July Seasonally Adjusted Retail Sales “Mixed Bag”; Manufacturing Output Rises Led by Auto Sector
by ilene - August 17th, 2010 5:26 pm
July Seasonally Adjusted Retail Sales "Mixed Bag"; Manufacturing Output Rises Led by Auto Sector
Courtesy of Mish
Excluding autos and gas retail sales ran out of steam in July 2010. Please consider the SpendingPulse Report July Retail Sales Show Mixed Results.
After several months of sales slowdown, total retail sales have stabilized somewhat, although overall growth has slowed sharply since earlier this year. In fact, growth in July headline numbers was driven largely by an increase in spending on gasoline, which is why the ex-auto ex-gasoline number is a better barometer to measuring the underlying health in retail spending.
July’s growth rate excluding auto and gasoline leaves the three-month average year-to-year growth rate of retail sales at 1.0%, well below the 3.5% for the prior three months. The ex-auto year-over-year numbers tell a similar story of a shallow and stabilizing trough, with the unadjusted three-month average year-over-year growth rate slowing to 1.6% compared to the 6.5% average growth rate for the previous three months.
The first table above compares June and July 2010 vs. the same month in 2009.
The second table shows July 201o vs. June 2010 seasonally adjusted. For an alleged recovery, these are weak numbers.
Industrial Production up 1 Percent, Led by Autos
Inquiring minds are taking a look at the July Federal Reserve Industrial Production and Capacity Utilization report.
Industrial production rose 1.0 percent in July after having edged down 0.1 percent in June, and manufacturing output moved up 1.1 percent in July after having fallen 0.5 percent in June. A large contributor to the jump in manufacturing output in July was an increase of nearly 10 percent in the production of motor vehicles and parts; even so, manufacturing production excluding motor vehicles and parts advanced 0.6 percent.
The production of consumer goods moved up 1.1 percent, as the output of consumer durables jumped 4.9 percent: Production for all of its major components advanced. In addition to a gain of 8.8 percent in the output of automotive products, which was mainly due to a large increase in light truck assemblies, the indexes for home electronics and for miscellaneous goods increased 1.3 and 1.5 percent, respectively; the index for appliances, furniture, and carpeting moved up 0.5 percent.
Among components of consumer nondurables, the output of non-energy nondurables declined 0.2 percent, and the output of consumer energy products moved up
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Credit shrinkage will continue throughout the recession and into the recovery
by ilene - August 1st, 2009 9:32 am
Credit shrinkage will continue throughout the recession and into the recovery
Courtesy of Reggie Middleton of Reggie Middleton’s BoomBustBlog.com
The credit bust will be long lasting, and will harshly effect companies without strong business models – which is a lot more companies than many think due to the fact that a credit bubble has kept so many on life support. See Marginal companies with marginal business models are going to crack for my take on this.
Last month’s BIS Annual Report states "Aggregate statistics show a sharp slowdown in the growth of credit to the private sector starting late in the first stage of the crisis." The delay in credit restriction was misleading to many and masks the full effect or credit restriction. The time lag stemmed from 1) forced balance sheet expansion due to off-balance sheet vehicle re-intermediation; 2) draw down of existing credit lines at favorable conditions by borrowers (these favorable conditions, and as a matter of fact the actual credit lines, are no longer availabe). The mounting and prospective losses that I have detailed in The Re-Release of the Open Source Mortgage Default Model and Green Shoots are Being Fertilized by Brown Turds in the Mortgage Markets outline (just in residential real estate lending, notwithstanding all other classes of lending) just how much more restrictive credit can get.
This portends less growth and expansion in the future (as in through the end of the recession potentially well into the tepid recovery), not more. As all regular followers of this blog have come to realize, US equity prices have totally and completely detached from economic fundamentals, thus this reality has not been factored into prices. When it does (this is a matter of when, not if), signficant price compressions (read as "crash") may ensue. In the meantime, starting in the middle of next week, I will be offering subscribers illustrative examples of methods that I am employing to reduce directional risk, a risk which fundamental investors such as myself gladly consume in normal times.
Lending continues to slow as bankers and borrowers refrain from taking risks, in a bearish sign for the economy.
The total amount of loans held by 15 large U.S. banks shrank by 2.8% in the second quarter, and more than half of the loan volume in April and May came from refinancing…
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.