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CEO Economic Confidence Implodes, Drops To Lowest In Three Years

Tyler Durden's picture




 

What rate hike?

Following a relentless barrage of recessionary industrial and manufacturing data, moments ago the Business Roundtable released its latest, fourth quarter 2015 CEO Economic Outlook Survey, and it is an absolute disaster.

According to the report, for the third quarter in a row, CEOs expressed growing caution about the U.S. economy’s near-term prospects and indicated they are moderating their plans for capital investment over the next six months, according to the Business Roundtable fourth quarter 2015 CEO Economic Outlook Survey, released today.

The Business Roundtable CEO Economic Outlook Index – a composite of CEO projections for sales and plans for capital spending and hiring over the next six monthsdeclined 6.6 points, from 74.1 in the third quarter of 2015 to 67.5 in the fourth quarter.

 

This third consecutive quarterly decline brought the Index to its lowest level in three years. As shown in the chart below CEOs are as unconfident in the recovery as they were in late 2012. In other words, CEO confidence has just dropped to a level last seen when the Fed was about to unveil QE3.

 

In the past we have mocked the CEO roundtable's optimism on rising CapEx. The reason why is shown below.  For the first six months of 2016, CEO expectations for sales decreased by 3.2 points and their plans for capital expenditures decreased by 16.7 points. Hiring plans were essentially unchanged from last quarter when they declined by nearly 8 points.

Capex plans plunge:

 

Sales expectations tumble to three year lows:

 

And Employment - the divergence from the official NFP data is oddly disconcerting.

“Lower expectations for sales and investment reflect CEOs’ ongoing caution about the near-term prospects for U.S. economic growth,” said Randall Stephenson, Chairman of Business Roundtable, and Chairman and CEO of AT&T Inc. “Congress and the Administration need to work together to continue to fund the government, expand trade, agree on a long-term transportation infrastructure investment plan, reauthorize the U.S. Export-Import Bank and renew expired tax provisions.”

Or, best of all, just tell "Mr. Chairmanwoman to get to work," although a rate hike is probably not what they would like to see.

The survey’s key findings from this quarter and the third quarter of 2015 include:

About the Business Roundtable CEO Economic Outlook Survey

The Business Roundtable CEO Economic Outlook Survey, conducted quarterly since the fourth quarter of 2002, provides a forward-looking view of the economy by Business Roundtable member CEOs. The survey is designed to provide a picture of the future direction of the U.S. economy by asking CEOs to report their plans for their company’s sales, capex and employment in the next six months. The data are used to create the Business Roundtable CEO Economic Outlook Index and sub-indices for sales, capex and hiring expectations – diffusion indices that range between -50 and 150 – where readings at 50 or above indicate an economic expansion, and readings below 50 indicate an economic contraction. A diffusion index is defined as the percentage of respondents who report that a measure will increase, minus the percentage who report that the measure will decrease.

The fourth quarter 2015 survey was completed between Oct. 14 and Nov. 4, 2015. Responses were received from 140 member CEOs. The percentages in some categories may not equal 100 due to rounding. Results of this and all previous surveys can be found at www.brt.org/resources/ceo-survey.

 

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Tue, 12/01/2015 - 12:26 | 6861101 the grateful un...
the grateful unemployed's picture

time to up their dosage of captogan, financial jihadists

Tue, 12/01/2015 - 12:48 | 6861210 BullyBearish
BullyBearish's picture

Blow out Jobs Number from the BLS to negate all the "bad" news and keep the dose of castor oil coming...

Tue, 12/01/2015 - 12:26 | 6861102 NoDebt
NoDebt's picture

C'mon, baby!  Just one more month!  Hang in there, you can do it!  Then we all get PAID, bitchez.  Year end stock bonuses.  Come to pappa.

 

Tue, 12/01/2015 - 12:26 | 6861106 Dr. Engali
Dr. Engali's picture

Poppycock! Every CEO that comes on CNBS keeps going on about how fantastic the U.S eCONomy s doing. You're not suggesting these pillars of society are fibbing are you Tyler? 

Tue, 12/01/2015 - 12:43 | 6861177 KnuckleDragger-X
KnuckleDragger-X's picture

simple outlook on their part.... https://www.youtube.com/watch?v=uTmfwklFM-M

Tue, 12/01/2015 - 12:29 | 6861114 ebworthen
ebworthen's picture

No doubt the C-Suite will be giving itself generous Holiday bonuses.

