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Recession Looms As Empire Manufacturing Collapse Show No Signs Of A Bounce

Tyler Durden's picture




 

Despite some strangely optimistic expectation of a -0.5 print, September Empire Manufacturing printed -14.67, showing absolutely no hockeynesian dead-cat bounce mean-reversion. Hovering at the worst levels since April 2009, the underlying data is a total disaster. New Orders remain firmly negative and inventories collapse (who could have seen that coming?), and even more concerningly, employment and average workweek plunged into negative territory for the first time in over a year.

 

 

The read through the inflation outlook and for jobs - non-hamburger flipping jobs that is - from this report was simply abysmal:

Price changes were quite modest. The prices paid index slipped to 4.1, its lowest level since the Great Recession. The prices received index dipped below zero, falling six points to -5.2 in a sign that selling prices declined. Labor market conditions worsened,
with declines in employment levels and hours worked. The index for number of employees fell below zero for the first time in well over two years, slipping eight points to -6.2, and the average workweek index dropped to -10.3.

There was no silver lining pretty much anywhere in either the 6 month outlook or the current conditions:

Worst of all: the optimism is now gone. From the report:

Indexes for the six-month outlook displayed less optimism about future conditions than in August. The index for future business  conditions fell ten points to 23.2.

 

 

Indexes for expected new orders and shipments dropped to similar levels, and the indexes for both  future prices paid and future prices received declined. The index for expected number of employees edged up to 7.2, while the index for future average workweek turned negative. The index for expected capital expenditures fell six points to 11.3, and the technology spending index dropped to 2.1, indicating that tech spending plans were essentially flat.

Simply put, this report suggests total carnage in the manufacturing sector and, just as we have pointed out (most recently here and here), the exuberant inventory over-accumulation of the past few years - from Fed-deluded malinvestment - is about to come crashing down.

Charts: Bloomberg

 

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Tue, 09/15/2015 - 08:50 | 6550020 buzzsaw99
buzzsaw99's picture

bullish

Tue, 09/15/2015 - 08:56 | 6550044 G.O.O.D
G.O.O.D's picture

#winning 

Tue, 09/15/2015 - 09:15 | 6550122 Money Counterfeiter
Money Counterfeiter's picture

DJIA  30,000

Tue, 09/15/2015 - 08:55 | 6550038 brucekeller
brucekeller's picture

It's war time, bitches.

Tue, 09/15/2015 - 08:57 | 6550051 G.O.O.D
G.O.O.D's picture

You go first 

Tue, 09/15/2015 - 09:01 | 6550068 brucekeller
brucekeller's picture

I'm too old now, bwahahaha

Tue, 09/15/2015 - 09:07 | 6550090 Oldballplayer
Oldballplayer's picture

Been there, done that.

The question is do we go for sand again?  Or more jungle?  Or do we go back to quaint towns that were rebuilt 70 years ago?  Clearly, they need some windows broken.

Tue, 09/15/2015 - 09:40 | 6550231 brucekeller
brucekeller's picture

We haven't done jungle in a while.

Tue, 09/15/2015 - 11:52 | 6550836 Caleb Abell
Caleb Abell's picture

"The question is do we go for sand again?"

 

The question is: if the only thing under Iraqi sand was more sand, would we have gone there at all?

Wed, 09/16/2015 - 06:39 | 6554359 o2sd
o2sd's picture

The question is: was it even worth going there for the oil?

 

Tue, 09/15/2015 - 08:55 | 6550041 MFL8240
MFL8240's picture

Laughable!

Tue, 09/15/2015 - 08:57 | 6550043 Grandad Grumps
Grandad Grumps's picture

Not sure what you are seeing, the 2nd derivative is quite bullish! Inventories are down.

Higher rates AHOY!!

Tue, 09/15/2015 - 08:56 | 6550045 Pliskin
Pliskin's picture

But stocks are still good right?

Tue, 09/15/2015 - 08:57 | 6550049 HardlyZero
HardlyZero's picture

Negative is Positive ?

2 more days.

Tue, 09/15/2015 - 08:58 | 6550055 Baby Eating Dingo22
Baby Eating Dingo22's picture

With fiat being pushed into a rabbit hole, why is gold not skyrocketing right now?

How long can they keep it down?

I guess the answer to this can be seen in how long they've kept stocks up

Tue, 09/15/2015 - 08:59 | 6550058 firstdivision
firstdivision's picture

Don't ask questions.  Just buy while you can.

Tue, 09/15/2015 - 09:08 | 6550096 nscholten
nscholten's picture

Quit worring about it, dude.  It will happen when it happens.

Tue, 09/15/2015 - 08:58 | 6550056 firstdivision
firstdivision's picture

Why do I feel like there is going to be a rate hike with all the bad data points saying otherwise?

Tue, 09/15/2015 - 09:01 | 6550062 stant
stant's picture

Because they have too, save the world or save thier ass, you know the answers

Tue, 09/15/2015 - 08:59 | 6550060 Dead Canary
Dead Canary's picture

I'm starting a Web site that sells bricks and mortor.

Tue, 09/15/2015 - 09:04 | 6550076 Falling Down
Falling Down's picture

The view from where I sit here in Rochester is looking pretty bleak.

Small contract shops which were still bullish 2-3 months ago, suddenly stopped hiring, ended expansion plans, etc. I really do think the shit show is unraveling.

I caught some TV over the weekend, and noticed that commercials for 2015 vehicles seemed to be abundant, even for this time of year. Saw maybe one commercial for 2016 vehicles, I think it was Ford trucks

Watch your six, shit might be getting real, finally.

