event that is outside of Dear Leaders control that would give them the stick save, by starting a war, in order of liklihood,
North Korea
Iran (Maybe Isreal starts it)
Ukraine (kinda an Arch Duke thingy)
You caught Rickards' brainwave. He said the next move would be a helicopter drop to the consumer. We may very well see a direct stimulus before long.
Fed doesn't have political cover for that yet. At this rate of decline they will soon.
Fed lost control of the bond market last year and now they will lose control of the stock market.
There is only one thing left to do and that is run for the true safe havens of TWTR FB and TSLA
already loaded up on those
UA, CMG & BWLD too
and MyIRA!
I've fallen and can't hit CTRL-P!
We clearly need new ways to calculate this number...
What would happen if you compaired it to American production 1491?
the fed and EM are tightening as the next leg lower of the depression hits. no coincidence the fed does this as bullishness/bearish spread largest in history. ben killed all shorts and sucked in all peasants. time for the reaping.
It's the weather, people, just the weather.
Blame It On The Rain.
http://www.youtube.com/watch?v=NwrL9MV6jSk
Fake singers...just like this fake economy...
Blame it on the Bens that were fallin, fallin
Blame it on the Feds that were printin all night
But whatever you do, don't put the blame on you
Blame it on the Ben yeah yeah.
Economy booming....*BOOM*
To your battle station (printing press) Yellin! Roads, where we are going, we don't need roads!
'Just BTFD'ers' come on you guys...UNITE!
QEen Yellen loves to print.
Let's see the Fed's balance sheet go from $4 trillion to $12 trillion for the US government to try and stimulate out of a depression. Watch the Federal deficit go from $17 trillion to $25 trillion.
Like drugs, more and more is needed to maintain the high, until the addict dies.
Looks like gold is moving inversely to equities once again. Feels like '09.
I'm just glad the pool I ordered arrived last week. Water = the next oil.
Thats not your water, you didn't make that water!
Good, I have well. Nice to be on the ground floor.
Argentina, here we come. Print moar!
Wow just think how screwed we'd be if we weren't in a massive recover and a mfg rennaissance at that! I can see puffs of smoke emerging from under our nukes right now.
The Bernank must be smilin about now.
These things happen when you are in a depression that experiences intermitten recessions. Those are the facts.
Clive Maund was spot on the money with his call on Jan 2nd 2014 - "Broad US Stock Market Update - No New Paradigm - Get Out Now!!" and we highly recommend to study his work. With ongoing sell off in the equity markets and new scare about the emerging markets rising Gold physical demand is the very important indicator to follow now. China has become the top Gold consumer in 2013 and now demand for Gold is picking up all over the world including the U.S.
http://sufiy.blogspot.co.uk/2014/02/clive-maund-gold-market-update-tnrv-...
I noticed something really odd outside the big box strip center in my town. Half the Target and Best Buy parking lot was coverted into a shipping container storage lot. I have never seen this before.
I asked the manager at Best Buy what the deal was. He told me the stores have no room for the new spring inventory because the warehouses in the backs of the store are full of unsold 2013 inventory. So the plan is to store inventory in the parking lot until the product in the warehouse can be sold off. Most of it is fall seasonal merchandise they can't sell now.
I asked when the new product from CES was going to come in. The guy told me the earliest would be June. Some Magnolia departments might get a few new TVs in March but bulk Best Buys are going to be selling 2013 models well into 2014.
I noticed this at Home Depot on Saturday. Two big shipping containers right smack in the middle of the parking lot.
Two possibilities; Product or Fema coffins.
adr, that jives with uber-packed isles in retial stores...can barely walk thru some of them stuff is piled up everywhere. Some of these stores are literally flooded with inventory from the winter and even still from last summer. I am not sure where they will ship this oversupply when the next Hecho en China stuff floods in?
Wholeheartedly agree with this and the adjoining comments.
If channel stuffing is good enough for the auto industry, then why not retail?
How does this jibe with Wal Mart articles stating that there is not enough product to keep their shelves full?
Well that tracks with the details in the iSM report. Order Backlog decreasing. Inventories decreasing. Production decreasing. Prices increasing. No wonder business are sitting on all the cash they can.
There's a lot of things that could be said, but a few words of wisdom ought to sum up the matter quite well.
1. God is not mocked.
2. Demographics is destiny.
3. Whatsoever a man soweth, so also shall he reap.
and a latter-day addition by Jim Grant...
4. The fed can change how things look, but it cannot change what things are.
Anybody else notice the Prices Paid popped much higher on the table above?
Bernanke joins Brookings and his shit economy is going to crash. Underlying problems were never fixed. They have actually gotten much worse.
A couple of odd pieces out. Commodites need to drop, Sub $90 oil, and the Euro needs to break 1.30..... these are what dont look right to me.
That won't happen until we "officially" hit a "double dip recession". So long as they can keep up with the Bureau of Lies & Statistics saying we are in a recovery, you won't see commodities tank. The indicators all over the world are that they can't keep the lid on tapering much longer. When the Repukes cave on the debt ceiling at the end of the month, watch the spending in congress go full retard again to the Free Shit Army and Corporate Bailouts (0zer0care insurance providers this time) causing the deficit to explode, and the Fed being forced to Un-Taper as a result. The whole Western World is in the same boat. They have to keep saving each other or the whole house of cards will collapse.
The current administration's economic policy in effect has been to stimulate the unproductive and stifle the productive. Money thrown at feel-good 'green' projects, bailouts of zombie banking and manufacturing companies, increasing length of unemployment compensation, threats to energy producers, threats of confiscatory tax rates and openly calling for redistribution and class warfare have all served to misallocate trillions of dollars the American people have nothing to show for except additional debt. These things are all pretty much known by anyone paying attention although the merits of various programs will be argued pro and con till the end of time.
One unknown that I wonder how much is influencing economic activity now is the intangible uncertainty. With the drumbeat of scary news coming from every direction every alert person has cause to pause in spending diminshing income. Now we have the gargantuan band-aid of a crony government fix on 1/6th of our economy, the Orwellian-named Affordable Care Act. Tinkering around unsuccessfully with 3 trillion out of a 17 trillion dollar economy will impact not only the quality and quantity of health care, but have a deleterious financial impact as well.
Throw in China's banking crisis, their multi-trillion dollar misallocation of capital, the inability of any government around the world to do the right thing at the right time and we could be entering a perfect storm of financial reckoning, ready or not.
It's just 2008 all over again. This time the bailout will be the 0zer0care Insurance Providers. They have no bubbles left with the Ponzi of last resort except the Stock Market. Technology was so 1999. Can't pump housing or real estate. Can't pump commodities. Can't pump PM's. If it really goes bad, they will push Barry Bonds to confiscate whatever retirement accounts are left. It's not even hard to predict anymore.
Who needs manufacturing when we have EBT, Section 8 houses, free cell phones, unlimited near-zero down houses and Duck Dynasty?
Convenient timing after the state of the union according to the Kenyon clown
Retail is laying off like crazy - get your food stamps folks and BUY MOAR FUCKING SHIT YOU DON'T NEED!!!!!
Enjoy the slide Yellen - take that bitch!!!
Poor weather? Maybe thats the problem... They should build manufacturing plants indoors..................