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US Recession Imminent As Factory Orders Plunge For 8th Consecutive Month

Tyler Durden's picture




 

For the 8th month in a row, US factory orders fell YoY. Down 6.2% in June, this is the longest streak of declining factory orders outside of a recession in history. MoM, factory orders rose 1.8% - as expected - the most since May 2014 but historical orders and shipments were revised lower. Much of the MoM gain was driven by a 21% rise in defense aircraft shipments. Inventories contonue to rise leaving inventories-to-shipments ratios at cycle highs.

 

 

 

Would have been considerably worse if not for a 21% rise in Defense aircraft orders... thank the Keynesian gods for war!!!

 

Charts: Bloomberg

 

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Tue, 08/04/2015 - 10:10 | 6389131 JustObserving
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US Recession Imminent

Let's not forget that US inflation numbers are completely fake - so real US GDP is much, much lower.  We have been in a recession or depression since 2008:

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...

Tue, 08/04/2015 - 10:14 | 6389150 duo
duo's picture

If one used real inflation numbers, the economoy is 20-25% smaller than it was in 2000, let alone 2007, with maybe only one real positive GDP year, 2005 or 2006, at the height of the housing  bubble.

Tue, 08/04/2015 - 10:17 | 6389158 New England Patriot
New England Patriot's picture

I didn't realize imminent meant going back seven years. 

Tue, 08/04/2015 - 10:23 | 6389174 StackShinyStuff
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No no no no no NO GODDAMMIT!  It's bullish.  Always is.   Always will be.  Just BTFD.

Tue, 08/04/2015 - 10:33 | 6389214 nuubee
nuubee's picture

So I had doubts about Shadowstats, want to believe it, but have doubts. The chapwood index, however, I have a lot of trouble disbelieving. If that index is correct, then we truly have been in a depression since 2007/08. So, presuming we've been hiding our depression since then... to what ends? It seems the world was actually going fine for a while under the pretense of U.S. "Recovery", but if we hit another recession here I presume that lie will be laid bare for all to recognize.

So, to what end are we hiding our next-great-depression state?

Tue, 08/04/2015 - 10:38 | 6389230 New England Patriot
New England Patriot's picture

Keeps the guillotines quiet.

Tue, 08/04/2015 - 10:41 | 6389249 nuubee
nuubee's picture

The longer you lie to people, the greater their wrath.

Tue, 08/04/2015 - 10:46 | 6389260 gatorengineer
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no just the more extreme reality TV that you need to keep them occupied.  It will be interesting to see what they do to top Kaitlyn....

Tue, 08/04/2015 - 11:27 | 6389467 Save_America1st
Save_America1st's picture

The recessions have never ended...everything is fake and propped up with more debt.  This is a massive depression masked over by QE, EBT, and lies upon more lies of every economic statistic imaginable.

 

Tue, 08/04/2015 - 10:48 | 6389271 r101958
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Nuubee - Shadowstats is correct too.

Tue, 08/04/2015 - 10:51 | 6389283 nuubee
nuubee's picture

I'm not saying they're not, but their method makes it harder to believe them. Chapwood, however, puts the lie to power in a nearly impossible-to-deny fashion.

Tue, 08/04/2015 - 11:50 | 6389647 r101958
r101958's picture

Yes. John Williams does go into detail. He explains about hedonics etc., and yes it is difficult to fathom but we can blame the government for that. Incredibly, the govt says that when steak gets too expensive we will buy ground beef and therefore it is not considered inflation.

Tue, 08/04/2015 - 12:16 | 6389792 robertsgt40
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1958--so who can now afford ground beef/mystery meat/pink slime?

Tue, 08/04/2015 - 10:37 | 6389233 BandGap
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Gosh, who got elected in 2008? Who promised to fundementally change things?

When you want to collapse a system it's best to blow sunshine uppeople's asses until you don't. It increases the shock and the willingness to do anything to restore "order".

We've been off the cliff since late 2008. Time to hand over the anvil.

Tue, 08/04/2015 - 10:46 | 6389261 firstdivision
firstdivision's picture

Don't need an index to tell me we never recovered from '08.  Just drive around with eyes wide open.

Tue, 08/04/2015 - 10:49 | 6389278 nuubee
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I completely agree. I've lived in Southern California for 30 years now. The businesses that folded as a result of 2007/08 are *still* gone, those buildings they occupied are *still* empty. This has literally been normalized to this point. Even in wealthier areas, I see whole blocks that had luxury auto dealerships that have been closed for nearly a decade now. The numbers are a lie, no doubt.

