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Philly Fed Beats, 3 Standard Deviations Above Consensus
The US economic outliers continue. Following a barrage of far better than expected economic data earlier, we now get the Philly Fed which printed at 10.3, a spike from the previous reading of 3.6, and 3 standard deviations above the median estimate of 5.0, beating all economist forecasts but one (that of Sean Incremona of 4CAST). From the report: "The diffusion index of current activity, the survey’s broadest measure of manufacturing conditions, remained positive for the third consecutive month and increased from 3.6 in November to 10.3 (see Chart). The percentage of firms reporting increases in activity (25 percent) exceeded the percentage reporting decreases (15 percent). The index for current new orders showed a similar improvement, increasing 8 points. The shipments index, at 6.7, was mostly flat. Twice as many firms reported declines in inventories (30 percent) as reported increases (15 percent) and the current inventory index fell 22 points to ?14.9." And the less than outlier news: "Labor market conditions continue to show overall improvement, but indexes edged down this month. The current employment index remained positive at 10.7, only 1 point lower than in November. The average workweek index also remained positive but fell nearly 9 points." Have fun reconciling that with earlier sterling claims data.
Continuing the trend of ignoring reality and hoping for the best we see the same pattern once again in Six Month future Indicators:
Indicators for future activity continued to improve this month. The broadest indicator of future activity increased 2 points; it has now increased for four consecutive months and is at its highest reading in nine months (see Chart). The index for future new orders also improved, increasing 8 points. Although employment forecasts remain generally positive, the future employment index fell 13 points. The percentage of firms expecting to increase employment over the next six months (24 percent) is significantly higher than the percentage expecting to decrease employment (11 percent).
Furthermore, it appears inflation is nowhere near close to dead:
Increasing costs were more widespread this month compared to last month. The percentage of firms reporting higher input costs increased from 31 percent in November to 41 percent this month. The prices paid diffusion index increased 11 points. The percentage of firms reporting increases in prices for their manufactured goods (22 percent) was higher than that reporting decreases (10 percent). The prices received diffusion index increased 9 points, to its highest reading in seven months.
Like in the Empire Fed Index, price paid delta was higher than prices received: not good for margins.
Lastly, here is how the Wall Street crew fared when predicting the number: in summary another 3 std dev outlier.
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Man that hopiumn is one strong drug! Where are they getting this data? China? The elves?
With this con data poor Bernanke is in a bind. With unemployment going down and inflation slowing creeping higher, he cant even justify a QE. Poor Wall St won't be getting any hopium fix anytime soon.
Chicks and fishing poles.. http://hedge.ly/gFWVSm
Benny doesn't need to worry about American data. He can print for Europe. He can print for Japan. In his eyes he is central banker to the world.
http://azizonomics.com/2011/12/01/central-banker-to-the-world/
It seems like one last ditch effort to present to the sheeple that the recovery is fine and well before the election.
SE, I believe we are seeing a "hidden" pre-war manufacturing bump.
Would make sense, ne? I'm sure the MIC accounts for a lot of the Filly NUMBers.
ORI
/the-plan/
Not a lot of MIC here in Philly anymore, still a lot of pharmos but most of the gasoline refineries have closed down in the last year.
Interesting RC. But in this weird way, everything seems to be in support, at some not too far layer of abstraction, to serve the MIC. Dreamin' DARPA dreemz!
ORI
For sure, but evidently not in the Philly area. Boeing looks to be chugging along:
http://www.boeing.com/aboutus/govt_ops/state_cards/card_PA.pdf
But not Lockheed:
http://www.huffingtonpost.com/2011/06/14/lockheed-martin-to-cut-jobs_n_876947.html
Wall St seems less than impressed...maybe they will stage a mutiny against the FED 'good news' plan....-1,500 DOW day would do the trick.
The market has kind of shrugged this news off. Running out of hopium?
I don't get it. Current movements are puzzling to say the least.
WTF over? Year end rebalancing already is all I can muster.
