June Durable Goods: Another Miss

Tyler Durden's picture

Those who had read our prediction that the Paris Air Show was a harbinger of weaker durable goods will not be surprised to read that June durable goods just came at a very disappointing -2.1% on expectations of an increase to 0.3%, from 1.9% in May. But it wasn't just Boeing's fault: ex-transportation the number was a subpar +0.1% on consensus of a 0.5% beat, with the May reading revised up to 0.7%. The driver according to Bloomberg's Joseph Brusuelas: "decline in transportation bookings, incl. 28.9% drop in non-defense aircraft orders." And that's not all: "Non-defense ex-aircraft, proxy for capex, points to slower growth in coming qtr." This means that as expected not only is Q2 GDP trending now much lower, possibly below 1%, but the weakness is starting to spill over into Q2 data. As AP reports, "Manufacturing has been the stellar performer in the two-year-old recovery. But activity slowed in the spring, reflecting in part supply disruptions following the March earthquake and tsunami in Japan. Manufacturing was also hurt by the hit the overall economy took from higher energy prices which dampened consumer demand." Ah, still blaming it all on Japan. And to think in Joe LaVorgna's world it was supposed to be a boost to GDP. Kneejerk reaction: USD plunges, futures down, gold surges to new record over $1,626. On so forth.

Some pretty charts courtesy of Diapason's Sean Corrigan:

US durable transport inventory to shipment ratio. Oops:

US durable Gds orders ex-Transport& Defence are barely changed on the year and still stuck at 2000 levels IN NOMINAL DOLLARS...ROC below shows how marked the deceleration has become:


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doomandbloom's picture

due to royal wedding....expected...transitory.

youngman's picture

"two-year-old recovery"....huh????  where the hell is this recovery...oh thats right..it the newly hired workers who work in the Food Stamp application office...

Cash_is_Trash's picture

The Census provided some jobs LOOOOOOL

NumNutt's picture

The sad truth is your comment is not that far from the truth, the only people seeing any form of recovery are the ones that work for the government. The rest of the poor bastards (AKA the tax payers) are fighting over table scraps.

Bohemian Clubber's picture

Off Topic: the ECB wants to take a soccer player as collateral...




slewie the pi-rat's picture

if the player's durable and good, it is not OT

bigdumbnugly's picture

"blaming it all on japan.."

did they forget about george bush?  i thought he was the go to scapegoat

Cash_is_Trash's picture

This is the fault of plate tectonics.

Plate tectonics is now considered a terrorist organization and a foreign enemy combatant.

I'm sure our military where find where Mother Nature lives, execute her and bury her body at sea. Of course, along with the photos.

Sandy15's picture

We are in a Depression and the morons in the WH know it....... 

They fear monger over the debt ceiling so they have an excuse and someone to blame........

101 years and counting's picture

The depression is pissed he was locked away for an extra 2 years due to ben's money printing.  When he comes out of his cage, he's going to destroy everything.

Archimedes's picture

That is ok. Stocks will open down and as volume dries up the algos will levitate the market in the end. Hey, if these algos are so smart why do they have a naturally upswing bias?

Low volume tells them to bid stocks higher? It is counter intuitive. Low volume should tell the machines that there is low participation rate and drift stocks lower. Which means there are a lot of people / Funds holding on to lots of overvalued stock.

Just my morning thoughts...as you were Mr. Market.


HelluvaEngineer's picture

I figure it's the fact that they bait people into overpaying for shares, thereby slowly increasing the trade price.  Which is probably why everyone loves them.  Perhaps I'm totally off base here - would like more input.

SheepDog-One's picture

Not counter intuitive at all if the plan all along was to program the machines to trade the empty markets higher, mainly focused on ETF's which comprise 401K's and pension funds to keep the sheeple placated and calm and not hitting the sell button, until shearing time when theres a 'NATIONAL ECONOMIC STSTE OF EMERGENCY' oh, say something like a default, where the Treasury swoops in and seizes all those $5 trillion in funds overnite. Genius actually. But no point in discussing this as no one will believe you anyway.

bayoutrader's picture

It could have been worse. Doesn't that make it "good news?"

virgilcaine's picture

the b terminal makes some nice charts.  Want one.

johny2's picture

As everyone knows, without a housing market ponzi scheme working again, there can not be recovery. Maybe if Europeans would go to war against each other, but as it is, no chance. So the only question is who gets it...dollar or banks? And we all know answer to that question too.

Hedgetard55's picture

Ben has stocks' back.