Tue, 08/04/2015 - 11:20 | 6389420 Temporalist
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But you aren't counting all the Quinoa and Kale sandwich shops that opened named after Obama and Hillary.

Tue, 08/04/2015 - 20:49 | 6391875 Chuck Walla
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I remember seeing 3 blocks of dealerships all gone near San Bernardino about 3 years ago. It opened my eyes even wider than they were. If you can't sell cars in SoCal, there's a problem.

 

FORWARD SOVIET!

Tue, 08/04/2015 - 11:50 | 6389643 malek
malek's picture

So you're now stating what I already read between the lines for many posters here.

Can you elaborate why you found/find Shadowstats hard to believe or had doubts, but Chapwood not so much?
Because except that there are now two voices instead of a lone one, I am stumped at the perceived difference.

Tue, 08/04/2015 - 10:28 | 6389192 falconflight
falconflight's picture

I don't see why the OnePartyMedia just can't continue to claim recovery regardless of what some stats purport.  Many of the most important indicators (Labor Participation Rate, Median Income, Unemployment rate (1980 methodology), hasn't supported a recovery for 6 years and yet a sizable minority (Maybe 40%) actually believe Obama and Co has saved us from GW's "Great Recession."  I suppose if a GOProg wins the Maximum Leader position in Nov16, a recession/depression will be announced shortly thereafter...

Do you renounce you pledge of allegiance to the Fascist-Socialist Republic?

Tue, 08/04/2015 - 10:50 | 6389207 cowdiddly
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They called the last one "The Great Depression". This one has be labled as "The Great Perpetual Recovery". Perception MGNT 4401, thats upper level to you freshman and sophomoric dwebs. It has prerequisite requirements of Math 3341: Gobbels Statistical Modeling and COMM: 4201 Advanced  Propaganda Techniques. Now get another student loan and shut up and sign here.

Tue, 08/04/2015 - 11:52 | 6389660 malek
malek's picture

Not quite.

They called it depression at the time to downplay it as minor compared to regular recessions.
It only was named Great Depression after it had ended.

Tue, 08/04/2015 - 11:33 | 6389521 doctor10
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"defense aircraft shipments"

at some point you gotta export stuff that contributes to a growing, developing world, rather than blowing up the world.

demand is pretty limited longterm otherwise!!

 

just sayin'

Tue, 08/04/2015 - 10:30 | 6389135 Dr. Engali
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Oh, we're upgrading from a depression to a recession?  Finally some good news.

Tue, 08/04/2015 - 10:10 | 6389136 ajkreider
ajkreider's picture

What's the statute of limitations on "recession imminent"?

Tue, 08/04/2015 - 10:10 | 6389137 pods
pods's picture

We don't have to make anything anymore. We have facebook.

*like*

pods

Tue, 08/04/2015 - 10:26 | 6389187 SWRichmond
SWRichmond's picture

Pods,

We make war.  And bubbles.  That is all.

Tue, 08/04/2015 - 11:36 | 6389534 Kprime
Kprime's picture

we throw sand in the sand box and blow bubbles with bubble mix we stole from the other kids at school.

Tue, 08/04/2015 - 10:13 | 6389145 Bill of Rights
Bill of Rights's picture

Why didn't I get my  " Before Leahman "

Tue, 08/04/2015 - 10:16 | 6389155 dcohen
dcohen's picture

Let's pretend it matters

Tue, 08/04/2015 - 10:18 | 6389162 youngman
youngman's picture

Those new f35s are ready to go..so that is the payday I bet...

Tue, 08/04/2015 - 10:29 | 6389198 SWRichmond
SWRichmond's picture

You mean those F35's which lose dogfights to 30 year old F16's?  You mean the $1 Trillion F35 program that was an epic boondoggle?

Tue, 08/04/2015 - 10:34 | 6389211 New England Patriot
New England Patriot's picture

That's what happens when you build an F-105 Thunderchief with curves.

Tue, 08/04/2015 - 11:06 | 6389358 pods
pods's picture

I got stuck on that link for a half hour. Good stuff!  

pods

Tue, 08/04/2015 - 11:07 | 6389366 New England Patriot
New England Patriot's picture

They're the best.

