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The Dismal Economic Reports Continue!

  • Written by Syndicated Publisher No Comments Comments
    May 17, 2013

    I haven’t been remarking much lately about the several months of worsening economic reports that clearly indicate how the economy is stumbling again this year as we enter the summer months. What would be the point. Unlike the last three years, the stock market doesn’t seem to care this year.

    But the negative surprises in the reports continue. The list was long in March and April, and continues in May.

    Two weeks ago it was that Consumer Spending was up only 0.2% in March, the smallest gain since December. The Dallas Fed’s Mfg Index plunged from +7.4 in March to –15.6 in April. Its new orders index fell from +9.5 to –4.9. The Chicago PMI Index fell from 52.4 in March to 49.0 in April, its lowest level in in 3 1/2 years, while its index of new orders plunged from 45.0 to 40.6. The national ISM Mfg Index fell to 50.7 in April from 51.3 in March, remaining barely above the 50 level that separates expansion from recessionary contraction.

    Since then it has been that the Empire State (NY) Mfg Index fell into negative territory in May, falling from +3.1 in April to -1.4 in May. And nationally, Industrial Production fell 0.5% in April.

    This morning it was updates from the two areas that had been providing some hope, housing and employment. And unfortunately they have joined the long list of negative surprises.

    New housing starts plunged a huge 16.5% in April to an annual rate of 853,000, the lowest level since November. (Not that it bothers Wall Street or the market, with analysts focused instead on the 14.3% increase in permits for future starts).

    And new weekly unemployment claims unexpectedly surged up by 32,000 last week to 360,000, the highest level in a month and a half. The consensus forecast was for only 330,000 claims. (But the focus is on the 4-week m.a. which rose only 1,250 to 339,250).

    So the months-long string of negative reports continues to indicate the economy is stumbling, as it has in each of the last three summers.

    In each of the last three years the result was double-digit declines by the S&P 500 of up to 21%, until each time the Fed rushed to the rescue with promises of another round of QE stimulus.

    The market doesn’t seem at all concerned by the stumbling economy this time, repeatedly closing at new record highs.

    But the economy is still slowing, and commodity prices, a bellwether for the economy, are still collapsing, as they did in each of the last three years.


    To read my weekend newspaper column click here:  It’s Still Fool’s Gold For A While Yet!

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    Images: Flickr (licence attribution)

    About The Author


    Sy Harding publishes the financial website Street Smart Report Online and a free daily Internet blog at Sy’s Free Blog. In 1999 he authored Riding The Bear – How To Prosper In the Coming Bear Market. His latest book is Beat the Market the Easy Way! – Proven Seasonal Strategies Double Market’s Performance!

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