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CPI Comes In Line, Permits Miss, Housing Starts Better Than Expected As Multifamily Units Come At Highest Since September 2008
Unlike yesterday's PPI which surged past even the highest expectations, the September CPI came right in line, rising by 0.3%, just as predicted, and down from 0.4% in August. The index for all items less food and energy increased 0.1 percent in September, its smallest increase since March. The index for apparel declined in September after a series of sharp increases, and the indexes for used cars and recreation turned down as well. The indexes for new vehicles and household furnishings and operations were both flat. The shelter index rose, but posted its smallest increase since April, while the indexes for medical care, airline fares, and tobacco all increased. And in crawling along the bottom news, Housing Starts soared by 15% to 625,000 from a revised 572K and well above expectations of 590K. That this number was not as strong as headlined, is that it was driven exclusively by multi-family units (5+) which came at 227K, a surge from the 148K in August, and the highest since September 2008 - think of this as the inventory boost to GDP numbers. Since these numbers have been crawling at the bottom for years, and all moves are merely kneejerk reactions, in this case to accrued buildup following a weak summer season, it should be largely ignored (or else interpreted as a build up of unnecessary inventory: remember that whole foreclosure halt?), especially since Housing Permits of 594K missed expectations of 610K, and declined from a revised August print of 625K. Lastly completions were basically unchanged at 647K compared to 634K in August. Summarizing it all? Noise.
On CPI:
Total housing starts:
And Housing Starts for 5 or More Units:
And some more details from the CPI report:
Food
The food index, which rose 0.5 percent in August, increased 0.4 percent in September. The index for food at home repeated its July and August increase of 0.6 percent. The index for nonalcoholic beverages was unchanged, while the remaining major grocery store food groups all posted increases. The dairy and related products index rose the most, increasing 1.2 percent, followed by 0.9 percent increases in both the cereals and bakery products index and the fruits and vegetables index. Within the latter group, the indexes for apples and tomatoes both posted significant increases. The index for meats, poultry, fish, and eggs rose 0.4 percent as the index for eggs rose sharply, and the index for other food at home rose 0.6 percent. The food at home index has now risen 6.3 percent over the past 12 months with the dairy index up 10.2 percent over that period. After rising 0.4 percent in August, the index for food away from home increased 0.2 percent in September and has risen 2.6 percent over the last 12 months.
Energy
The energy index rose 2.0 percent in September after a 1.2 percent increase in August. The gasoline index, which was up 1.9 percent in August, rose 2.9 percent in September. (Before seasonal adjustment, gasoline prices fell 0.7 percent in September.) Over the past 12 months, the gasoline index has increased 33.3 percent. The household energy index also rose in September, advancing 0.7 percent after a 0.4 percent increase in August. The electricity index advanced 0.7 percent while index for natural gas rose 0.8 percent; the fuel oil index declined 0.7 percent. Over the past year, the household energy index has increased 3.7 percent. The electricity index has risen 2.7 percent and the index for natural gas has increased 0.2 percent, while the fuel oil index has risen sharply, increasing 33.4 percent.
All items less food and energy
The index for all items less food and energy increased 0.1 percent in September, a deceleration from recent months. Several factors contributed to the smaller increase in September. The apparel index, which had risen over one percent for four months in a row, declined 1.1 percent in September. The index for used cars and trucks also turned down, falling 0.6 percent after a long series of increases, and the recreation index declined 0.1 percent after rising in August. The shelter index decelerated, increasing 0.1 percent in September following a 0.3 percent increase in July and a 0.2 percent increase in August.
The rent index increased 0.2 percent while the index for owners’ equivalent rent increased 0.1 percent and the lodging away from home index declined 0.7 percent. The index for household furnishings and operations, which rose 0.3 percent in August, was unchanged in September, and the index for new vehicles was unchanged for the third month in a row. In contrast the medical care index continued to increase, rising 0.2 percent for the fifth month in a row. The indexes for airline fares, tobacco, and personal care all increased as well.
After increasing steadily through most of the year, the 12-month change in the index for all items less food and energy remained at 2.0 percent for the second month in a row. The shelter index has increased 1.7 percent over the last 12 months. The index for medical care has risen 2.8 percent while the apparel index has increased 3.5 percent. The new vehicles index has increased 3.6 percent and the index for used cars and trucks has increased 5.1 percent.
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And in other news, massively manipulated & intentionally skewed government data (aka BLS bullshit) came in 'as expected.'
IOW, reality = much worse than whatever is reported, anytime and always, at the Government Ministry of CONfidence.
***Off Topic post script for Reggie Middleton:
Check Out How Apple's Store Revenue Collapsed Last Quarter
Here's The Chart That Should Scare The Heck Out Of Apple Investors...
http://www.businessinsider.com/android-vs-iphone-units-sold-in-first-11-...
