Thursday, June 17, 2010
Employment decreased slightly. Shipments declined slightly, and inventories tended to move a bit higher. Not surprising that work hours dropped slightly. Six month expectations were still good, though. Capital expenditures were barely positive at 3.0.
In recent years I have noticed that Philly Fed seems somewhat linked to home construction, so I expect this one to be worse than the others for a while. Housing starts are in the basement, and I can't see them going anywhere else very quickly:
The bend in the long T-bill yields vs shorts appears to be getting unkinked today.
My feeling is that Consumer Metrics (which picks up electronic data) is slightly biased toward the more discretionary purchases.
I have more spending on basics, more cash spending, but a slowly weakening picture.
On the other hand, deposits show that future months won't be as bad. Unless, of course, people get really freaked out by higher oil costs.
Politically, the agitation over taxes and government spending are baseline - they have nothing to do with party/ideological affiliation for the most part, but rather are due to the fact that many households are having trouble making ends meet.
js (ANON at 2:03)
That is why we are getting so many mixed signals. There is growth but it is not strong, only coming from half the population, and not in any areas that traditionally have had large multipliers.
If there is a wave of govt lay-offs that could tip us back into recession. If there is a global panic of any sort which causes people to hunker down that could tip us back into recession. If we are able to keep the extend and pretend game going for the banks and govt debt issuance we'll probably keep muddling along as we have been.
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