Tue, 08/04/2015 - 10:19 | 6389165 surfersd
surfersd's picture

It is not a deflationary cycle it is a free money cycle. When money is free you can drill mine explore to your hearts content. When demand falls there is no place for all that newly produced commodity to go except down. Oops. Can't wait to see the jobs reports out of the Bakken. At least the McDonald's worker (if even he is still employed) will be making $15 hr.

Tue, 08/04/2015 - 10:23 | 6389176 dobermangang
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It's the Obama economy..... This year is worse than last year, but much better than next year.

Tue, 08/04/2015 - 10:39 | 6389243 Sir SpeaksALot
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exactly, when it comes to unfavourable categories - we should be comparing to next year, this way it will be very good for quite a long time.

Tue, 08/04/2015 - 10:25 | 6389180 Bell's 2 hearted
Bell's 2 hearted's picture

core capital goods orders revised down - again - from advance report (out july 27th)

 

Advance Core durable orders

 

april ... -0.7%

may ... -0.4%

june ... +0.9%

 

Full report (todays)

 

april ... -0.7%

may ... -0.8%

june ... +0.7%

Tue, 08/04/2015 - 10:25 | 6389182 Hunter S. Thompson
Hunter S. Thompson's picture

Does this mean a September Rate Hike?

Tue, 08/04/2015 - 10:26 | 6389186 Truth Eater
Truth Eater's picture

What is it- 3 quarters down before they declare "recession"?  And that was 8 months for June.  We just finished July.  We are HERE and we are just waiting for the liars to tell us where we are. 

They fake numbers so that even a dead company will have high stock values right up to the day its doors are locked in bankruptcy.

Tue, 08/04/2015 - 10:27 | 6389188 TheRideNeverEnds
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Netflix doesnt need factories.  

 

buy buy buy!

Tue, 08/04/2015 - 10:29 | 6389197 dcohen
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Netflix, Facebook, Google, Amazon need retards, and there are plenty of those around.

Tue, 08/04/2015 - 10:29 | 6389199 dontgoforit
dontgoforit's picture

Things are great.

Tue, 08/04/2015 - 10:55 | 6389300 Winston Churchill
Winston Churchill's picture

If you can't take a bad joke, you shouldn't be in manufacturing.

Thank dog I sold out in the 1980's.

Now I've got,no inventory, little overhead, and a booming biz in the middle of a depression.

Whats not to like ?

Tue, 08/04/2015 - 10:29 | 6389200 dobermangang
dobermangang's picture

It could be worse.  They're running out of beer in American liberals favorite socialist country.

http://www.theguardian.com/world/2015/jul/31/beer-shortages-loom-in-vene...

http://pjmedia.com/richardfernandez/2015/08/03/reinforcing-failure/

Tue, 08/04/2015 - 10:30 | 6389203 madcows
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Markets are up based on M-o-M.

Tue, 08/04/2015 - 10:30 | 6389204 WTFRLY
WTFRLY's picture

Civil War 2 is right on time

Tue, 08/04/2015 - 10:35 | 6389220 Jethro
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The Revolutionary War could be considered a civil war.  But what Yankees refer to as the Civil War was actually the War of Northern Aggression, as the South didn't try to topple the remaining government in the US, but sought to rule themselves as the CSA.

Tue, 08/04/2015 - 10:36 | 6389226 Ghordius
Ghordius's picture

I'll believe it when I see it

pardon my French, but imho it's mostly propaganda. specifically, so that a one-trillion-per-year "US Homeland Security" had a very little shred of fig leaf to hide behind

"support Homeland Security, yell the terrorist/rebel yell" could be the unofficial motto

just an alien/foreign opinion, mind you

Tue, 08/04/2015 - 10:32 | 6389213 Sir SpeaksALot
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hasnt US been in recession for last 5 years?

Tue, 08/04/2015 - 10:34 | 6389216 Chuck Knoblauch
Chuck Knoblauch's picture

I wouldn't worry about facts right now.

Tue, 08/04/2015 - 10:35 | 6389219 buzzsaw99
buzzsaw99's picture

an official recession concurrent with zirp. this should be fun. zee recovery with qe infinity. what a world.

Tue, 08/04/2015 - 10:37 | 6389227 starman
starman's picture

Me thinks consumers is saving to buy million bucks crap shack. It used to take 10 years to save to buy but with today's prices its 50!

Tue, 08/04/2015 - 10:37 | 6389234 Thisisbullishright
Thisisbullishright's picture

Crash already!!  FUCK!