Employees and shareholders to get a fruitcake with a pretty bow.

Tue, 12/01/2015 - 12:44 | 6861185 KnuckleDragger-X
KnuckleDragger-X's picture

"Fruitcake enema's for everybody!"

Tue, 12/01/2015 - 12:52 | 6861231 847328_3527
847328_3527's picture

Those complaing CEOs are just homophobicraycissnazihatemongertearrists.

 

 

Tue, 12/01/2015 - 12:30 | 6861121 Make_Mine_A_Double
Make_Mine_A_Double's picture

Given this is the most politicized Fed or all politicized Feds and the garden gnome is so obviously a political tool there will be no quarter point or any point raise in December or right thru the November election.

I love the Donkey rational through 'just hold off a little longer until we reach 'maximum' employment. ROTFLMAO.

I don't think the 'everything is awesome' meme can hold up too much longer, but we'll certainly get deludged with it all thru December.

Tue, 12/01/2015 - 12:31 | 6861125 sam i am
sam i am's picture

What difference does economy make any more?

 

Is Turkey Waging War on Russia in Crimea, the Caucasus, and Central Asia? Sputnik News Interviews Saker

http://thesaker.is/is-turkey-waging-war-on-russia-in-crimea-the-caucasus...

 

https://twitter.com/ScottsHumor/status/671727429023584257

Tue, 12/01/2015 - 12:35 | 6861141 pebblewriter
pebblewriter's picture

Nothing that a little rate hike delay can't cure...?

Tue, 12/01/2015 - 12:38 | 6861152 Cautiously Pess...
Cautiously Pessimistic's picture

Democrats working on giving Grandma Yellen some political cover for when she does not raise rates on the 16th.

 

http://www.politico.com/story/2015/12/economy-fed-janet-yellen-interest-rates-216272

Tue, 12/01/2015 - 12:42 | 6861173 Johnny Horscaulk
Johnny Horscaulk's picture

Oh theyre still gonna hike, boys and girls, just a cunt hair, and Goldman will reap most benefits then, and again when the rate is cut again and the printing presses set to 11.

Tue, 12/01/2015 - 12:47 | 6861176 White Mountains
White Mountains's picture

Wait 'till after Christmas when all those crap presents and ill-fittling clothes given as gifts are returned via "free" shipping back to the merchants for full refunds.  Many will just keep the cash - they are massively in debt and need every penny just to get by.

THEN we'll see what the REAL sales figures were.

Expect great bargains when all this stuff is put back on the rack.  Channels are stuffed, inventory is very high.  Too high. 

Also, many empolyers wait until after the holiday season to lay off.  Don't wanna be the Grinch.

Expect an interesting winter....

Tue, 12/01/2015 - 12:51 | 6861229 xyzcracker
xyzcracker's picture

Bullish talk

Tue, 12/01/2015 - 15:58 | 6862067 Eyeroller
Eyeroller's picture

THEN we'll see what the REAL sales figures were.

MSM will ignore the real figures. Unless, of course, it will be needed as a reason for the Ponzi Munchkin not to hike rates.

Tue, 12/01/2015 - 12:43 | 6861181 Charles Offdensen
Charles Offdensen's picture

How could ANY CEO have a positive outlook when with each passing year more people have to enroll in healthcare that costs more and more which sucks every last dollar they have out of their pocket to possibly spend on shit made from china?

But hey they might be able to scrape together a few bucks to go watch Leo Decrappio get raped by a bear on. Christmas Day!!!

http://drudgereport.com/now3.htm

For the record I tried.

Tue, 12/01/2015 - 12:47 | 6861207 Questan1913
Questan1913's picture

It looks as though the climate change liestream is about to collapse also:

 

https://market-ticker.org/akcs-www?post=230933

 

And let the hangings begin.......

Tue, 12/01/2015 - 12:53 | 6861232 847328_3527
847328_3527's picture

We need a heftier ClimateChangeHoax Tax.

Tue, 12/01/2015 - 13:11 | 6861323 THE COIN
THE COIN's picture

The Fed and Data Driven decisions. They probably would let the market drift lower than have a crash.

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