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Chicago PMI Plunges To Lowest Since November 2009, Biggest Miss To Expectations Since September 2009

Tyler Durden's picture





 

... the only question is whether the number,which printed at 56.2, down from 62.2, and missing expectations of 60.0, is horrible enough to send stocks soaring. Based on some of the core numbers it may be: the headline nuimber was the worst since November 2009, the miss was the biggest since September 2009, Production of 57.1 was the lowest since September 2009, New Orders slide to 57.4 from 63.3, Supplier deliveries lowest since September 2011, and so on. The only good print was employment which mysteriously rose from 56.3 to 58.7, just in time for the NFP print to come really, really ugly. On, and Joe LaVorgna was at 61.0: way to earn that bonus Joe. ISM downward revisions to come. But not from Joe- look for upward revisions there. Finally, comment #6 from the PMI respondents says it all: "Despite all of the rhetoric to the contrary, it looks like the air got let out of the balloon."

Source:

The most interesting part from the release, the survey respondents. #4 FTMFW. #6 and #9 are pretty good too.

  1. Seems there is a calm out there.
  2. Extensive off-shoring of manufacturing not without unseen cost. Apron strings are much harder to
    cut than originally anticipated. Improvements are often slow and painful. Yields far lower as a
    result. Tight inventories at suppliers continue to constrain inventory turn improvements by
    increasing risk of spike induced outages.
  3. High oil cost is creating a cost burden for inbound freight & higher material conversion costs. A
    sustained increase in the cost of oil (or staying high at the current cost) will have a negative
    impact on our business and the economy in general because goods and services will cost more and
    the population will have less to spend on those goods and services. Much of the oil rise seems to
    be speculation and is rooted in the fear of lack of supply rather than true supply and demand.
  4. Same, same.
  5. Generally seeing a positive trend in orders.
    Some supplier lead times are decreasing. Their backlog is decreasing as is ours.
    Automotive related orders have greatly increased from one year ago, but other areas of business
    appear to be softening.
  6. Despite all of the rhetoric to the contrary, it looks like the air got let out of the balloon.
  7. New orders down a little this month but testing & quoting is up. We are expecting a lot of orders
    in the near future.
  8. China inflation to hit in second Qtr.
  9. Lending is picking up but only to borrowers with stellar credit.
 


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Mon, 04/30/2012 - 10:05 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Who could have forseen?

My my, what a pickle we seem to suddenly be in. Time to call Ben.........again.

Mon, 04/30/2012 - 10:06 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Screw Ben....it's time to call Fox Force 5.

 

Mon, 04/30/2012 - 10:20 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Agreed. They are a force to be reckoned with.

http://en.wikipedia.org/wiki/Pulp_Fiction

 
"Fox as we're a bunch of foxy chicks. Force as we're a force to be reckoned with. Five as there's one ... two ... three ... four ... five of us." The Fox Force Five is a group of assassins, each with their own specialty. It first appeared in a dialogue in the movie Pulp Fiction. One can use this as a term of respect, irony or insult.

http://www.urbandictionary.com/define.php?term=Fox%20Force%20Five

Mon, 04/30/2012 - 10:56 | Link to Comment pods
pods's picture

Ketchup.

Mon, 04/30/2012 - 12:11 | Link to Comment TalkToLind
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Douglaswould you please pass the catsup?

Mon, 04/30/2012 - 11:05 | Link to Comment tempo
tempo's picture

27% miss on CA income tax collections ($6.7B vs $9.1 B). No one seems concerned out here.

Mon, 04/30/2012 - 11:33 | Link to Comment CH1
CH1's picture

No one seems concerned out here.

No one seems concerned about anything, anywhere.

All hail the entertainment corps!

Mon, 04/30/2012 - 12:33 | Link to Comment hedgeless_horseman
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http://www.buycaliforniabonds.com/index.asp

What could possibly go wrong?

Tue, 06/19/2012 - 11:15 | Link to Comment Nagelstudio
Mon, 04/30/2012 - 10:01 | Link to Comment Peter Pan
Peter Pan's picture

If this is the result with so much government deficit spending, what are we to expect if the USA is to ever adopt austerity?

 

Mon, 04/30/2012 - 10:08 | Link to Comment Red Raspberry
Red Raspberry's picture

a revolt I assume.

Mon, 04/30/2012 - 10:33 | Link to Comment Peter Pan
Peter Pan's picture

A successful one I hope, otherwise let's stick to deficit spending

Mon, 04/30/2012 - 18:08 | Link to Comment Things that go bump
Things that go bump's picture

The best chance since the Civil War to get this gorilla off our back. Maybe this time we can all secede.    

