Category Archives: Offshore Hosting

No. 977: October Labor Numbers and Money Supply, September Trade Deficit, Construction Spending

(SGS Subscription required) • Third-Quarter U.S. Real Merchandise Trade Deficit Was the Worst Ever
• Consumer Outlook Plummets
• Private Surveying of October 2018 Labor-Market Demand Showed Sharp Slowing
• October U.3 Unemployment Rose to 3.74% from Record-Low 3.68% in September; Broader U.6 Unemployment Eased to 7.43% from 7.45%; On Top of U.6, ShadowStats-Alternate Unemployment Notched Lower to 21.2% from 21.3%
• Intense Labor-Market Stresses Remained Consistent with Headline Unemployment Near a Record High, Not a Record Low
• October Payroll Gain of 250,000, versus 118,000 in September Likely Reflected a Relative Boost versus Hurricane-Depressed September Numbers
• Third-Quarter 2018 Real Construction Spending Contracted Quarter to Quarter, Total Construction Spending Fell at an Annualized Pace of 1.7% (-1.7%), Private Residential Construction Spending Contracted by 6.6% (-6.6%), Down by 2.8% (-2.8%) Before Inflation Adjustment
• Weakening Residential Construction and Sales Activity Reflect Impact of Federal Reserve Tightening and Related Consumer Liquidity Squeeze
• Annual M3 Growth Sank to a 14-Month Low in October 2018, with M2 at an 8-Year Low, and M1 at a 10-Year Low (Other Than For Recent Months); With the Level of the Monetary Base at a 21-Month Low

No. 976: Third-Quarter 2018 GDP, September 2018 New Orders for Durable Goods, New-Home Sales

(SGS Subscription required) • Real Third-Quarter 2018 GDP Gained 3.50%, Against 4.16% in Second-Quarter, Yet, Where 70.7% of the Increase in the Level of Quarterly GDP Was in Inventories, Annualized Real Final Sales Growth Plunged to 1.43% from 5.33%
• Third-Quarter Real GDP Stood 18.5% Above Its 2007 Pre-Recession Peak, but Held Shy by 4.9% (-4.9%) of Recovering that Peak, Corrected for Understated GDP Inflation
• Advance Estimate of Third-Quarter Real Merchandise Trade Deficit Indicated Worst-Ever Quarterly Merchandise Trade Shortfall
• Third-Quarter GDP Confirmed Massive Quarterly Trade-Balance Deterioration, Worst-Ever Quarterly Shortfall in Net Exports of Goods and Services
• September New-Home Sales Collapsed to a 21-Month Low on Top of Downside Revisions; Second-Consecutive Quarterly Contraction and Sharply Deepening Six-Month Downtrend Confirmed Plunging Headlines Seen in Other Residential Construction and Sales Series; Activity Constrained by FOMC Policies Pummeling Consumer Liquidity
• Third-Quarter GDP Also Showed Third-Consecutive Quarterly Contraction in Private Residential Investment
• Federal Reserve Tightening Has Hit Consumer- and Systemic-Liquidity Hard, Continuing to Threaten Any Nascent Economic Recovery
• September Real New Orders for Durable Goods Growth of 0.6% Was a Contraction of 0.8% (-0.8%), Ex-Defense, With Gains Increasingly Driven by Government Spending, Not by the Consumer

No. 975: September Retail Sales, Production, Freight, Housing Starts, Hurricanes and FOMC

(SGS Subscription required) • FOMC Discussions of Raising Rates to Restrictive Levels Are After the Fact; Higher Rates Already Are Pummeling Near-Term Economic Prospects and Threatening Financial-System Stability in this Still-Experimental and Unresolved Post-2007/2008-Crisis Environment
• Oil-Price Driven Inflation Does Not Reflect an Overheating ; It Hurts Consumer Liquidity Just as Much as Federal Reserve Rate Hikes
• Faltering Consumer Liquidity Clobbered September 2018 Retail Sales and New Residential Construction
• Real Annual Retail Sales Growth Slowed in a Manner Most Commonly Seen at the Onset of a New Recession
• Building Permits, Housing Starts and Home Sales Just Entered What Could Be Considered a New Recession
• Third-Quarter Permits and Starts Fell in Consecutive Quarterly Contractions; Existing-Home Sales Declined in a Third Consecutive Quarterly Contraction; All Key Residential Series Are in Deepening Six-Month Downtrends
• Minimal Monthly Growth in September Consumer Goods Production Came Entirely from Downside Revisions to August Activity
• With No End in Sight, September 2018 Manufacturing Remained Shy by 4.8% (-4.8%) of Recovering Its December 2007 Pre-Recession Peak
• The 129 Straight Months (43 Straight Quarters) of Economic Non-Expansion in U.S. Manufacturing Is the Longest Such Period in the 100-Year History of the Series
• Mixed Data Distortions/Disruptions from the Hurricanes of 2018 and 2017

No. 974: September Consumer and Producer Price Indices, Liquidity and Markets

(SGS Subscription required) • As Some Acorns Begin to Fall, Beware the Dollar; Risks of Major Financial-Market Upheaval Are High
• Ongoing Federal Reserve Rate Hikes and Related Policies Have Continued to Tighten Systemic and Consumer Liquidity, Pummeling Retail Sales, and Near-Term Economic Prospects, and Threatening Financial-System Stability
• Hurricane-Triggered Boosts to Energy Prices in September 2017 Depressed Relative Year-to-Year Inflation Rates in September 2018; Annual Consumer Inflation Should be Pushing Three-Percent by December
• CPI-U Unadjusted Annual Inflation, Depressed by 2017 Hurricane Distortions, Softened to 2.28% in September 2018 versus 2.70% in August 2018
• CPI-W Unadjusted Annual Inflation, Depressed by 2017 Hurricane Distortions, Softened to 2.33% in September 2018 versus 2.87% in August 2018
• September Real Average Weekly Earnings Growth Remained Impaired
• 2019 Social Security COLA of 2.8% (Based on the CPI-W), Would Have Been 2.4% Using the C-CPI-U, Which Has Been Designed for That Purpose, But Not Yet Implemented
• FOMC-Targeted Core CPI Inflation, Little Affected by Year-Ago Hurricane Disruptions, Held at 2.17% Year-to-Year in September 2018 versus 2.20% in August 2018
• Aggregate PPI Unadjusted Annual Inflation, Depressed by 2017 Hurricane Distortions, Softened to 2.64% in September 2018 versus 2.83% in August 2018