The Fed accidentally released its Industrial Production report a half hour early today.
IP was 0.2% with an Econoday consensus o 0.3. Manufacturing was a disaster, down 0.1% vs an Econoday consensus of +0.2%.
The Federal Reserve inadvertently released what is a weak July industrial production report about a 1/2 hour early this morning. Headline production rose 0.2 percent vs expectations for 0.3 percent with manufacturing output showing outright contraction, at minus 0.1 percent vs Econoday’s consensus for a 0.2 percent gain. Capacity utilization hit expectations at 76.7 percent.
A 3rd straight decline in motor vehicles, down 3.6 percent in July, held down the month’s production. Excluding vehicles, manufacturing rose 0.2 percent. But also not helping were business equipment, down 0.5 percent in the month, and construction supplies, down 0.4 percent. On the plus side with small gains are consumer goods, materials, and non-industrial supplies.
Outside of manufacturing, mining posted a 4th straight solid gain, at 0.4 percent, with utilities swinging higher with a 1.6 percent July increase.
This report, which is the first definitive look at July’s factory sector, is unexpectedly flat and puts an end to the run of recently strong economic data. Strength in sentiment surveys like this morning’s Philly Fed do not always match the real world. Vehicle sales were up in July but it has been a tough year for the sector. And given the decline in this report’s manufacturing component, the upward momentum that the factory sector was showing looks less certain now.
Industrial Production vs Capacity
Econoday says this report breaks the string of recently strong data. I strongly disagree. Yesterday’s anemic housing report did. For details, please see Housing Starts Unexpectedly Sink, Multi-Family in Huge 34% Retreat Year-Over-Year.
Finally, recently strong retail spending reports are questionable. The BLS says motor vehicle sales rose 1.2% in July following a 0.9% gain in June. This is unbelievably bizarre in the face of actual auto sales reports.
Mike “Mish” Shedlock
The economics PhDs at Moody’s Econoday obviously need to slaughter different animals / get a different batch of entrails to study. These entrails are not working.
Some will suggest a different batch of witch doctors to interpret the faulty entrails, but those people are forgetting that doubting the opinions of keynesian economics PhDs is exactly like questioning Papal infallacy. It just isn’t tolerated.
Even suggesting that Keynes put his pants on one leg at a time is heresy, and when caught you will be publicly ridiculed for things you didn’t actually say, then fired from your job for not being extremist left wing enough, and after the media uproar dies down you will be burned at the stake as the heretic you clearly are (or that the media wants to portray you as… same thing).
Be a good extremist liberal and believe what you are told to believe.
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The Keynes memorial statue is being relocated to the front of the Eccles building as we converse…
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Pelosi has already called for George Washington’s statues to be eliminated from DC — he was a slave owner so no good.
Martin Luther King Jr was originally engaged to a white woman — of German descent as if the white thing wasn’t bad enough. His pastor father told him to call the engagement off and marry a suitable black woman. Obviously we can’t have children hero worshipping such a racist.
The children will be hard at work digging up half the people buried at Arlington Cemetary, so we have time to cleanse the country of evil MLK statues.
On good authority, Mother Theresa once stubbed her toe and yelled “SH!T” under her breath. We’re gonna have to get rid of anything memorializing such a potty mouth.
Jesus once knocked over tables and tried to shut down a bazaar that was selling political statues, but west coast liberals have already been hard at work eliminating crucifixes and other statues of that evil man.
Where the committee for social justice and correctness needs your help is with the Lincoln Memorial. The guy emancipated slaves, and we already told the masses that was a good thing — but it turns out Lincoln was a member of the Republican party.
I think we are going to have to have the academics re-write some more history books to say Lincoln was an agent of Vladimir Putin….
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Abraham Lincoln – The Whitewashed White Supremacist…
I would love to see the Lincoln memorials torn down. Sic Semper Tyrannis…
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In 8000 years of recorded human history, we have yet to have a single human who is without fault.
They used to teach things like that in colleges, back when there were adults on the faculty. Safe space is for nursery school and maybe kindergarten
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“In 8000 years of recorded human history, we have yet to have a single human who is without fault.”
Absolutely correct. In addition, there seems to be a bizarre preoccupation with judging historical figures by today’s standards. Somewhat analgous to saying Einstein was a simpleton because he never used a “smart” phone. But thinking is difficult. Jumping up and down like oversized toddlers is easy.
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No, Pelosi called for removing confederate statues. George Washington was not a confederate. Fake news.