If this marks the beginning of a trend, Apple lost its biggest friend (even assuming massive holiday season sugar plum sales boost from broke, stupified and dazed debt serfs - now with retailers desperately bringing back layaway! -maybe).
*Cribbed heavily (directly, actually) from Henry Blodget, but hey, when a man is correct, he's correct.
I'll gladly pay you next Wednesday for some IStuff today!
better yet, iStuff today, the money i was going to pay back, i bought gold instead!
How long will consumers continue to pay over a $1000 a year to maintain smart phone cell service? I'm betting service cancellations is the next shoe to drop. Hmm, food, roof or cell service, which to chose??
Inflation, bitchez!
Can just hear the housing pumpers now, "I think we're laying in the bottom, buy now"...
The level of bullshit has gone from lower left to the very limits of upper right. Where can we possibly go from here, when literally 95% of headlines on Bloomberg are complete fabrications and distortions of the truth?
To 96%.
Well maybe we can invade a few MORE countries this week before WW3 with Iran kicks off in full since all this market nonsense is obviously just a diversion from whats ACTUALLY going on.
To 96.1% actually. Even our bullshit indicators have improved.
Good thing no one has to buy food or fuel...
Eat & heat with your iDooDads, bitchez!
Coming in November, the next Apple killer app: iHeat - warm your utility-shut off and foreclosed home with your iPhone 6 7G s.
Housing permits of 594K? The number is more like -0- no one is building anything, I know Im in home building.
They are including "tent cities" in that number...
Is that the 'tent-up demand' CNBC keeps talking about?
heh heh. nice one sd
Please comment on multi family homes or basically apartment properties. And the area if possible, am interested in East coast US fyi.
Building more prisons.
Tapping captive demand.
In the spring of 2010 I built a 720 sqft garage for my neighbor just for something to do. Guys were showing up at the jobsite about everyday looking for work. It accounted for over 3% of the construction activity in the county.
The story of the year is the move in Brent and how it drives everything.
Gasoline is priced 25-30% higher than this time last year.
The good news is that inflation has only risen 3.6% since 2009. That MUST BE TRUE since the gubmint just announced Social Security COLA increase of 3.6% in 2012.
This is how you buy votes...not how you save Social Security....they should not have ANY COLA increases....and in 10 years it might be closer to solvent....
My friends on Long Is, NY tell me that inside their half-empty development they were buiding all summer long. Nobody's buying. But Pulte needs to look (and feel) busy. So the housing starts are just adding to empty inventory. And since investors are buying in order to rent, the stock of rental housing is not really constrained either
what about that Ritz development off the L.I.E. in Manhasset or thereabouts? Toll Brothers doing the same thing in Jupiter/South Florida. It's effing insane. Next they'll be buying up cheap land in the Dakotas and building Ordos II. Thinking about moving to Greece. At least riots and total dysfunction are honest.
Its Apartments being built to house all the homeless....I wish they would seperate that out...but they don´t ..so people jump on the headline...
No Worries.
Merkel and Sarkozy will have a phone call, someone will agree if terms agreeable, there will be a leak around 3pm EST, and we will end at DOW 20,000 today.
Also, Santa if you are listening, I would like a pony.
I can literally hear the staff of that institution of trust & integrity known as The Guardian pouring over data and vetting credible anonymous sources in preparation for the publication of its latest 'How They Have Fixed the European Union and Resolved the PIIGS+France+UK Debt-pocalypse' story as I write this.
You're just gonna pull that football away just when Charlie Brown goes to kick it again. Don't ask me how I know this...
Same pattern as in early-mid 2010: PPI/CPI spread is widening. That leads to major margin squeeze during a time when stimulus funds are running dry, layoffs are in the air, hopium is running thin and consumers are on the defensive. The new wave of bankruptcies has already begun here in NYC as small biz can't pass on higher costs that keep rising. Look for much more this winter
Mortgage apps down 15% while housing starts up 15%.....hmmmmm.
Of course housing starts were up. People are rebuilding from Hurricane Irene in addition to the fact that normal housing starts from August were pushed into September due to the hurricane.
Need to compare apples to apples. Multifamily housing (apartments) = lower cost housing as folks can no longer afford to stay in there Single Family Residences. Simple as that. Now, if the number showed SFRs going up, that is a different story. Higher numbers for MFR is NOT positive.
all about juicing GDP
While starts were up, permts were down, MBA purchase and refi apps were WAY down.
http://confoundedinterest.wordpress.com
this is how a magician works right, distracts you with one hand while he picks your pocket. factor out apparel and a lot more of that 3.9% passes through in the ex food and energy component.