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Posts Tagged ‘durable goods orders’

What Recovery? Durable-Goods Orders Drop Off Cliff

Posted by Larry Doyle on August 26th, 2013 9:27 AM |

The economy might never look better for those involved in crony, rent-seeking pursuits.

For the rest of us, continued belt tightening is the order of the day.

With wages remaining stagnant, we now get to swallow a heaping of further economic gruel as large-ticket durable goods orders are reported to have taken what might only be compared to a swan dive off a tall cliff.

How long a dive and what is the degree of difficulty connected with this report? “Only” a 7.3 percent decline . . . OUCH. Brace yourself for a large splash and likely bodily injury upon entry.

Let’s review the dive a little closer as the WSJ covers the scene:
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Sense on Cents Economic Review: Red Light, Green Light

Posted by Larry Doyle on May 28th, 2009 11:09 AM |

We had some very interesting economic reports released this morning. The data and its interpretation provide serious “grist for the mill.” On that note, let’s sharpen the stone and get to work.

1. Durable Goods: rose 1.9% versus a consensus expectation of a rise of .5%. Much of the increase was due to strong orders in the automotive and defense industries. Green light, green shoot, call it what you want. This report is much stronger than expected, so get back in there and BUY, BUY, BUY. Actually, hold on . . . 

Do we expect to see growth in the automotive industry going forward? This industry is and will continue to be downsized. Do we think Barack is looking to grow our defense budget? Most assuredly not.

As much as market analysts, media mavens, and government officials are spinning this report in a very positive fashion, let’s dig deeper.

Last month’s Durable Goods Orders were revised lower from an initial reading of -.8% to -2.1%. Red light!! Additionally, given the volatile nature of orders in the transportation sector, economists look at Durable Goods excluding transportation. How did that do?

Wow!! Another green light. Durable Goods excluding transportation orders rose .8% versus an expectation of -.3%. Much stronger than expected. How about revisions to last month’s numbers? Uh-oh!! Last month this report reflected a decline of -.6% and this was revised to a -2.7%!!! Red light!!

So for those who think we’re making progress on this front, put it in the context of “take three steps back and two steps forward!!” (more…)






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