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Factory Orders Scream Recession: Annual Drop Biggest Since 2008
This has never happened outside of recession... Year-over-year, factory orders dropped 6.3% (adjusted) but 8% non-adjusted, the most since the financial crisis. Against expectations of a 0.5% drop MoM, manufacturers saw new orders tumble 1.0% and previous months were revised dramatically lower. Factory orders has now missed 10 of the last 11 months.
Factory Orders have fallen for 9 of the last 10 months...
Seasonally adjusted things look terrible...
Non-seasonally adjusted they look even worse..
Recession is coming...
Charts: Bloomberg
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Yeah, but no interest rate hikes! BTFD! To the moon!
DavidC
no interest rate hikes!
Good news....we live another day.
its a great time to let greece DEFAULT. let stocks crash and blame the "lazy greeks" (CNBC spin, not my take). that way, there is no blame in the media that the Fed is to blame. and then the Fed will get the green light to print moar and more fiscal stimulus (rebate checks). and all will be fixed with duct tape and elmer's glue for another 3-6 months.....
don't leave out the poor-to ricans - blame on puerto rico, greece, chinese hackers, and russian aggression
how Greek of you
SHITTY FUCKING FACTORY ORDERS IS FUCKING BULLISH! FUCK FACTORIES. FUCK ORDERING: FUCK PRODUCTION. Just everybody get the iphone 6 and Netflix and we are all set for ES 2500.
SINCE LEHMAN !!!!
I wish this pesky weather would leave us the fuck alone.
Hi INVENTORY..........................................is a bitch
Weather..................not so much
… they could give it away.
Its a complete mystery how they've kept the airports open.
See, this is why we needed to fast track TPP. Hopefully, the full benfits of TPP will kick in before our record low unemployment of 5.3% begins to rise.
But, but but... the green shoots.....
this guy Green...watch out for him...dude's got a twitchy trigger finger...
ZIRP eternal.
...until NIRP... (which we already have in real terms).
Exponential equations and moral hazard can be a real motherfucker.
The recession never ended. The career Mom's and Dad's of the 70's and 80's are today's part-time Home Depot/Lowe's/Best Buy employees scraping by or living on credit.
The U.S. - like the rest of the debt strapped Western World - is a house a cards, a Ponziconomy living on borrowed time.
The depression never ended.
There, fixed that part for you.
The depression was only postponed for around 3 decades due to the government jobs program known as WWII. Not to worry though jobs program III will be here shortly.
How about bullshit orders like the employment report, why dont we start to count them as orders that are manufactured?
There won't be any recession so long as Imperious Leader is president, so says the Ministry of Truth.
Exactly
As long as equities are at or near record highs, and our social welfare net is so comprehensive - nobody cares. That's the whole purpose of pumping the stock market - to maintain confidence in our economy AND our government.
As a nation, we're only slightly more sophisticated than China and their stock market Ponzi scheme. Do you know how many times I've heard people give Obomit credit for the bubble in our equities? I'm not kidding. It sounds like I pulled that out of my ass but its true. There are buttloads of Democrats out there that think Obomit is responsible for the stock market bubble. BELIEVE IT, OR NOT.
Real GDP has been screaming recession for years now. Even Stevie Wonder saw the recession coming years ago.
Let's not forget that US inflation numbers are completely fake - so real US GDP is much, much lower:
The Chapwood Index for 2014 was 9.7% and official CPI in the land of the free was only 0.8%. So the Nominal GDP of 5.6% for 2014 becomes real GDP of -4.1%.
The revised real GDP for years 2011 to 2013 worked out to -6.2%, -6.5%, -6.5% respectively.
What is the Chapwood Index?
"The Chapwood Index reflects the true cost-of-living increase in America. Updated and released twice a year, it reports the unadjusted actual cost and price fluctuation of the top 500 items on which Americans spend their after-tax dollars in the 50 largest cities in the nation."
http://www.zerohedge.com/news/2015-05-29/inaccurate-statistics-and-threa...
How about "FUCK YOU...Yellen"
ah-so! you must be one of those evil chinese hackers!
Just curious, is that change in dollar amount or unit amount?
Given that manufacturing commodity prices, such as oil and metals have been in decline for some time might the majority of the decline simple be related to material cost and its related pricing translated into finished goods?
