Kansas Fed Plunges To 2-Year Lows, New Orders Crash: "Economy Not As Strong As Media Portrays"

Tyler Durden's picture

How can it be? Services PMI was at 6-month highs. The Kansas City Fed Index tumbled to -4 in March (against expectations of +1) and was last below this level in Feb 2013. KC Fed has now missed for 6 of the last 8 months and the report is a disaster across the board. New orders plunged to -20 (2nd lowest print since Lehman), order backlogs imploded, average workweek collapsed to -17 (lowest since Lehman), and future capex expectations fell to a five-year low. As one respondent noted, "we do not see the economy as being as strong as a portrayed in the national media reports."

 

Ugly...

 

Uglier...

 

As for Capex, stick a fork in it: worst expectations in 5 years.

 

Ugliest... Selected Comments.

  • “We continue to produce to fill orders we have in house but invoicing is down because customers are delaying shipments due to the large amount of snow in their yards. All of the suppliers have sent notices of a raw material increase. If those are implemented our projections will come to a grinding halt.
  • “The drop in oil prices is negatively impacting our business levels. We do not see the economy as being as strong as a portrayed in the national media reports.”
  • “Due to the port disruption, we are diverting as many containers to east coast ports as possible.”
  • “We are still hiring and operating at full capacity but the flow of new orders for delivery in 2016 has significantly slowed. Hopefully, this trend will improve as the oil & gas producers deal with their excess production issues.”
  • The low price for oil is taking its toll on the demand and price for energy related products we offer. Momentum we experienced earlier this year has left and we are again cost cutting and becoming lean. Our capital expenditures are focused on removing labor content in our processes and products due to the high cost and risk added by regulation and administrative action.”
  • With the strong dollar, we keep continuing to see flood of low prices imports thereby reducing our margins.
  • “Because of the West Coast port disruption, parts are tied up in transit that are several weeks late. Production lines have been shut down for days at a time and we have had customers cancel orders. We will not regain that business when the raw materials come in and in fact have lost some customers.”

But apart from that... everything is awesome.

 

Charts: Bloomberg

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Chuck Knoblauch's picture

The Pentagon run the PPT out of DC.

Why do we have all these little banks making problems?

jaxville's picture

   It appears that the developing recession is going to be recognized as something far worse.  The sooner they publicly acknowledge that, the sooner they can really put the pedal to the metal at the Fed.

Chuck Knoblauch's picture

The US doesn't want to go down alone.

They want to pull as many down with it as possible.

The TBTF strategy is the only strategy they have.

Big decisions are going to have to be made soon.

Do you want sovereignty, or inclusive capitalism (commie cover for neo-feudalism)

NoDebt's picture

Doctor Yellen to the ER, stat.  Patient suffering severe withdrawal symptoms, in desperate need of another QE injection.

malek's picture

It's all the media's fault!

LawsofPhysics's picture

not quite, sounds more like the death of all fiat currency.

kliguy38's picture

You mean the "developing recovery"..........but lets be serious for a moment.....without EBT unemployment etc.....its a Depression.....

de3de8's picture

Must be getting close...

dimwitted economist's picture

All together now: IT'S A RECOVERY!!!! (gas soon to be back to $3 a Gallon!)

insanelysane's picture

Need a new keyboard.  "we do not see the economy as being as strong as a portrayed in the national media reports."

asteroids's picture

Blame it on the media eh? They only report what you lying cocksuckers print and give them.

ShorTed's picture

...and what their lying corporate overlords tell them to print.

fixed

Fun Facts's picture

and what the ZWO bankster cabal who controls the money and owns the media tell them to print for their idiot donkey slaves.

more fixed

Nobody For President's picture

...gas soon to be back to $3 a Gallon!

Soon? $3.39 a gallon yesterday, been over a 3 handle for two weeks plus (N.Cal)

KnuckleDragger-X's picture

Damn!!!! This recovery is soooo exciting, I think I just wet myself......

FreeShitter's picture

IKR, my dick is harder than chinese math

mygameon's picture

Freeshitter (love the username 100+),  Since homo sapiens all use base 10 math, chinese math cannot be technically "harder".  I do believe that Amercians do not understand math as well as the chinese and therefore do not practice it with the same concise elegance.  Therefore I would say:  My dick is longer than American math.....

Either way, Hory Cow, we tu stupid and Frucked since most of us never question any of this shitshow.

LawsofPhysics's picture

In addition, don't foget that the Chinese have a much longer history with fiat currency as well.  Historically speaking, they invented it and America has only had a fully fiat monetary system since 1971.  40+ years of experience versus thousands of years...

KnuckleDragger-X's picture

Yep, and they pretty much invented modern bureaucracy too.....

Snoopy the Economist's picture

"I do believe that Amercians do not understand math as well as the chinese and therefore do not practice it with the same concise elegance."

 

I'm going to guess that you know very little about math. Try taking engineering courses and then tell me Americans do not understand math - perhaps you should restate it so it is more appropriate as "most morons can't do math".

mygameon's picture

Snoop, hey dipshit it was a joke. I have a Ph.D. In chemistry and have hired many engineers. I can tell you for a fact that Chinese are better at math than Americans with equivalent education.

It is inherent in Chinese language. For your knuckle dragging ass I recommend that you read Malcolm Gladwell's essay on the subject. It will be dumbed down enough for you as it was written for a general audience.

