Posts Tagged ‘PPI’
In the week ending December 8, the advance figure for seasonally adjusted initial claims was 343,000, a decrease of 29,000 from the previous week’s revised figure of 372,000. The 4-week moving average was 381,500, a decrease of 27,000 from the previous week’s revised average of 408,500.
Let’s have a peek at the big table….
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Retail Trade: Uh, Where’s The Sales?
The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for November, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $412.4 billion, an increase of 0.3 percent (±0.5%)* from the previous month and 3.7 percent (±0.7%) above November 2011. Total sales for the September through November 2012 period were up 4.3 percent (±0.5%) from the same period a year ago. The September to October 2012 percent change was unrevised from -0.3 percent (±0.2%).
I don’t like this number much, albeit the headline number looks ok.
It’s all autos — ex-autos the number was flat.
The bigger issue is that food and bevereage and general merchandise (think “department stores”) were both down, with the latter down 0.9% monthly. November includes Black Friday!
Online’s share continued to increase, however. I guess if there’s a “bright spot” it’s there.
Note that without seasonal adjustment the figures for general merchandise were up, but they darn well better be given the “start of the holiday season.”
My overall take? Shrug.
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PPI: -0.8% (!)
The Producer Price Index for finished goods fell 0.8 percent in November, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Prices for finished goods decreased 0.2 percent in October and rose 1.1 percent in September. At the earlier stages of processing, prices received by manufacturers of intermediate goods declined 1.2 percent in November, and the crude goods index edged up 0.1 percent. On an unadjusted basis, the finished goods index advanced 1.5 percent for the 12 months ended November 2012, the smallest increase since a 0.5-percent rise for the 12 months ended July 2012. (See table A.)
Ah, a look inside tells the tale — the bottom line is that it’s all energy. Foods were up 1.%; ex-food and energy the index was up 0.1%, or basically flat.
Of course nobody actually eats anything, right?
Within the internals trend shifts are evident in energy prices, which is good (they’re coming down) but the paradox is that this usually signals internal economic weakness.
The interesting internal trend here is the compression of margins in the food category, which now has been going on since July. This too is an indicator of economic weakness.
There’s nothing that stands out in this report, other than those two markers — but they are simply further confirmation of the regional fed indices that I’ve been warning about since the summer.
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PPI: -0.2%; Are We All Clear?
The Producer Price Index for finished goods declined 0.2 percent in October, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Prices for finished goods increased 1.1 percent in September and 1.7 percent in August. At the earlier stages of processing, prices received by manufacturers of intermediate goods edged down 0.1 percent in October, and the crude goods index moved up 0.9 percent. On an unadjusted basis, the finished goods index advanced 2.3 percent for the 12 months ended October 2012, the largest rise since a 2.8-percent increase for the 12 months ended March 2012. (See table A.)
Hmmmm… The table shows a 0.4% increase in foods, offset by a 0.5% decrease in energy and a -0.2% decrease in everything else.
The decrease was led in the core by a decrease in pricing for new vehicles. That’s an interesting change in trend, and may indicate that pricing power has exhausted in the vehicle space. If so the results in the car makers over the next three or so months should be apparent.
One month does not make a trend, but this is not positive.
The other interesting point is that crude goods, which had been decreasing through the “belly” of 2012, were basically flat-lined on a 12-month basis while Intermediate goods on core were flat as well.
The report is overall neutral with one cautionary note, and that is to watch the autos in December and January when the retail trade figures come out for those months to see if this bleeds through into final demand.
Retail Sales: -0.3%
The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for October, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $411.6 billion, a decrease of 0.3 percent (±0.5%)* from the previous month, but 3.8 percent (±0.7%) above October 2011. Total sales for the August through October 2012 period were up 4.7 percent (±0.5%) from the same period a year ago. The August to September 2012 percent change was revised from 1.1 percent (±0.5%) to 1.3 percent (±0.2%).
Retail trade sales were down 0.3 percent (±0.5%)* from September 2012, but 3.8 percent (±0.8%) above last year. Gasoline stations sales were up 7.7 percent (±1.7%) from October 2011 and nonstore retailers were up 7.2 percent (±3.0%) from last year.
I find this an interesting report for a number of reasons, with one of the most-interesting being the distribution of gains. For example, the gross gain from October 2011 was $20.418 billion.
Gasoline was $3.76 billion of that increase. Autos were $5.955 billion; between the two that was nearly half of the advance.
In general the report was quite a bit more-solid that I had originally expected, given that Sandy was in there. Another point is that unadjusted sales were actually up 3.5% — so beware the so-called “seasonal adjustments” as well.
Verdict: Neutral to mildly-positive, which probably explains the market basically ignoring the release.
The Producer Price Index for finished goods increased 1.6 percent in February, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This rise followed advances of 0.8 percent in January and 0.9 percent in December, and marks the largest increase in finished goods prices since a 1.9-percent advance in June 2009. At the earlier stages of processing, prices received by manufacturers of intermediate goods moved up 2.0 percent, and the crude goods index climbed 3.4 percent. On an unadjusted basis, prices for finished goods advanced 5.6 percent for the 12 months ended February 2011, the largest 12-month increase since a 5.9-percent rise in March 2010. (See table A.)
Ugh. There’s no way to read this one as “good”. Here’s the awful table:
Food and energy hits poor people disproportionately, and these are monthly numbers, not annualized ones. At an annualized rate these numbers are comparable, if they continue to run this way, to that which caused the uprisings in Egypt!
Just as bad is the fact that we’re now seeing sustained and serious rises in both crude and intermediate goods and it is not transitory, carrying forward the pattern we’ve seen over the last six months or so. Crude goods moved first, as I started to outline last summer, then intermediate.
The upcoming CPI release will be very interesting but thus far The Fed and Congress have, of course, been tone-deaf to the impact of their attempts to cover over the insolvencies that in fact exist in the economy. The gambit, as I have repeatedly pointed out, is to continue to play this game in the hope that private consumption and production would recover. By providing government “cheese” to the masses, private consumption can be “faked” – for a while. But we’re now to the point that 30% of all paychecks are coming from government subsidy and there’s no sign that the private economy is “taking back” the lead from the public sector.
We must recognize the underlying facts – “excess capacity” in the economy is not a function of some transitory nonsense. It is, rather, the result of massive ponzi-style financial game-playing and cannot be sustained. The private sector cannot recover and return to health until and unless the government withdraws the artificial support and allows those firms that are insolvent to be recognized as insolvent, clearing the bad debts from the system.
The upward pressure from those who have and will scream about losing their “free stuff” will continue to rise to deafening levels. But the response to irrefutable economic facts, which just are whether you like them or not, is what separates those who are leaders from those who will destroy our nation and its economy.
Today we have no leaders and no advocates for the truth. We had better find some and do so soon, because the time for us to make elective choices in this regard and determine by some sort of representative process exactly how we’re going to face the reality that we cannot hand out 1/3rd of all earnings dollars from government transfer payments is coming to a close.
Following that time our realignment of priorities will be not a matter of choice but instead will be forced upon us.
That day is rapidly approaching and leadership from Washington, particularly from Congress and The Fed, is as of this point in time utterly absent.