Just as inflation and labor arbitrage don't really help a consuming economy, raw material deflation and local manufacturing (that looks like a lowering of productivity) don't really hurt an economy.
Excellent point.
Factory orders are calculated in current dollar amounts. If prices fall , then inventory levels are valued at a lower price. If they rise then the opposite is true.
Its the strong dollar kicking in.....our crap is too expensive now in the world market....but my beers down here in Colombia are much cheaper
GMO or non-GMO beers ?
BLS just announced they are going to start counting jobs saved by the Dear Leader #wearescrewed
I used to see factories when I was a kid. Now I see everyone having barbecues and going jogging and fishing at the park. A lot of the others are too fat to work. Maybe science can give people the ability to hibernate soon so Winter won't be a problem.
It's already blowing dead bears out there. This is nuts.
Helleconia Winter for the US
Ever since Q1, I've been following the Atlanta Fed's GDPNow page. For Q2, I've noticed something weird is going on:
They seem to ignore bad news. Today's numbers were bad, as has happened on several other occasions, but their GDP prediction is 2.2%. It doesn't feel like much has changed since Q1, so I'm wondering what's going on with them. Is it just me noticing this?
They were called into the office and given a 'tune-up'. No weirdness - everything is fine now. Freedom is slavery...
It still has never happened outside a recession. The economic meltdown of 2008 was so bad that this is a last ditch attempt and thus they can't risk calling it what it is for all the money they've thrown at it AND what the consequences of it NOT working will be.
I am glad I lost my good well paying manufacturing job..it allowed me time to retrain to become a bartender when the real recession/depression comes..
it's that weather!
The Chinese will bring manufacturing back to America.
I wonder what that will look like?
Round-eye coolies...?
honestly I'm not super sophisticated in some of this research and am confused because I see this article but I also saw an article on this.
https://www.instituteforsupplymanagement.org/ISMReport/MfgROB.cfm?navIte...
I don't see how both can be right, so what am I missing?
Well. Tell me something I don’t know. Missing income that came from missing jobs of missing industrial production and missing trade of goods stored to rot in warehouses or ships. Only retard eCONomists can be blind to the facts of permanent of population.
What so-called economists are trying hard to overlook is severe “real” inflation of commodities required for basic human subsistence such as food, transportation, education, healthcare, home rent or lease, etc., not as much due to nominal prices increase but due to massive aggregated income collapse of working people all over the world.
The so-called economists also trying hard to overlook severe deflation and depreciation of assets own by majority of working people, such as labor power, skills and education, conservative retirement assets, savings, value of work benefits, value of social programs, consumer services, land lease value, furniture, electronics, used cars mobile, phones and gadgets, computers and software, used clothes, memorabilia, low brow art and antics, etc. not as much due to loss of value of these assets but because of massive aggregated “real” income collapse due to “real” inflation and over-leverage affecting working people all over the world. In other words money circulation in second tier economy of 99% almost came to standstill. Almost all income was distributed up to 1% or rather 0.1%
This is double whammy of “real” income and asset deflation and hence working people “net worth” spiraled down, accelerating toward collapse. The process of pauperization of western societies not only affected middle class but working class people when it initiated in US over three decades ago.
Very few emphasize enough that core of the issue is utter collapse of demand (due to collapse of income and value of assets) for anything throughout the world due to massive over-leveraging of business of all sizes and households often in US dollars/Euro/Yen not in domestic currencies leaving CBs helpless.
People simply paying off their loans and obligations and have nothing left for consumption or investment. This catastrophic collapse of world demand (pointed out by Russia and China) for most goods including food and oil causes, continuing for almost a decade now, dramatic flight of capital resulting in recalling massive amounts of speculative capital back to US. Japan and Europe refused to accept returning yen and euro assets desperately seeking shelter in panic. They are trying to accomplish it via QEs and NegIRP. They are trying to erect barrier to capital inflows in order to avoid surging of their currencies and killing their economies, meaning reminder of industries capable to export since domestic income and demand is dead
This leaves, commodity driven, emerging markets in conundrum. Their currency is weak vs. dollar but they do not trade that much with US to take any significant advantage (US is a significant exporter of commodities itself), but if currency of a country to which they sell is weaker than their currency vs. dollar, their sales collapse. And that’s really the case throughout the world. So they fight a currency war indirectly among themselves, through FX dollar, by collapsing their CB interest rates while facing collapse of their own currencies vs. dollar due to capital flight. All that against common wisdom, which would suggest rate hikes instead.
