In order to "suggest" that the US economy had grown by a far greater than expected run-rate, the BEA was forced to revise away personal income, and "assume" these had instead been invested in the US economy, in the form of a surge of durable goods purchases. Sure enough, while both incomes and savings tumbled, spending magically surged: So if that "statistical" amount of money you thought you had saved in the BEA's savings.xls spreadsheet just dropped by 10%, fear not dear Americans: it was all used for a good cause: to fabricate a much stronger than expected Q3 GDP number.
Israel's leader Benjamin Netanyahu said this morning "we will rectify this absurdity." We suspect he was talking about this chart!!
Fed’s wealth effect kicks in: “Mind-blowing” how the luxury market has been “completely on fire.” The rest, well….
Gold spiked higher in many price feeds overnight and was $270 higher or more than 22% higher to $1,467.50/oz at one stage in what appears to have been some form of computer glitch. It was not manipulation, a short squeeze, or a modern Chinese or Russian ‘Goldfinger’ sending a pointed message to Washington.
Moments ago the Census Bureau reported that 458K new homes were sold in October (with a 16.5 error confidence), which missed expectations of a 471K increase from last month's 467K print, but that's ok, because last month's number was also revised substantially lower from 467K to 453K, which in turn will allow the mainstream propaganda to tout that New Home Sales jump in October to match the highest print since October 2013. There is one problem: here is what the update chart of New Home Sales data looks like on a historical basis... and as revised. It sure puts that 458K "increase" in a slightly different light.
Following the Conference Board's tumble in confidence, Bloomberg's consumer comfort index surged this morning (rather aberrationally) to highs not seen since 2007. However, while UMich consumer confidence rose from last month to its highest since July 2007, it missed expectations by the most since October 2013. It would seem the survey respondents in UMich and Bloomberg confidence are stockholders, and Conference Board respondents are not... UMich data is dominated by a surge in current conditions with the outlook flat.
Having surged to last October's highs last month, Chicago PMI tumbled back to mediocrity in November, missing extrapolatedly exuberant expecatations by the most since July. As 60.8 (against 63.0 expectations) this is barely above the levels of Q1's polar vortex as New Orders, Employment, and Production all fell (with only 2 components rising). This is the 4th largest MoM drop since Lehman but MNI remains confident that "the trend remains positive..."
Is the oil cartel impotent? Is the price of oil going to fall further? What to expect from tomorrow's OPEC meeting.
All the blather about "growth" and GDP is just propaganda to misdirect our attention from the real problem: the total domination of governance and finance by a class of vested interests and mega-wealthy cartels/oligarchies.
If yesterday the BEA provided the sugar high for Q3, with a GDP number that will be soon revised lower, then today's economic barage has so far been a disaster, with both Initial Claims, Personal Income and Spending, and now core Durable goods and capital goods shipments and orders missing across the board.
Having trended gradually higher for the last 5 weeks (missing expectations for 4 of them), initial jobless claims printed an uncomfortable 313k (against expectations of a 288k print - the biggest miss in over 11 months) pushing to its worst level in 3 months. This is the biggest week-over-week rise in almost 4 months. Continuing claims hovers at 14-year lows and dropped this week to 2.316 million. Perhaps worryingly, this rise in initial claims is considerably larger than the average shift for this time of year...
Who could have seen this coming? With oil prices holding at 4-year lows, heavily pressuring around half of US shale production economics, the "secret" US deal (see here and here) with Saudi Arabia to crush Russia via oil over-supply in a slumping demand world appears to be backfiring rapidly for John Kerry and his strategery team. Capable of withstanding considerably lower prices for longer, Saudi Arabia's oil minister Ali al-Naimi proclaimed "no one should cut production and the market will stabilize itself," adding rather ominously (for the US economy and HY default rates), "Why should Saudi Arabia cut? The U.S. is a big producer too now. Should they cut?" With prices expected to drop to $60 on no cut, maybe the "unequivocally good" news for the US economy from lower oil prices should be rethunk.
While the second day of protests in Ferguson were far more contained as a result of the tripled presence of national guard troops in the St. Louis suburb, with media instead focusing on events in New York, LA and other major metropolitan centers, St. Louis violence failed to avoid the headlines for another day when shortly before 3 am, two FBI agents were shot early Wednesday morning in north St. Louis County. The good news according to Reuters, is that this latest assault was "not directly related" to racially charged unrest in and around nearby Ferguson, an agency spokeswoman said. "The incident is not directly related to the Ferguson protests," Wu said, but did not elaborate further.
- National Guard, police curb Ferguson unrest as protests swell across U.S. (Reuters)
- Ferguson Reaction Across U.S. Shows Complex Racial Split (BBG)
- Democratic senator Schumer: Democrats Screwed Up By Passing Obamacare In 2010 (TPM)
- Veto threat derails Reid tax deal (Hill)
- Justice Department Investigating Possible HSBC Leak to Hedge Fund (WSJ)
- Merkel hits diplomatic dead-end with Putin (Reuters), and yet...
- Merkel Said to Reject Ukraine NATO Bid as Rousing Tension (BBG)
- HSBC, Goldman Rigged Metals’ Prices for Years, Suit Says (BBG)
It has something to do with a Catch-22...