May personal spending returns to typical late cycle pattern The consumer continues to do okay. That is the message from personal income and spending as reported for May this morning. First of all, let’s compare the YoY% growth in real personal spending (blue) with real retail sales (red): For the last 50 years, during all […]
The yield curve is already signaling a slowdown Throughout this expansion, I have had a sneaking suspicion that the yield curve (the difference in interest rates between short and long term bonds) would be the indicator most likely to fail. Originally that was because we are in a very non-inflationary period similar to that which […]
Gimme shelter update: housing purchase affordability Let’s update one measure of housing prices: comparing of the purchasing power of buyers vs. the price a typical house. There are at least 3 indexes. First, here is the N.A.R.’s “Housing affordability index,” updated through May. This compares their estimate of median household income vs. the median price […]
Further comments about the state of the housing market Here are some additional salient comments about the housing market right now. 1. Existing home sales are completely stagnant Not only did existing home sales fall for the month, not only are they down slightly YoY, but they are now less than 2% higher than where […]
Preponderance of evidence from poor housing permits points to slowdown in GDP The preponderance of evidence, based on this morning’s report on housing permits and starts, is that increased interest rates and continuing increased prices are beginning to take a bite out of the market. First of all, let’s take a look at single family […]
Prime age employment participation and wages: not so clear a relationship In the last couple of months variations of the same graph which is supposed to “solve” the wage conundrum have been going around. I saw another version this weekend: Easy to see, there is what looks like a nice, nearly linear relationship between the […]
Children make the bestest hostages Criticisms of Trump in the business press are especially instructive, because they have no obvious partisan motivation. So Josh Barro’s article at Business Insider this morning, castigating his “bully-and-threaten approach to dealmaking,” is particularly noteworthy. He writes: Donald Trump has a negotiating tactic he really likes: Threaten to do something someone else […]
May industrial production: meh Industrial production is the ultimate coincident indicator. It is almost invariably the number that determines economic peaks and troughs. In May it declined -0.1%. While that obviously isn’t a positive, it does nothing to suggest any sort of change of trend: and is in line with any number of similar monthly […]
May retail sales come in strong Real retail sales for May came in strong, up +0.6% just in the month: As the graph shows, this is on trend for the entirety of this expansion, and is also a new high, surpassing that of last winter. Per capita real retail sales also made a new high, […]
Chewing over the message of online job postings Here’s an interesting graph I came across yesterday. It’s from the Conference Board. What it does is track the number of job postings online, and breaks them down between first postings and repeat postings: Let me say first of all that it is of limited use. The […]