MaxedOutMama
Thursday, August 09, 2012
Initial Claims and Short Notes
Claims headline at 361K, compared to last week's initial of 365K. Not a meaningful difference (last week's revised up to 367K). Four week moving average is 368,250. This, btw, was right where I expected it to be after we got through the auto/school system bulge. I was thinking 367K, so it doesn't make me feel any better about things.
India's having a rough time of it, and it looks like inflation is set to rise for consumers in most countries over the next few months. China is still walking down. It's hard to tell about Japan, really. Indicators are mixed and they still have so much rebuilding to do from the disaster that domestic spending should be up. But machinery orders are rather slack and probably not improving.
The fundamentals add up to a major fall in oil pricing relatively soon. The longer it is deferred the worse it will be. Chinese net demand seems to have been sliding, and that is a factor.
Auctions for the longer US Treasury terms this week have been quite slack. That's something to watch. The high yield on the ten year was 1.68 and the bid/cover ratio was 2.49, extremely slack. 30-year auction coming up! Expect some impact on US mortgage rates and home sales.
I am unnerved to see the US selling so much short paper in comparison to long.
Everything looks short-term now. Yes, there are various easing speculations, but it's clear that all the springs are loaded.
Regarding commercial paper, on a seasonally-adjusted basis nonfinancial domestic outstanding continues to tick down. This is not the greatest indicator. Taken in conjunction with C and I lending at banks, the net looks about flat.
I mention it because the US inland waterways shipping stat didn't look too good for June:
The weakness showed up in the Federal figures for June. This was one of the deciding factors when I figured June 2009 was the end of the recession.
Usually my inflection points for going into a recession are months ahead of the "official" ones. I have the inflection point this time at February 2012, but I think the official start date will be June (May peak). We won't hear about it until after the election, and probably not until next year, but the employment, freight and retail indicators are all showing a definite shift to the negative. Weakness has showed up in various PMIs and manufacturing surveys. The negative CMI indicators show rising financial stress impacting many businesses.
I also watch port stats for Singapore, and so far this year they have shown definite patterns of weakening. Not coincidentally, Singapore revised its GDP growth estimates to marginally positive for the year.
I mention it because the US inland waterways shipping stat didn't look too good for June:
The weakness showed up in the Federal figures for June. This was one of the deciding factors when I figured June 2009 was the end of the recession.
Usually my inflection points for going into a recession are months ahead of the "official" ones. I have the inflection point this time at February 2012, but I think the official start date will be June (May peak). We won't hear about it until after the election, and probably not until next year, but the employment, freight and retail indicators are all showing a definite shift to the negative. Weakness has showed up in various PMIs and manufacturing surveys. The negative CMI indicators show rising financial stress impacting many businesses.
I also watch port stats for Singapore, and so far this year they have shown definite patterns of weakening. Not coincidentally, Singapore revised its GDP growth estimates to marginally positive for the year.