Somethings Fucky
I have a feeling the bulls are in for a nasty surprise. Really nasty. I've been wrong before, and I'm sure I'll be wrong again, but this feels kind of flash crashy to me.
I have been a believer in the decoupling thesis, but the markets feel wrong. Why is this all we can muster today?
I am afraid I agree, things starting to feel crashy. Fear lurking beneath the surface is palpable. We should be up 20+ pts not 5. Folks are skeered.
Fear<-------------------<*--------------------------------------------->hope
On the fear-hope spectrum, the markets are the asterisk.
Heeeeeere kitty come kitty kitty come kitty...
Those guys crack me up
Theres no free Hefty bags full of crack in this news....stocks are pissed!
It's still tracking the EUR/USD.
Can anyone tell my why the VIX is at 24??
Are they shorting the VIX to create an illusion of less volatility?
Purely liquidation. No options.
Bingo. The next leg down is going to surprise a lot of people who misinterpret VIX signals.
As an OEM I can tell you where the numbers come from...fear that the prices will be higher come Jan 1. Same old story every year, the prices jack up on the first. To make matters worse, the commodities speculators have jacked up the raw materials so bad ( the last 6 months) that by the time the "value added' costs ( including driving stuff from there to there) are added, it is not a simple as 10%, it often times is 100% mark up by each vendor. Everyone is trying to stay ahead of the 'curve' except the curve is a bad road to hell next year. We just bought an entire year of raw manufacturing supplies so we don't have to feel the speculators whip...after the supplies are gone it is retirement time and screw business....it ain't worth it no more. You can no longer plan ahead or hope that the cost to do business will not hit you in the head by surprise.
I do hope all you copper and industrial metal speculators go down hard, so hard you live under the bridge you put so many Americans under.
On a note to show you the example...Triskets, the cracker, 12 months ago was 15 oz, late spring 13 oz, late summer 11 oz...now 9 oz, but the price is the same. Now you know what every item in the store is doing while you are chatting on you phone instead of looking at the box and its' price.
When fiddled 'good' news is bad.... no QE soon... ooops
'Furthermore, it appears inflation is nowehere near close to dead:'
Need more cowbell.
It's alive! It's alive!! Bernankenstein's Monster is alive!
It really is amazing how far beyond acceptable the various government, quasi government and conflicted private agencies and entities are going in their 'reporting' of economic statistics in order to convince the (we) plebs that all is well, just keep shopping till you drop.
The interesting thing is that the more "out there" the "economic reporting" becomes, the more likely it will be believed by the average Jane and Joe. There comes a point when the lie diverges so far from reality that those who are asleep or just very frightened will choose to believe the lie rather than deal with the truth.
My friend, why are you continually 'amazed'? I highly suggest a short little work by Freud and Rank on group psychology. Here you are:
http://www.amazon.com/Group-Psychology-Analysis-Norton-Library/dp/039300...
Le Bon is also exceptional in this field. I'd also suggest some Marxist sociologists but I feel I'd overstep my boundary as "Marxism" is still mostly taboo in the good old US where I presume you reside.
Yea well Avg Jane and Joe will only believe so much while theyre not only visiting grandmothers house for Christmas, but also moving in. Good times.
DXY at 80 will do wonders for US exports
It's not so much about getting an increase in actual exports but devaluing the $ giving the illusion that exports are up. The € is an obstacle and it seems Bernanke now knows.
3 standard deviations = Unicorn farts and rainbows.
Should not be considered as mathimaticaly reliable data.
Our friend Dr Sanders (snakeeyes) about to give testimony to congress. http://www.c-span.org/Events/Lawmakers-Study-Effects-of-Euro-Crisis-on-US-Economy/10737426292-2/
Going long propaganda. Buyin it right here and intending to sell it late 12.
Seriously, where is the 3x leveraged propaganda ETF?
Cant eat propaganda though. 'Good news' to these stock markets is like handing a crackhead a protein smoothie and egg white omelete...they really dont give a shit they just want crack.
Only positive market driver is bad news...good news means QE3 chatter is dead, and stocks only love sugar daddy QE3.