That’s why while 75% of world currencies lost to dollar, 75% of all worlds CBs lowered interest rate within in last 12 months and they keep lowering to out-export each other giving up on domestic demand and growth or even preventing any significant growth in first place to avoid their currency surge. Even China accepts much lower growth, to talk yuan down, and Russia lowered the interest rates twice while was under FX attack and massive capital outflows, and was happy with rubel about half of its value 12 months ago. And with Rubel gains this year so far, there is talk of further easing to keep it correlated with price of oil at 60 Rb level.
More recently Central Bank of Vietnam and RBA were other CBs to devalue their currencies, the only remedy possible for tens of central banks in the world, which already drop their interest rates within last 12 months in order to prevent further collapse of their export driven economies. More to follow.
To defend themselves many countries, also in the west, abandon FX market monopoly and set up huge currency swap lines, or join newly created independent of Washington and dollar, international financial institutions to limit this spiral of death. Ironically swap lines actually boosts dollar since in addition to non-US$ denominated capital flight into US$ assets, there is shortage of FX dollar funding since nobody needs to sell dollars to buy other currencies if they have swap lines, with “fixed” exchange rate, open. In strange ways globalization makes de-dollarization inevitable one way or another. Dollar strength is in part result of dollar shortage at FX but not because everybody wants dollars but because nobody needs it any more as intermediary in FX exchange because it is overpriced to its value. It is classical FX market failure, similar to that of 2008 when FED open massive swap lines with worlds CBs to squash dramatic raise in dollar.
See post and my comment at:
http://www.zerohedge.com/news/2015-03-08/global-dollar-funding-shortage-...
But why? What’s going on?
The general answer is that national economies and sovereign states (with few exception) are illusions. Their domestic markets are illusions, their economic and social policies are illusions maintained for domestic political audience. Global integration has been accomplished. Only global economy exists now. And unified global capital rules the world.
Production is distributed so much all over the world that no country controls production of nothing but some small subsystem, one of thousands parts from all over the world assembled in final product with no true ownership and no country of production. Just few multinationals are richer than GDP of at least bottom 120 countries in the world and have no national allegiance of any kind.
This serves purpose of practically eliminating any political leverage that country may have over world production. But now with ZIRP nobody has any leverage over global elites who print their profits. In other words countries (with few partial exceptions) cannot reestablish control over their economies and social policies by imposing tariffs, trade barriers, capital, labor controls, specific social, economic, military, foreign policies or whatever in any way that would not result in collapse of their “hollow” economies and painful political turmoil at least during transition.
Even countries at war cannot stop cooperating economically, close borders or limit civilian trade, thing unheard off 50 years ago. The unimpeded and even increasing cross border trade and people movement between Russia and Ukraine continues, Poroshenko candy factories in Russia are making profit while they are on war footing. US increased exports to Russia in last 12 months while spewing apocalyptic rhetoric of WWIII. Germany owned factories in Russia dramatically increased investment of their profits in Russia to avoid losses of manipulated currency play. And it paid off handsomely so far. These are examples of global integration paralyzing the social or international policies.
This has most corruptive influence of national politics. That’s why all politicians that promised economic growth, betrayed the people as soon as they got in power since they knew the only way to the growth in global economy is to export if not they have to cut expenses, collapsing governmental and private social programs and dismantling democratic institutions that still left, to pretend to pay un-payable debt.
The fallacy of debt based global economic system is only too apparent.
There is no way out of world pauperization and death spiral except to break through globalism in very painful ways. Unfortunately, people rather believe in illusion than face pain of reality and turn around to stop this genocidal system of alien class of global oligarchy directed towards human extermination, all other priorities rescinded.
For brief discussion of inflation/deflation as well as so-called “free” markets, benchmarks and indices I suggest fresh look at financial propaganda of deceit at:
https://contrarianopinion.wordpress.com/2015/01/29/invisible-hand-and-other-paranoid-delusions/
For those believing that economy is rational science and economic conditions are result of laws or rules of economy I suggest interesting read on wage economy at:
https://contrarianopinion.wordpress.com/2015/01/28/slaves-of-wage/
For some more background on Japan political and economic situation in historical context:
https://contrarianopinion.wordpress.com/2015/02/20/japan-miracle-that-wasnt/