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Charting Premature Jubilation - The US Economic Growth Momentum Is Now Over

Tyler Durden's picture




 

It is funny to hear the talking heads preface virtually every bullish statement with "the US economic data is getting better." It's funny because it's wrong. We have been tracking economic data based on our universe of indicators and as of today we have seen a miss rate of about 80%. And now, Deutsche Bank has joined us in keeping track of economic beats and misses, with their own universe of 31 economic indicators. The results are shown below and the verdict is in: the US economy has officially turned the corner... lower, now that the seasonally adjusted boost from a record warm winter fades and becomes an actual drag (not to mention the fading of the $2 trillion in central bank liquidity).

From DB:

As can be seen in the chart above, using this basket the beat:miss ratio for January was a fairly solid 55%:42% (3% in line) before improving to a strong 65%:35% in February. March, however, is seeing a rise in misses with the ratio now running at 37%:56% (7% in line) with 27 out of 31 releases now in. Regional manufacturing surveys and some housing related data are leading the misses in March. Indeed in February we saw all regional surveys (NY, Philly,  Richmond, Chicago Fed, Kansas, Dallas, Chicago PMI) better relative to market consensus. We will get the Kansas Fed data today and Chicago PMI tomorrow, but we have so far seen misses in Richmond, Chicago and Dallas Fed surveys this month. In terms of the housing market, existing home sales, the house price index, pending home sales, and new home sales all disappointed in March while all of these (except for new home sales) were better than expected in February...

Remember: we have been saying since December that 2012 is a carbon copy of 2011. As a reminder the market peaked in April 2011 after a virtually identical diagonal ramp higher, only to be followed by the August debt ceiling fiasco which sent stocks to their lows. And as we showed yesterday, this year we expect the debt ceiling to be breached in mid to late September. Just in time for the elections.

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Thu, 03/29/2012 - 10:21 | 2300439 kito
Thu, 03/29/2012 - 10:26 | 2300452 SilverIsKing
SilverIsKing's picture

Green shoots as far as the eye can see although when one looks through a pair of binoculars, all they can see is a steaming pile of dog shit.  Funny how that works.

Thu, 03/29/2012 - 10:34 | 2300492 Dr. Richard Head
Dr. Richard Head's picture

From those green shoots comes peas.  Eat your fucking peas!

Thu, 03/29/2012 - 10:39 | 2300515 Fukushima Sam
Fukushima Sam's picture

If this warm and dry weather continues then it seems likely we could be looking at real problems come harvest time...

Thu, 03/29/2012 - 10:47 | 2300537 Dr. Richard Head
Dr. Richard Head's picture

This hit/miss index is showing a frost is taking over those green shoots as well.

Thu, 03/29/2012 - 10:59 | 2300583 rosiescenario
rosiescenario's picture

"From the dung heap the lily grows".

Thu, 03/29/2012 - 20:34 | 2302385 RussellChester8
RussellChester8's picture

my friend's sister makes $74/hr on the computer. She has been out of a job for seven months but last month her check was $17871 just working on the computer for a few hours. Read more on this site .... http://bit.ly/wYpMrv

Thu, 03/29/2012 - 10:28 | 2300464 LawsofPhysics
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"Fed economist to soon meet with an unfortunate and untimely end" will be the next headline.

Thu, 03/29/2012 - 11:05 | 2300610 AN0NYM0US
AN0NYM0US's picture

here is the actual presentation from Emmons of the St Louis Fed on Mortgage Debt

 

http://www.mortgagebankers.org/files/Conferences/2012/Servicing/Servicin...

Thu, 03/29/2012 - 10:22 | 2300443 LawsofPhysics
LawsofPhysics's picture

A comparison of volume between 2011 and 2012 will be useful.  More HFT and Fed/PD traders in "control" now.

Thu, 03/29/2012 - 11:00 | 2300584 DeadFred
DeadFred's picture

All the index levels are now sitting on their trend lines. Each time this has happened in the last few months 'something' has magically appeared to ramp things back up. Will this time be different? The next 30 hours will tell. It has to break sometime, but when?

Thu, 03/29/2012 - 10:23 | 2300445 BudFox2012
BudFox2012's picture

You know things are getting bad when they lie on every indicator yet still miss their expections...

Thu, 03/29/2012 - 10:34 | 2300491 chunga
chunga's picture

LOL

...even their estimates on how wrong they always are aren't ever right.

Thu, 03/29/2012 - 11:02 | 2300591 tekhneek
tekhneek's picture

Fuckin' A right.

When you determine the score how bad do you have to suck at the game to get it wrong, time after time again?

Thu, 03/29/2012 - 11:10 | 2300632 MachoMan
MachoMan's picture

close enough for government work

Thu, 03/29/2012 - 10:25 | 2300448 ejmoosa
ejmoosa's picture

In 2009, year over year profits rose 6.29%

In 2010, year over year profits had risen 32.17%

In 2011, that rate of improvement was 7.91%.