 

Tue, 09/15/2015 - 09:18 | 6550139 BeansMcGreens
BeansMcGreens's picture

Here in North Carolina.

MillerCoors says it is closing down their Eden, North Carolina plant next September. This will result in the loss of 500 jobs and $1.4 million in water revenue.

Talking about beer here.

Also nephew was laid off of from Caterpillar as a welder in Sanford NC. They built skid-loaders.

Guess construction is down.

Tue, 09/15/2015 - 09:28 | 6550170 Falling Down
Falling Down's picture

I've heard Cat's plants in SC are not doing all that well, they're outside Columbia.

http://www.journalnow.com/business/blogs/millercoors-to-close-eden-brewe...

"Since the creation of MillerCoors seven years ago, volume has declined by nearly 10 million barrels," or the equivalent of a single plant's production, the company said. "This volume loss is due to a variety of factors, including economic challenges, an explosion of choice and fragmentation within the beer business, and a dramatic change in the way consumers engage with brands.

10M barrels is quite a drop in volume.

Tue, 09/15/2015 - 11:23 | 6550679 Not if_ But When
Not if_ But When's picture

Two Caterpillar plants near my home town in NH are shutting down and moving operations further south in the region to consolidate with another existing facility.

Tue, 09/15/2015 - 09:11 | 6550106 Jason T
Jason T's picture

Less than 2% of clothes are made in the USA today.  

50% were made in USA in 1990, 29% in 2000.  Today, less than 2%.

Gutted.

Tue, 09/15/2015 - 09:16 | 6550126 stant
stant's picture

Robots don't need cloths

Tue, 09/15/2015 - 09:16 | 6550129 pazmaker
pazmaker's picture

Off topic....I'm in HR..yes I know everyone hates us.   I have employee with a Black LIves Matter T-shirt today...I have had multiple people come in and complain about it.  Our vague gray policy says NO t-shirts with Offense language...   In today's PC world it seems like everything is offensive!!   I think I will put a sign on my door that says  WHAT DIFFERENCE AT THIS POINT DOES IT MAKE!"

Tue, 09/15/2015 - 09:32 | 6550202 corporatewhore
corporatewhore's picture

that shirt should not be in the office. Send the person home or offer them a suitable replacement to wear.

Tue, 09/15/2015 - 09:46 | 6550252 general ambivalent
general ambivalent's picture

'HR Lives Matter'?

Tue, 09/15/2015 - 10:43 | 6550520 pazmaker
pazmaker's picture

good one!!   All Lives Matter!

Tue, 09/15/2015 - 10:42 | 6550517 pazmaker
pazmaker's picture

It is in a warehouse pick pack environment.

Wed, 09/16/2015 - 06:42 | 6554366 o2sd
o2sd's picture

It's a physics t-shirt. Word order got jumbled. It should read Black Matter Lives!

 

Tue, 09/15/2015 - 09:24 | 6550162 mendigo
mendigo's picture

Oh that captain janet may drive a golden spike through the heart of this zombie financial monster. And mark her victory with a golden shower on the servers of mawah.

Tue, 09/15/2015 - 09:24 | 6550163 AbbeBrel
AbbeBrel's picture

"Do not worry", Bernspankellen was quoted, "the interest rates are in the grave but largely contained". Housing prices are unlikely unlikely unlikely. "I don't buy your premise", it was quoted, "it is pretty unlikely premise that any Central Bank can make mistakes".

Tue, 09/15/2015 - 09:30 | 6550183 rogerrabbithole
rogerrabbithole's picture

I'm long shovels and shovel ready jobs. 

Tue, 09/15/2015 - 09:36 | 6550217 gizmotron
gizmotron's picture

Our inventories our steady, but the world is melting down.

Tue, 09/15/2015 - 09:59 | 6550311 Johnny Caine
Johnny Caine's picture

I work in the Steel Industry and can tell you first hand that we are being anhililated. Personally I've lost about $35,000 dollars this year so far and expecting to lose another 10 to $15,000 more. Over the past 3 months I've averaged about what a fast food employee brings home. What they are doing is cutting us down to basically a janitorial position which is a pay cut of about 3 to $400 dollars a week and then they do plant shUT downs every few weeks and force us to take our vacation weeks so that the numbers look better. This is military industrial complex shit. We were told they weren't allowed to lay us off (by who??) even  if it means bleeding the place completely. The board of directors for this blood letting all serve on the big 500's boards they all are in on it. I think when this thing comes undone the state is not going to have enough funds to pay for the unemployment and they know it. Alot of guys making good money are going to be fucked for good, I'm talking losing everything. Personally I think the big reason for the hard core  2nd Amendment take down is that the Rulers know this shit and in a "Wild West" scenario big boys become targets. They are not lying when they say the plebes can't be trusted with a gun.

Tue, 09/15/2015 - 10:25 | 6550437 Herdee
Herdee's picture

Now part of the rust belt.

Tue, 09/15/2015 - 10:34 | 6550480 MSimon
MSimon's picture

My electronics magazines are half the size they were 12 months ago. That is a fair concurrent indicator. Ads go down when profits go down.

Tue, 09/15/2015 - 11:04 | 6550587 Phoenix901210
Phoenix901210's picture

How can you NOT buy in this market?

Tue, 09/15/2015 - 18:03 | 6552845 BettingTheFarm
BettingTheFarm's picture

Rate hike or not does not matter. It's only a sideshow to distract your attention from the fact that the collapse has accelerated tremendously. Remember collapse is not an event, but a process.

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