Mon, 04/30/2012 - 10:08 | Link to Comment GeezerGeek
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Since government spending (not to mention regulation) is a drag on economic activity, were the USA to practice austerity (meaning the government reduced spending to match income) I think the economy would improve a bit. If the EPA, FDA, OSHA, DHS, TSA, DoE (Education), DoE (Energy), etc. all took a year-long hiatus and no one enforced the rules the economy would recover even faster.

Think of the government metaphorically as friction. Friction impedes movement. Less friction begets easier movement.

Mon, 04/30/2012 - 11:05 | Link to Comment pods
pods's picture

Yeah, but using your analogy, that government deficit spending also acts as friction to that gigantic debt snowball rolling down the hill after us.

pods

Mon, 04/30/2012 - 11:26 | Link to Comment Debt-Is-Not-Money
Debt-Is-Not-Money's picture

 

 

Friction is to inertia

as

The Debt Snowball is to momentum

Ouch!

Mon, 04/30/2012 - 10:21 | Link to Comment LetThemEatRand
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If austerity is imposed for the banks and 1% who have great personal wealth in the stock market, a short period of pain then a turn around.   Otherwise, your question is already answered.   We already have austerity for the masses in the form of shrinking employment numbers, lower wages, shrinking home values, high cost of credit, etc.   The current non-austerity program is trickle down on steroids.  Because it worked so well the last 40 years, let's double down.

Mon, 04/30/2012 - 10:32 | Link to Comment GMadScientist
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Deflationary collapse.

Mon, 04/30/2012 - 10:43 | Link to Comment RoadKill
RoadKill's picture

You will see in about 3 months.

Take each country's GDP growth rate and subtract its government deficit as a % of GDP thats their Austerity growth rate. US economy would look EXACTLY like Euro zone if we ran a deficit of 3% instead of 10%.

Btw - props to the Repubs for passing the FICA tax cuts with no spendingg off set! Prevented them from getting creamed and brought the debt ceiling fight to right BEFORE the election instead of after. BRILLIANT maneuvoring. Maks my TZA pay off 6 months earlier. Gets the Tea Party reinvigorated. Makes the discussion all about the 6 trillion Obama has added to the debt in 4 years.

Problem is Im not sure I want Romney to win. Dont want him to get blamed with what is going to happen no matter who is in office. You can cut spending and watch us go into another recession or you can keep spending and watch us go bankrupt. Neither choice will get you reelected or let you keel the House and Senate.

Let Obama get reelected and watch him REALLY run us into the ground so that the libs are once and for all discredited as a political force in the country.

Mon, 04/30/2012 - 13:59 | Link to Comment Breaker
Breaker's picture

The next presidency may well be a poison pill. Whoever gets it will preside over a crash. A big one. Don't much like Romney. But, OTOH, having a hardcore socialist/fascist as president grabbing the opportunities created by a crash to centralize everything scares the pants off of me.

Mon, 04/30/2012 - 12:47 | Link to Comment Breaker
Breaker's picture

"...what are we to expect if the USA is to ever adopt austerity?"

A couple of really bad years and then a healthy recovery. Some president has to have Reagan's balls. Reagan put us thru two really bad years at the start of his first term with 18% home loans, high unemployment etc. He spent the political capital needed to reset the economy. The correct remedy today is drastic cuts in government spending. Romney doesn't, I think, have the cojones to do that. Obama has no desire to do it. So reality is going to have to create the austerity. At some point, it will.

The longer we put it off, the bigger the riots.

Mon, 04/30/2012 - 10:01 | Link to Comment lizzy36
lizzy36's picture

The last batch of economic numbers are not good for Obama.

So the issue is whether Bernanke does anything in June (has to be drop dead date pre-election) or sits on his hands?

Interesting times......

Mon, 04/30/2012 - 10:20 | Link to Comment sschu
sschu's picture

If Bennie does not start soon, then forget about it, not sure June is maybe too late.  If this was the game, they should have started back in January and they should have crushed the price of oil and PMs first.

The 8/80 theory may still hold, UE over 8% and WTI over $80 on September 1 and Bam is toast IMHO.

Makes one wonder why none of this has happened?  Maybe they have something else in mind, they couldn't pull it off, or the Bamster has worn out his welcome/is no longer useful to those pulling the monetary strings.