 

Draw your own conclusions about whether or not the economy is getting stronger.

 

Thu, 03/29/2012 - 10:33 | 2300484 tmosley
tmosley's picture

And how do you think you know that?

Thu, 03/29/2012 - 11:03 | 2300593 ejmoosa
ejmoosa's picture

How?

 

Go to the BEA Report, and do a little math....

 

http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=43&ViewS...

Thu, 03/29/2012 - 12:30 | 2300940 toady
toady's picture

.gov says it all....

How can you tell if a politician is lying?

His lips are moving.

Or he's posting a paper on a .gov site!

Thu, 03/29/2012 - 10:54 | 2300548 Quinvarius
Quinvarius's picture

No they didn't.  When the government gives a bank money, or overpays a bank for worthless assets, it isn't a profit.

Thu, 03/29/2012 - 10:25 | 2300449 lolmao500
lolmao500's picture

Romney : closing factories and laying off thousands is funny

http://livewire.talkingpointsmemo.com/entries/romney-laughingly-recalls-...

At the outset of the call, Romney said he has some connections to Wisconsin.

“One of most humorous I think relates to my father. You may remember my father, George Romney, was president of an automobile company called American Motors … They had a factory in Michigan, and they had a factory in Kenosha, Wisconsin, and another one in Milwaukee, Wisconsin,” said Romney. “And as the president of the company he decided to close the factory in Michigan and move all the production to Wisconsin. Now later he decided to run for governor of Michigan and so you can imagine that having closed the factory and moved all the production to Wisconsin was a very sensitive issue to him, for his campaign.”

Romney said he recalled a parade in which the school band marching with his father’s campaign only knew the Wisconsin fight song, not the Michigan song.

“So every time they would start playing ‘On Wisconsin, on Wisconsin,’ my dad’s political people would jump up and down and try to get them to stop, because they didn’t want people in Michigan to be reminded that my dad had moved production to Wisconsin,” said Romney, laughing.

What a piece of shit.

Thu, 03/29/2012 - 10:33 | 2300485 Dr. Engali
Dr. Engali's picture

Looks like a Romney lover junked you. The issue that you point out is why Obummer is going to be reelected if Romney is the nominee. The "Mr. Wallstreet" will catch up with him.

Thu, 03/29/2012 - 10:36 | 2300502 lolmao500
lolmao500's picture

Obama and Romney are total trash and shouldn't be elected.

Thu, 03/29/2012 - 10:42 | 2300521 Dr. Engali
Dr. Engali's picture

   +1

Thu, 03/29/2012 - 10:48 | 2300539 Things that go bump
Things that go bump's picture

Yes, but which piece of trash do you prefer?

Thu, 03/29/2012 - 11:10 | 2300635 lolmao500
lolmao500's picture

Whoever people hate the most.

Thu, 03/29/2012 - 10:42 | 2300523 Dr. Richard Head
Dr. Richard Head's picture

Regardless of Newt Romtorum or Obama residing in the Oval Orifice Office, the story will remain the same.  Debt will expand exponentially, wars will be fought over resources, and the assmuncher media will do their best to split the population into arguing over red team/blue team, white/black, poor/rich, welfare/tax payer and the vast majority will eat it up or ignore it all together.  The story remains the same. 

Thu, 03/29/2012 - 10:47 | 2300536 Dr. Engali
Dr. Engali's picture

You're preaching to the choir brother. The people who need conversion are the reds and the blues.

Thu, 03/29/2012 - 10:49 | 2300543 Dr. Richard Head
Dr. Richard Head's picture

After over 5 years of trying to preaching to the red and blue team members, I have decided that giving myself my own root canals is much more pleasurable and actually gives me quantifiable results.

The blue teams tell me, "There is this pile of money...." Red team tells me "The debt is a problem unless we need to bomb brown people...." 

Thu, 03/29/2012 - 10:58 | 2300578 Dr. Engali
Dr. Engali's picture

I feel your pain there. The only caveat I have is that both sides are okay with bombing brown people...as long as it is their side dropping the bombs.

Thu, 03/29/2012 - 13:17 | 2301096 OpenThePodBayDoorHAL
OpenThePodBayDoorHAL's picture

Actually the US wars are not about resources any more, as Paul Craig Roberts points out. It used to be that empires went to war to extract resources from other countries. But the US did not win any resources from Iraq or Afghanistan. The resource that was won, bigtime, was taxpayer money flowing to military/corporate coffers. It's not required to "win" a war like that...just to keep it going.

http://www.counterpunch.org/2012/03/27/how-the-new-american-empire-reall...

Thu, 03/29/2012 - 10:57 | 2300569 Quinvarius
Quinvarius's picture

I am sure the only song they new was the Wisconsin fight song and that was not being done purposely.

