Thursday, January 17, 2013
Industrial Production Was Strong, But
Unfortunately, the first two January manufacturing surveys both came in solidly in the negatives. Philly Fed (-5.8). Empire State (-7.8). Philly Fed asked questions about constraints on employment:
This isn't wildly favorable. Empire State showed a big pickup in input prices, which makes one wonder.
The Fed seems to be backing and filling on its bond buying plans, but I guess these two will assuage the angst for this month about the effects.
I don't believe much of the Fed's newly created money gets into the broad economy, but if stocks and real estate rise, the wealth effect will prevail.
At least for a while.
And then there are all the collateral jobs created.
Cheap electricity is making it more favorable to insource currently. Fracking has been more of a boon to the US economy than all the Fed purchases.
The question is whether they will pay a bounty for flies or pythons, and whether we will be expected to build blast furnaces in playgrounds or manufacture our own cups out of wood we chop down in Central Park.
It would also be good to maybe get them to wear little symbols, so innocent retirees could tell who they were dealing with.
Once we get rid of the rule of law we will make such huge advances into utopia!
That is one of the scariest articles I have ever read.