QE3 is a done deal at the january fed meeting... a couple euro banks will have sunk by then, and three new doves as reported here.....
Why are none of the legacy media outlets questioning these multiple standard deviation upside beats? Somewhere along this road even journalism, our last hope has been corrupted. Apparently Jack Nicholson was right we can't handle the truth.
In the legacy media outlets, there is no journalism.
The Feds were bound to beat: after all, they have got to offer the market "something", if they cannot offer QE.
Well there goes QE3 out the window.
SD-1, do not say that too loud. The crybabies might hear you.
Come on guys. ZIRP is QE and monetization.
Apparently not Sheep. I am wondering if they have to pump the data to avoid demands for QE3 now. The market has QEVIII priced in though.
Not necessarily. They could argue that the US came out of recession with the means of previous QE and stimulus. Now the focus could be on stimulus again to avoid a repeat of the recession, and jeopardize this sweet little gentle precious "recovery" (propaganda) of theirs.
From the BLS to the various Fed Apparatchik Bureaus, more meaningless stats in Barry Soetero's Amerikan paradigm.
http://vegasxau.blogspot.com
More on the failures in the recent eurozone agreement:
http://online.wsj.com/article/SB1000142405297020389340457709825269759368...
Yeah....but Hopium just doesn't cut it on this sad, sad day for America: the day we declared mission acomplished in Iraq, lowered the flag and left.
Nope, Jr. flew in on a jet and declared that some 8 years ago, we're just now getting around to leaving.
True. But we need dubious, frivolous wars in this country
what is the shelf life of the last round of hopium...a day or two?
NAR's Lawrence Yun has been named head of Obama's "Re-election Campaign Plunge Protection Control Team" and now oversees all economic data in the US!
I see GREEN.
OT: Anyone else not taking into consideration how the Shegnhai Comp is tanking?? From what I ahve seen they always lead the way by a few months.
Also, I have noticed that the DJIA and the TSX have gone their own ways (It has been for a long time now where the TSX had anywhere from 500-2000pts up on DOW, now TSX trails the DOW by a 300pts). PPT doing a good job. Sorry, just thinking out loud here.
Without QE3, U.S. debt buying may start to dry up....oh wait, banks still get money for free....never mind...
hey jamie dimon! kill anyone lately?
Today is definitely a "sell the news day"
Sure seems so. I keep hearing people say it all basically runs on 'suspension of disbelief' from here on out....well, you cant eat it.
Got nothing to sell anymore. Today is a day to pack up and leave and convert the cash to tangibles.
Wow great link, the numbers simply DONT add up as you point out.......
Hey let em pump all the 'good news' BS they want, 2008 turned markets into free crack junkies, and they want free crack not 'good news'. They just cant have it both ways.
second that REAL economic growth is death to the markets, they prefer living off QE money buying back shares and engineering corporate profits. and once things really pick up the money will have to go to work, and quit chasing paper.
Since 3 years ago, markets were transformed into degenerate crack addict junkies...now suddenly theyre supposed to change back into triathlon competing health nuts?
Doesnt work that way.
If you just take a look at the breakdown by states, you will understand that the headline number is total BS. Only 2 states where the claims decreased by more than 1k. On the other hand, only in CA claims rose by 22k+.
fudge the numbers so the people will be unsuspecting and sleeping in their beds soundly when they come to take you away to FEMA camps. QE3 is just a distraction while they fire up the internal security controls now-they know it won't work.
Stocks already angry at the new FED 'good news' plan...stocks hate it, and chanting 'We want free crack!'
They dont understand this good news thing....theyre used to hearing numbers miss, and get promised rumors of further easing and bailouts. The machines dont know what the hell to do with good news.
If I were ECRI, I'd be gnashing my teeth.
You make a flat-out, unhedged U.S. recession call.
Then the economic data rips your face off. Aggravating!!
Time, the avenger.
And theyre all out of time.
Someone brought a refirgerator in Philly.. we are saved.
Not all the news today was good. Or yesterday.
Industrial Production And Mortgage Purchase Apps Cool
http://confoundedinterest.wordpress.com