Thu, 03/29/2012 - 10:36 | 2300451 DormRoom
DormRoom's picture

US GDP growth is not strong enough to pay off debt in the long term.  Fed cannot print before Israel bombs Iran.  QE stimulus before this event will be offset by oil spikes; also adding accelerant to oil speculation.

 

Will the Fed wait on QE until after Isreal bombs Iran?

 

Also, another QE may push USDJPY below 75, and ruin Japan's economy.  Japan goes, global economy goes.

 

Debt Jubilee.  War with China coming within 5 years.

 

 

Thu, 03/29/2012 - 11:13 | 2300643 Debt-Is-Not-Money
Debt-Is-Not-Money's picture

DR,

"another QE may push USDJPY below 75, and ruin Japan's economy"

Japan's economy (post Fukushima) and soon ours are already ruined. The twitching does not mean were still alive.

"War with China coming within 5 years" We have been at war with Red China (an economic war) since we started "trading" with them. I assume you are talking about a shooting war? Just wait until the Zionists attack Iran...

Thu, 03/29/2012 - 10:26 | 2300454 Dr. Engali
Dr. Engali's picture

Looks like old Benny better start floating some rumors either that or Obummer needs to launch his distraction.

Thu, 03/29/2012 - 10:29 | 2300465 stickyfingers
stickyfingers's picture

Many earnings estimates that "beat", were on lower forecasts.

Thu, 03/29/2012 - 10:38 | 2300510 Ahwooga
Ahwooga's picture

Yep, I would be very interested in a comparison chart showing beat/miss ratio on intial earnings estimates. Anyone out there been keeping that data or know where it could be tracked down?

Thu, 03/29/2012 - 11:06 | 2300615 ejmoosa
ejmoosa's picture

Estimates are not worth anything.  You are really just evaluating how good the guesses are versus how well the economy is performing.

 

Only 63% of companies are reporting higher earnings than the same quarter one year ago.  Last summer we were at 72%.

 

And the rate of improvement has dropped sharply.The most recent quarter up less than 6 %.  Last summer, the rate of improvement was more than 12 %.

Thu, 03/29/2012 - 10:31 | 2300475 disabledvet
disabledvet's picture

I do agree the US economy is slowing. Also ECRI still stands by its recession call...which is a bigger deal than "slowing." moreover "stocks markets don't go to zero" because of "slowings"...unless you are Spain apparently. "all heat and no light" as they say. The real question to chew on is "is 200 dollar a barrel oil in fact GOOD for the American economy?" History states "it is an axiom that high oil prices doom the US economy." What if history is wrong this time though? What if indeed "this time is truly different"? (must be all that Government help finally paid off er... I mean "paying off"... of course. Besides only an idiot in the world of finance would want a solution to America's dependence on oil, right?)

Thu, 03/29/2012 - 10:33 | 2300487 Al Huxley
Al Huxley's picture

This could all be fixed if they'd just make up some more positive numbers.

Thu, 03/29/2012 - 10:35 | 2300489 the not so migh...
the not so mighty maximiza's picture

I can't see them holding this all together till the elections or selections whetever it is. .

Thu, 03/29/2012 - 10:36 | 2300505 mayhem_korner
mayhem_korner's picture

 

 

The bubble gum & chicken wire have reached their half-life.

Thu, 03/29/2012 - 10:45 | 2300533 Dr. Richard Head
Dr. Richard Head's picture

I just identified the problem the US is having structurally based on the materials used to patch this economy up.  They have been using chicken wire and bubble gum, whereas duct tape and permanent marker proves to be much more effective. 

Thu, 03/29/2012 - 10:34 | 2300490 Hansel
Hansel's picture

Bullish.

Thu, 03/29/2012 - 10:38 | 2300508 BlueCollaredOne
BlueCollaredOne's picture

What do you say we settle this on the runway Han Solo?

Thu, 03/29/2012 - 10:35 | 2300494 the 300000000th...
the 300000000th percent's picture

It amazes me that they were able to hit any numbers based on lies, fuzzy numbers, BLS fraud, channel stuffing. Well iguess it depends on who "they" are.

Thu, 03/29/2012 - 10:41 | 2300517 mayhem_korner
mayhem_korner's picture

 

 

"Hitting" a number is simply a function of the time frame over which they can amortize the spread between the lie and reality.  I think that's what their ivy league PhD math doods do.

Thu, 03/29/2012 - 10:35 | 2300495 mayhem_korner
mayhem_korner's picture

It's funny because it's wrong.

 

Usually things are funny because they're true.  This must be more of a Joe-Pesci-in-Goodfellas kind of "funny"...

Thu, 03/29/2012 - 10:36 | 2300501 Tyler Durden
Tyler Durden's picture

It's also funny cause it is Bizarro day.

Thu, 03/29/2012 - 10:43 | 2300524 mayhem_korner
mayhem_korner's picture

 

 

You ought to come up with a name for the miss:hit ratio - maybe the Farce Index or sumpin.  Could be some royalties in it for the Tylers.  :D

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