The Dallas Fed Manufacturing Region Activity was negative for the 19th consecutive month but approached zero.
Things improving? Let’s take a look at some details to sort out the situation.
Conditions Stabilizing?
Production actually went into the green, but barely. General business activity soared 17 points but still finished negative.
That’s it for the good news. And I suspect much of that good news is related to excessive heat and an increase in utility production.
New orders continue to crash. The growth rate in orders was lower for the 21st month.
Prices paid by manufacturers rose for the 4th month but prices received by manufacturers fell for the 19th month.
Wages and benefits rose for a whopping 80 months.
The report title was “Texas Manufacturing Activity Stabilizes“. Details suggest otherwise.
Mike “Mish” Shedlock
“The report title was “Texas Manufacturing Activity Stabilizes“. Details suggest otherwise.”
Yeah, well … put me down for “so goes oil, so goes Texas”
And it is heading back down. WTI had a $50ish handle in June … now $43.
http://www.marketwatch.com/investing/future/crude%20oil%20-%20electronic
My business is in Dallas serving mostly corporate expansion and relocations. Things have been and still are busy, but I have noticed quotes have slowed to a crawl. Our work is typically two months out so we have some lag, but not much. Its been pretty hot and cold for the last eight years, and with each new slowdown I wonder if it is “the big one”. We have seen some really big relocations to Dallas, the likes of State Farm and Toyota, but they are very frugal with spending. Even the new Dallas Cowboys training facility and world headquarters is impressive…but on a budget (and Jerry Jones doesn’t seem to spend a dime unless a state or local government entity kicks in a nickle of it).
In short, Dallas has avoided some of the worst pain of the last eight years but oil prices most definitely will effect things as time goes along. Even Exxon is now shopping out purchases from China rather than buying domestic or local, and if Exxon can’t afford it, who can?