We could be looking at a September, 2008 rerun, the price of oil in early 2008 really hurt the economy.  Hope not.

sschu

 

Mon, 04/30/2012 - 10:33 | Link to Comment DeadFred
DeadFred's picture

The employment figures are easy since they are government generated, they will be what they are supposed to be. WTI under 80 is a pipe dream so they may want to sub in another figure, maybe S&P over 1500. The market is rising on nasty data, why? Where is the money coming from to drive these moves? Even with vapor volume it take real fiat (oxymoron?) to drive these moves.

Mon, 04/30/2012 - 10:01 | Link to Comment Silverhog
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Your the man Ben.

Mon, 04/30/2012 - 10:01 | Link to Comment Sudden Debt
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Oups.... What can I say...

Mon, 04/30/2012 - 10:02 | Link to Comment Hedgetard55
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No sweat, Ben has the market's back (and shorts' backsides).

Mon, 04/30/2012 - 10:02 | Link to Comment slackrabbit
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Krugman says this is bullish

Mon, 04/30/2012 - 10:03 | Link to Comment Fips_OnTheSpot
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WE DID IT!!

Mon, 04/30/2012 - 10:02 | Link to Comment TradingJoe
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Ben, Bubba, we're falling appart man! Do something, anything, but do it! And do it no later then June! :)))

Mon, 04/30/2012 - 10:07 | Link to Comment DormRoom
DormRoom's picture

Fiscal cliff Jan. 2013.   Let's see if American politicians can reach consensus before finanpocalypse.

Mon, 04/30/2012 - 10:10 | Link to Comment azzhatter
azzhatter's picture

oh, they'll come up with some completely nonsensical solution to all our problems. They'll cut $10 million in spending per year for the next 12 years and it will be hailed as a stick save.

Mon, 04/30/2012 - 11:36 | Link to Comment Debt-Is-Not-Money
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False-flag operation.

Body check!

Mon, 04/30/2012 - 12:01 | Link to Comment Things that go bump
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It'll have to be something really massive to distract attention from the death of the economy, something along the lines of a dirty suitcase bomb or a massive release of anthrax in a high population density area.  

Mon, 04/30/2012 - 10:09 | Link to Comment NERVEAGENTVX
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What does it matter? The economy could completely implode and the "numbers" would never reflect it.

DOW +100

Mon, 04/30/2012 - 10:07 | Link to Comment jus_lite_reading
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I see nothing but GREEN SHITS here...

Mon, 04/30/2012 - 10:09 | Link to Comment Village Smithy
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I would love to know more about the company that submitted comment #2. "Unseen cost" like "yeah, my wage costs are down but there's nobody left to buy my products, I wish I were Apple".

Mon, 04/30/2012 - 10:09 | Link to Comment azzhatter
azzhatter's picture

and rising employment?

Mon, 04/30/2012 - 10:10 | Link to Comment JasperNewtonDaniel
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And the market heads higher.  Reality has been suspended until the inevitable collapse.  That is all.  We now return you to the regularly scheduled farce.

Mon, 04/30/2012 - 10:09 | Link to Comment UTICA CLUB XX PURE
UTICA CLUB XX PURE's picture

The whole world is depressing me. Depressing news everywhere dovetailed by an almost assurance the Obama will win again and even if he does not it would them be Romney and that just makes me want to puke. Sure I'm stacking silver & thats great for me but what about America? What about our freedom? It seems the only happy Americans these days are the ones with their heads in the sand. It all sucks man... What are we to do??? Anyone??? 

Mon, 04/30/2012 - 10:18 | Link to Comment Ben Burnyankme
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Freedom?  What Freedom?

What was Winston Smith's solution?

Mon, 04/30/2012 - 10:16 | Link to Comment Ostapuk Ivano
Ostapuk Ivano's picture

Varick Street? I did the Utica club brewery tour. Good stuff

Mon, 04/30/2012 - 10:33 | Link to Comment Vince Clortho
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Spread the word to those people who "have their heads in the sand".

Mon, 04/30/2012 - 11:21 | Link to Comment Pooper Popper
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Lets have a big parade,with lots of glitter and leather!

Mon, 04/30/2012 - 10:10 | Link to Comment dwdollar
dwdollar's picture

QE3 rumor in 3, 2, 1...

Mon, 04/30/2012 - 10:11 | Link to Comment vincent van goo
vincent van goo's picture

Automotive related orders have greatly increased from one year ago,

 

Do not fully understand the Chicago PMI entails.  Would the bump in automotive come from sub prime car loans?

 

 

Mon, 04/30/2012 - 13:00 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

So have dealer inventories.......kooky how that works!

 

Mon, 04/30/2012 - 10:11 | Link to Comment Ostapuk Ivano
Ostapuk Ivano's picture

Is anyone worried about a May 1 terrorist attack? That whole bin laden anniversary thing?