Snoopy the Economist's picture

Ph.D - impressive; I only have a BS. I give you credit for reading this site since half the Ph.Ds I have worked with have no clue what's happening in life around them.

SheepDog-One's picture

Well that should certainly be bad enough news to drive stawks the next leg higher!

yogibear's picture

The stawk algos buy on bad news.

Bring it on!

orangegeek's picture

done frauding the global economy yet yellen?

 

SNDK posted their earnings confession  this morning - stock down nearly 20%

 

c'mon AAPL - let's hear it!!!!!!!!!!!!!!!!!

Osmium's picture

Well, that's just because we already have all the storage we will ever need.

 

 

khakuda's picture

Time to lower rates.  Oh...wait.

Chuck Knoblauch's picture

The market only goes up when things go according to plan.

Good news or bad doesn't matter.

thismarketisrigged's picture

tyler, u said this was the 2nd biggest drop since lehman. what was the biggest drop since lehman?

Shaznardickleze the Doon's picture

I believe it was this event - https://youtu.be/XCawU6BE8P8
Which was apparently a trap. 

Colonel Walter E Kurtz's picture

The nearer you are to the shale oil contraction, the earlier impact you will see. Everyone else is enjoying the lower prices for now, but the infection of debt based oil exploration will spread to all. Expect the FED to start directly buying oil to keep the ponzi going.

lakecity55's picture

i think it's why they mentioned filling up the SPR.

bailouts for shale drillers.

The Joker's picture

Alright everybody, AIG, BofA, CITI, 1st National, Lonestar,

What do you want?  1 -2 -300 billion?

C'mon over, I'm your Candy Man.

Who can fix a mortgage, General Motors too?

A bail out check for me and a bail out check for you.

Obama Man can. 

Yes, Obama Man can.

Cause he mixes it with hope and makes the world taste good.

Who can give you healthcare?

Who can save the poor?

Who can pick the teams that are in the final four?

Obama Man.

Yes, Obama Man can.

Obama Man takes the problems

and turns them into cream and peaches.

Sugar coated smooth tongue speeches, I hope he practice what he preaches.

Who can take tomorrow

and spend it all today?

Who can take your income and tax it all away?

Obama Man.

Yes, Obama Man can.

Cause he mixes it with hope and makes the world taste good.

Who can buy and Ipod

and give it to the queen?

Who can take economy and turn it into green?

Obama Man.

Obama Man can.

Cause he mixes it with hope and makes the world taste good.

Hey Chrysler, GM, you want some money?

Ford you want some?  No, you don't?

Ok, good, more for GM.

I'm Obama Man.

Yes, I can.

 

- Greg Morton

Chuck Knoblauch's picture

I'm an illegal Mexican.

Can I borrow $300k for a new home?

I have no job or income, but do have a prepaid obozo phone.

LawsofPhysics's picture

The center will not hold...

Everyone must have already purchased all the durable goods they need....

PTR's picture

Is Colt and S&W still in business?

 

Then I guess that means not all durable goods.

AbbeBrel's picture

playbook follows:

1) China devalues Yuano (ZH calls it a Zhollapse, and a Worse Than Lehman moment)

2) A new chain of Two-Bit stores open in modified shipping containers in the parking lots of abandoned malls across the USA

3) the Two-Bit stores are immediately extremely popular, as they offer credit on purchases

3) Walmart and the Bucko store chains experience a Zhollapse in sales as USA customers can no longer afford to shop there

fremannx's picture

Even the Fed must now acknowledge that the bubble has burst. The markets are in obvious decline wiith no real support, economic or financial, in sight. The analysis is clear...

 

http://www.globaldeflationnews.com/anatomy-of-a-bubble-how-the-federal-r...

 

Chuck Knoblauch's picture

Janet Yellen having a conversation with JFK in hell.

https://www.youtube.com/watch?v=pfmkRi_tr9c

Anyone have a coin???

The Federal Reserve System is an foreign agent of chaos.

buzzsaw99's picture

sweet twist on the trademarked saying:

2nd lowest print since Lehman

second lowest, lulz

buzzsaw99's picture

oh, also, BULLISH!!!

Quinvarius's picture

But we all know the very next data point is going to be super bullish.  Because that is the pattern.  It is all about creating momentary tradable volatility in this age of Fed autopilot.  Yell "fire" in the theater.  Then 10 seconds later bring in the Fire Inspector to assure everyone there is no fire. 

cwsuisse's picture

I don't think sentiment indicators are any good. Sentiment is constantly manipulated as we often read at zerohedge. It is more telling to look at unemployment (23%) and GDP based upon realistic assumptions on inflation and without added revenues from illegal activities, in which case - the US is in a recession. 

Creepy A. Cracker's picture

You can say that three times...

Kprime's picture

keep repeating that, now my sentiment is down 26%, adjusted for the number of times I read your posts.  My output is almost nil, whiskey uptake is rising.

cwsuisse's picture

I don't think sentiment indicators are any good. Sentiment is constantly manipulated as we often read at zerohedge. It is more telling to look at unemployment (23%) and GDP based upon realistic assumptions on inflation and without added revenues from illegal activities, in which case - the US is in a recession. 

cwsuisse's picture

I don't think sentiment indicators are any good. Sentiment is constantly manipulated as we often read at zerohedge. It is more telling to look at unemployment (23%) and GDP based upon realistic assumptions on inflation and without added revenues from illegal activities, in which case - the US is in a recession.