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Maybe she changed her comment after so many people pointed out how ridiculous it was. Her initial comment (straight from her mouth) was to remove statues of slave owners… because Soros’ original “spontaneous protest” was allegedly about white supremacists, not the confederacy.
Her second comment will bite her also. The confederacy was about state’s rights versus federalism — which is why southerners call the civil war the “war of northern aggression”.
That witch doesn’t know what she is talking about. She is scared of Trump draining the swamp because she is a swamp — the swamp creatures are all scared because even flopping around Trump is exposing how the swamp works.
Let’s go back to talking about how Pelosi bribed members of Congress (which is a felony) and then we can discuss her tyrannical rants. We’ll talk about whether she and her husband actually own the real estate holdings that fund her life, or if she stole them from Mexico later. Probably not a topic she is anxious to debate.
Until then, could you kindly grow up and accept that Trump is the President? Like other people had to accept Obama, despite really not liking him? Could you at least act like an adult? Like it or not, the public really voted against the rampant corruption that **IS** Washington DC, including (especially) that witch Pelosi. Pelosi cost her party the election, even if you threaten to hold your breath until your diapers soil.
Grow up
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There needs to be one so some bright future day it can be pulled down.
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We all knew Trump was going to try to drain the swamp, and we all knew the swamp wasn’t going to go quietly.
Few of us realized the level of infancy that is Congress and their support staff. We knew they are mostly corrupt, but turns out many of them are genuinely childish Peter Pans, unwilling to grow up
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The key premise of Keynesian theory is that the govt spends/borrows money productively during economic downturns and pays back the borrowed money when they run a surplus. Obviously they seem incapable of spending productiively and never pay back the money. For some unknown reason this little fact is never mentioned,
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The fact that the debt is NEVER paid down and productivity fails to return should be proof enough that Keynesian theory is crap, but then again economic theories are never proven wrong, only underfunded. if they could have only borrowed and spent MOAR.
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Unexpected recession/depression in the making?Hope not.Mish soapbox provides us with ego satisfaction but it really is nothing to laugh about
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This report, which is the first definitive look at July’s factory sector, is unexpectedly flat and puts an end to the run of recently (UNEXPECTEDLY) strong economic data.
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“The BLS says motor vehicle sales rose 1.2% in July following a 0.9% gain in June.”
…
Census Bureau issues retail sales report.
Anyways, those sales figures include addition to dealer inventory (steadily building) … and not to mention increasing incentives to close “real” sales.
“significantly higher incentives”
“GM’s July incentive spending as a percentage of average transaction prices (ATP)
was 11.5 percent, more than 1 full percentage point below the industry average,
and 0.5 percentage points below GM’s 2016 calendar year average. Some of
GM’s competitors, without strong truck and crossover businesses, are offering
significantly higher incentives across their entire portfolios, according to J.D.
Power PIN estimates.”
http://media.gm.com/content/dam/Media/gmcom/investor/2017/aug/GM-July-2017-Sales.pdf
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The minor crash on the markets today is very important given the median fall in prices. Two causes. Profit forecasts are waning and Trump is wobbling. A correction for the markets will have a profound effect on sales and production. Once the top 5% have to deal with falling share prices, that is they are “poorer”, what strength their was in the economy will disappear. (Remember the top 5% spend as much as the bottom 80%.) The world economy has topped out with China in stasis before their Congress in a few months.
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BTFD
Need I say more regarding financial theory?
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“Lying economists” is turning into an oxymoron….
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One more economic report, signifying very little. Barring some black swan event, expect continued slow growth in the US, of 1-2%. I’m not sure why some seem to be cheering for a recession/depression. If I lived in the US I would be hoping for much better.
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Easy answer. Misery loves company.
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Reasons for a recession / depression: over production,car ind.is a good example. Political turmoil is over import/ exports(Trump vs,China.and others,present day debt& credit are unsustainable ,the list is endless. For those who forecast growth I ask on what basis? Remembering that this is a material world not an Ideal one. There is an old saying ( shit in one hand and wish in the other) 2% growth? Are you from Venus?
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We should ALL be hoping for much better. Those hoping for collapse are frustrated that meaningful positive change is never coming. Of course meaningful change would necessarily cause financial collapse as it is only the corruption and belief it is infinitely sustainable (which it is not), that does sustain us. Delusion is our only salvation (albeit temporary), so is it any coincidence that drug addiction is at an all time high?
At this point the only real sustainable future lies in complete self sustainability, something very few are prepared for, and even that has no guarantee.
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Stocks I follow were down today on half normal volume. The conductor and the musicians are reading different pages of music.
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The report was released to the general public instead of their insider friends first. That kind of mistake will cost GS dearly.
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