SheepDog-One's picture

You sure? Maybe Ben will suddenly sacrifice stocks for bonds. Either way, its all going down soon, except for gold silver and oil.

Hedgetard55's picture

I'm not sure of anything these days other than Ben will print trillions more before this is all over. Stocks may rise in nominal terms but in real we are headed for the rocks. I think.

Peter K's picture

Is Joe LaVorgna like the Barak H. Obama of financial analysis? Just askin;)

slewie the pi-rat's picture

PMs just went highly erectile

new highs for the junker!

here's for the inventory/sales ratio:  ?Pipeline - The Ventures?‏ - YouTube

fuu's picture

Silver pushed to within $0.10 of JPM's closing price yesterday. Oops looks like parity achieved again on the open. JPM gaps down, silver surged a little. See how long this lasts.

slewie the pi-rat's picture

nice ratcheting.  miners a little soft, but catchin a little bid, now.

1621 london morning fix, +8.25 over yest afternoon's.  now, 1627+.  silver chugging along GSR under 40. 

fuu's picture

Lasted about 1 hour 16 minutes.

Zero Govt's picture


it's looking good Gentlemen, really good

Cassandra Syndrome's picture

Why do we need durable goods if we all have iPads and a Central Bank Printing press? I thought Manufacturing was a dodo concept now?....

lizzy36's picture

don't worry another coffee company is coming public today.

should save the day.

mmmmm sugar and deep fried white flour. breakfast of champions and obese yanks everywhere.

critical_mass_soon's picture

Is there any correlation in the stock price of JPM and the stop price of silver?

its just an observation but it seems like the stock price is always a touch above it, abit like it won't dare let silver ounce be more valuable than a share of jpm?

we all know about who close jpm is to the whole silver market i wonder if that has anything to do with the current resistance in silver price especially after gold is blowing its top, abit unusual if you ask me.

any thoughts guys?

WoodMizer's picture

Silver @ $41.42

JPM @ $41.09

as of 9.34 am

Either there will be a silver raid, or JMP will go on another algo fueled rally to cover the silver shorts.  Either outcome is likely before friday.  The comex colludes with the paperbugs out of self interest.

I want to know

A) What is the spread between paper PM's and bullion?

B) At what point will Comex insolvency, become apparent to the greater market? 

Cdad's picture

Yep...yep.  Gee, do you think Autonation is a sell today?  If ever there was a fellow perpetually rah rahing the false recovery, it is CEO Mike Jackson.


SheepDog-One's picture

Maybe Mike  can start another IPO 'Tentnation'?

RobotTrader's picture



Wow, maybe today we'll finally have a down day for AAPL??

That will be a miracle.

SheepDog-One's picture

You should have bought gold instead of bashing it since $1,000, and you'd be SAFELY up far higher than any of your momo pumper paper. Gentleman Jim sends his condolences.

Central Bankster's picture

OR NXG and MFN.  mmm 25-30% gains in weeks, and I own real assets with cash flow.  Unlike that tech garbage you hype.

disabledvet's picture

well we should expect a down day for Boeing at least--now that we know "must balance budget on back of military, must balance budget on back of military." Something tells me "money flow from intellect first."

MRSAP's picture

Another bad economy numbers...

urbanelf's picture

This is bullish because (insert ironic joke about bullishness).

Cortez's picture

This is bullish because the expected Second Half 2011 rebound is expected to be even stronger as orders ratchet up leading into the holiday season.  Time to BUY BUY BUY!!!

adr's picture

This is bullish because everyone will be buying their guns and ammo from Amazon and will need some killing music so they will all buy iPods. This of course will be very bullish for the social media sector as everyone will be posting twits and status updates glorifying the day's kill.You need some comfy shoes for running around all day so you'll buy some Crocs and of course nothing goes better with total anarchy than wings and beer from B-Dubs.

MFL8240's picture

More positive data to suport Bernankes assessment thatb the jobless recovery is picking up steam.  Obama and Biden deserve the award from the banking cartel they represent on their "Summer of Recovery" last year.  Year two is doing great!  This adminstraion is an outright disgrace.

ThirdCoastSurfer's picture

Government has finally learned to lie about how well the economy is doing and to perpetually make it seem like the sky is falling. 

The economy is not stopping Automax from a 20% increase in the selling price of a car or Dupont from raising prices by 17% yet seeing no slack in demand. The same vehicle that sold for $20,000 sold for over $24,000 this time or about $100 more a month in principal payment alone over a 3 year loan. 

The economy is quickly approaching full rubber-band mode regarding inflation. Does the Fed think a 20% rise in the price of a car is transitory? 

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