Economic Reports 04/04/07
Summary: Factory orders on the surface a seemingly benign number...
Under the sheets, showing a continued pullback in housing and manufacturing with further deceleration in core capital equipment and construction equipment & supplies.
Mounting backorders reflecting a decided reluctance to make capital business investments, in fear of further deceleration.
ISM services showing that our non durable McJobs economy is getting pulled down; and further erosion in consumer discreationary spending is on the way.
Factory Orders Feb +1% vs prior -5.6% Table 2 & Table 5
Inside the number: Civilian aircraft orders +88.4%, defense aircraft & parts +29.2%. Ex transportation factory orders fell -0.4% and shipments fell -0.5%.
Further deceleration: Capital Goods ex defense & ex aircraft AKA Core capital equipment fell 2.4% Yoy -0.4%. Yoy consumer durable goods -4.7%; Yoy consumer nondurable goods -2.3%.
Housing pullback: Construction machinery fell -9.2% vs prior -37.3%; Yoy -32.6%. Construction materials & supplies fell 1%. Channel OVERstuffed: semiconductor shipments -23.6%
Demonstrating a lack of capital business spending, for fear of additional deceleration: Yoy Backorders are WAY UP:
Manufacturing +20.9%; capital goods +23.9%; ex defense capital goods +29.3%; ex defense & ex aircraft +17.2%.
The reluctance to spend on expansion has resulted in rising inventory to shipments and backorders to shipments ratios since Nov 06.
ISM Services Mar 52.4 vs prior 54.3 Full Report
Inside the number: lowest since April 03. Activity fell to 52.4 from 54.3, new orders fell to 53.8% from 54.8%, employment fell to 50.8% from 52.2%.
Price index rising to 63.3% from 53.8%, inventories rising to 52.0% from 50.5%, backlogs rising to 52.5% from 47.0%
Further contraction: imports fell to 50 from 54; exports fell to 48.5 from 59.
The four industries in contraction are indicative of businesses pulling back due to reduced consumer discretionary spending:
Management of Companies & Support Services; Accommodation & Food Services; Information; and Arts, Entertainment & Recreation.
Under the sheets, showing a continued pullback in housing and manufacturing with further deceleration in core capital equipment and construction equipment & supplies.
Mounting backorders reflecting a decided reluctance to make capital business investments, in fear of further deceleration.
ISM services showing that our non durable McJobs economy is getting pulled down; and further erosion in consumer discreationary spending is on the way.
Factory Orders Feb +1% vs prior -5.6% Table 2 & Table 5
Inside the number: Civilian aircraft orders +88.4%, defense aircraft & parts +29.2%. Ex transportation factory orders fell -0.4% and shipments fell -0.5%.
Further deceleration: Capital Goods ex defense & ex aircraft AKA Core capital equipment fell 2.4% Yoy -0.4%. Yoy consumer durable goods -4.7%; Yoy consumer nondurable goods -2.3%.
Housing pullback: Construction machinery fell -9.2% vs prior -37.3%; Yoy -32.6%. Construction materials & supplies fell 1%. Channel OVERstuffed: semiconductor shipments -23.6%
Demonstrating a lack of capital business spending, for fear of additional deceleration: Yoy Backorders are WAY UP:
Manufacturing +20.9%; capital goods +23.9%; ex defense capital goods +29.3%; ex defense & ex aircraft +17.2%.
The reluctance to spend on expansion has resulted in rising inventory to shipments and backorders to shipments ratios since Nov 06.
ISM Services Mar 52.4 vs prior 54.3 Full Report
Inside the number: lowest since April 03. Activity fell to 52.4 from 54.3, new orders fell to 53.8% from 54.8%, employment fell to 50.8% from 52.2%.
Price index rising to 63.3% from 53.8%, inventories rising to 52.0% from 50.5%, backlogs rising to 52.5% from 47.0%
Further contraction: imports fell to 50 from 54; exports fell to 48.5 from 59.
The four industries in contraction are indicative of businesses pulling back due to reduced consumer discretionary spending:
Management of Companies & Support Services; Accommodation & Food Services; Information; and Arts, Entertainment & Recreation.
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