Mon, 04/30/2012 - 10:33 | Link to Comment Ostapuk Ivano
Ostapuk Ivano's picture

Whats with the negative rating? I thought it was a legit questions.

Mon, 04/30/2012 - 12:17 | Link to Comment gdogus erectus
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Because fear is a control mechanism.  Keeps us begging for more drone killings and trillion dollar defense budgets that requires "us" to print money and pay interest to the borg.

Mon, 04/30/2012 - 12:44 | Link to Comment xela2200
xela2200's picture

Fear is a threat to freedom.

Mon, 04/30/2012 - 10:52 | Link to Comment El
El's picture

Worried about it? No. It never even crossed my mind. The only attempts at terrorist attacks we've seen in a decade are those instigated and assisted by the FBI so they can then turn around and proudly trumpet how they foiled another attack.

Mon, 04/30/2012 - 10:14 | Link to Comment Stackers
Stackers's picture

Long live the ZIRP. Just  bought me a Made in the USA John Deere tractor last week at 0%. Thanks Ben.

Ok it actaully was Assembled in the USA with Chinese made components and a Japanese diesel engine, but it is green and yellow and who's counting anyway. Oh wait, the PMI is.

Mon, 04/30/2012 - 10:22 | Link to Comment GOSPLAN HERO
GOSPLAN HERO's picture

John Deere tractors have good resale value.

Kubuto tractors are nice but lack good resale value.

 

Mon, 04/30/2012 - 10:33 | Link to Comment Stackers
Stackers's picture

And the Deere IS a better tractor. No doubts. And you really cant beat free fianacing. Hell backwards adjusting for inflation (lol) it's a hell of a discount off the list price.

Mon, 04/30/2012 - 10:18 | Link to Comment SmoothCoolSmoke
SmoothCoolSmoke's picture

"Sugar" Longs are rejoicing!.  These SOBs are the epitome of Big Govt Socialists.  Do not care about anything but sucking on the Fed teat.  While at the same time they bitch about folks getting food stamps!  What a bunch of greedy MFing hypocrits.

Mon, 04/30/2012 - 10:17 | Link to Comment Bansters-in-my-...
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Rally...rally Rally.........!!!

More cowbell

Mon, 04/30/2012 - 10:18 | Link to Comment Snakeeyes
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Ouch!

Mon, 04/30/2012 - 10:18 | Link to Comment NERVEAGENTVX
NERVEAGENTVX's picture

Can't figure out why they even bother releasing numbers that "miss expectations". Maybe it's to maintain the last vestage of credibility, or to keep the balls n the air a little while longer. Maybe a touch of both.

Mon, 04/30/2012 - 10:20 | Link to Comment Ben Burnyankme
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Ben's balls in the air.  Now that's a picture!

Mon, 04/30/2012 - 10:18 | Link to Comment UTICA CLUB XX PURE
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Yes Varick Street : )

 

Mon, 04/30/2012 - 10:26 | Link to Comment Ostapuk Ivano
Ostapuk Ivano's picture

I think Saranac Thursday is starting up soon. I used to hang out at the Varick and on dollar shot nights.

Mon, 04/30/2012 - 10:45 | Link to Comment Simulacra10
Simulacra10's picture

I can't remember who exactly it was that said this, but back in February they said that thre would be deflationary tail spin for a few weeks in commodities in April/May - then look out! As inflation will kick in. And IIRC they stoped just shore of calling inflation hyper-inflation. 

I'm thinking it was Jim Sinclair, Reggie Middleton, or Peter Schiff. Whoever it was was spot on for the deflationary timing.

Mon, 04/30/2012 - 10:52 | Link to Comment Snakeeyes
Mon, 04/30/2012 - 10:58 | Link to Comment El
El's picture

Of the stocks I follow, all are in the red except for GS and GSF. Imagine that.

Mon, 04/30/2012 - 11:10 | Link to Comment FreeNewEnergy
FreeNewEnergy's picture

Hey, at least the Chicago PMI is doing better than the Chicago Cubs, but that's not saying much.

Mon, 04/30/2012 - 11:45 | Link to Comment Shizzmoney
Shizzmoney's picture

Inflation already hitting China.  The pricing on the stuff I work on with vendors over there has already gone up 2-3%.

Mon, 04/30/2012 - 14:19 | Link to Comment pilager
pilager's picture

He is doing the best he can. His is so smart people don't realize how brilliant he is .... so far ahead of us all. So don't be scurrrrd people. Everything's cool.

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