 

Tue, 08/04/2015 - 10:48 | 6389269 lehmen_sisters
lehmen_sisters's picture

I tell people we are in a depression, have been for a while. The EBT cards are the new bread lines. 

Tue, 08/04/2015 - 11:33 | 6389511 corporatewhore
corporatewhore's picture

visit walmart.

that will make the most bullish recognize depression.

Tue, 08/04/2015 - 10:52 | 6389286 corporatewhore
corporatewhore's picture

did anyone between 1929 and 1939 call it a depression? or was it referred to as a recession just like this depression is (since we can't handle the truth)?

Tue, 08/04/2015 - 10:53 | 6389289 ignorethisuser
ignorethisuser's picture

BULLISH

(For a global financial meltdown this Sept/Oct.  Warning: May cause increased chances of riots, martial law, tyranny, unconstitutional actions, and/or civil war.  Your nation's results may vary)

Tue, 08/04/2015 - 10:54 | 6389293 Glass Seagull
Glass Seagull's picture

 

 

Inventory stocks are too high, I would welcome this deceleration of factory orders in order to balance.  Capacity utilization declines more, need to move the excess inventory with discounts.

 

 

Tue, 08/04/2015 - 11:21 | 6389429 Winston Churchill
Winston Churchill's picture

You need to raise your IQ above room temp. or you missed the /s tag.

Let the layoffs begin, even with zirp its the only way out for the CFO's.

Tue, 08/04/2015 - 10:55 | 6389301 gatorengineer
gatorengineer's picture

There never will be an official recession again.  The Fed will hold or ease not based on US numbers but due to foreign headwinds.

The US will in the next few months more actively try and pick a war, weather Iran, Korea, Ukraine, or possibly Syria remains to be seen.

If we want to go big we will go Chinese Islands, but I dont think the Obamator and the libtards have the stomach for that.

Tue, 08/04/2015 - 11:02 | 6389339 arbwhore
arbwhore's picture

ZH should also comment on the news today about robust auto sales for July (hint: debt) and the $3.9b dividend Fannie Mae is paying to the Treasury (hint: even less bonds to be issued).

Tue, 08/04/2015 - 11:05 | 6389353 orangegeek
orangegeek's picture

DO YOU SEE WHAT YOU HAVE DONE YELLEN!!????  NICE JOB ASSHOLE!!!

Tue, 08/04/2015 - 11:11 | 6389381 wmbz
wmbz's picture

Clearly we need to increase "defence" spending since that is saving us right now.

Or just wait for the Cackling Cunt to ride in on her broom in 2016... That will fix it, once and for all.

Tue, 08/04/2015 - 11:13 | 6389395 arrowrod
arrowrod's picture

Auto sales are up!

After they were down. 

Gasoline is down, after it was up.

I'm older.  Been told that I have to eat like I'm starving and exercise like I'm a coolie.  WTF?

Oh, and ride a bicycle everywhere.

And start throwing away all of my "stuff".

 

Things must be bad though, because everybody is fat.  'Cause they eat too much.

Tue, 08/04/2015 - 12:08 | 6389589 Kprime
Kprime's picture

Where have all the workers gone? Long time passing

Where have all the workers gone? Long time ago

Where have all the workers gone?

Gone to welfare every one

Now they don’t have to earn

Now they don’t have to earn

 

Where have all the taxpayers gone? Long time passing

Where have all the taxpayers gone? Long time ago

Where have all the taxpayers gone?

Gone to black-markets every one

Now they don’t have to pay

Now they don’t have to pay

 

 

Tue, 08/04/2015 - 11:49 | 6389633 fowlerja
fowlerja's picture

Looking at the chart...is this when I should buy "on the dip"?

Tue, 08/04/2015 - 13:25 | 6390198 kw2012
kw2012's picture

In all the other recessions the Fed lowered interest rates, what are they going to do this time when already at zero?

Tue, 08/04/2015 - 13:23 | 6390187 kw2012
kw2012's picture

Nothing a triple seasonal adjustment can't handle! From the bureau of truth

Tue, 08/04/2015 - 14:41 | 6390621 Westcoastliberal
Westcoastliberal's picture

Anyone who owns & operates a small business knows we've been in recession/depression since Q4 2007.  Yes there have been a couple of weak bounces up, but generally business volume is a shadow of its former self.  Right side up, but running on fumes here.

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