Economic Reports 05/02/07
Summary: The Nattering One hates to ruin a party in progress... but... the media spin "a revival in capital spending"? We think not....
The malodorousness of unsavory disinformation wafts our way and we endevour to dig up a truffle or two... and explain why that isn't warm rain falling on your head... really.
Factory Orders Mar +3.1% vs prior +1.4% Full Report
Inside the number: Total shipments +0.8%; Feb revised up to 1.4% from 1%.
This months gain on +37.6% civilian aircraft orders lifting transportation +8%; and on construction machinery orders +65%.
Unfilled orders rising for 22 of 23 months +1.8% on aircraft orders.
A better gauge, ex-transportation: Factory Orders +1.5%; Shipments +0.3%. But, non durable goods shipments & orders +2.8% on an 11% increase in petroleum.
Good news? Core Capital Equipment orders +4.8%; shipments +0.6%. Durable goods +3.4%; shipments +0.8%.
Both rises seem healthy, because if your at zero or negative the only direction is up. And remember, spring sprung early in March...
Ferreting out the Bad News Truffles (Table 5):
CCE (which are non defense capital goods excluding transportation, and the best gauge of capital spending and how the industry captains see things)
YTD core capital equipment inventories +7.2%; unfilled orders +17.5%; orders -0.6%; shipments -0.5%.
Then consumer durable goods for how the average Joe sees things:
YTD consumer durable goods inventories +4%; unfilled orders -5.5%; shipments -6%; orders -5.5%
Inventories building for 12 of 13 months +0.2% pushing the durable goods unfilled orders to shipments ratio to an unheard of 4.92.
Translated: YTD CCE orders and shipments are down, inventory is building and unfilled backorders are growing.
Slower deliveries and inventory build are indicative of a slowing economy. What else tells us its slowing?
The YTD consumer durable goods numbers, same deal as above, except its worse because unfilled orders are decreasing meaning the pipeline is running dry.
The captains would rather buyback stock to boost earnings per share and wow investors than make capital expenditures to facilitate expansion or increase productivity into a slowing economy.
Bad news for defense contractors:
Defense capital goods orders -16%. Defense aircraft & parts shipments -2.8%; new orders -48.8%; Yoy -28.1%.
Bad news for Semis:
Computers & Electronic Products shipments -3.4%; Yoy -1.1%; orders -0.1%; Yoy -1.7%.
Computers & Related shipments -8%; Yoy -5.2%; YTD -5.5%; orders -4.2%; Yoy -3.7%Semiconductor shipments -10.4%;Yoy -6.7%
Computers & Electronics Yoy Finished Goods +11%
Bad news for housing:
Yoy: wood products shipments -19.6%; inventories -4%
Yoy: construction machinery shipments -30.8%; orders -19.1%
Yoy: furniture orders -4.8%; unfilled orders -4.6%
Yoy: household appliance orders -6.6%; inventories -4%
Bad news for automotive:
YTD MV & parts shipments -6.2%; orders -7.1%; unfilled +9.7%; inventories +3.9%
Yoy shipments: autos -2%; light trucks -13.6%; heavy trucks -14.6%.
Yoy inventories: autos +21.2%; light trucks +1.7%; heavy trucks +11%
Yoy unfilled orders iron & steel mills -4.6%
Sorry to ruin the party... but that warm "rain" appears to be a bit jaundiced.
The malodorousness of unsavory disinformation wafts our way and we endevour to dig up a truffle or two... and explain why that isn't warm rain falling on your head... really.
Factory Orders Mar +3.1% vs prior +1.4% Full Report
Inside the number: Total shipments +0.8%; Feb revised up to 1.4% from 1%.
This months gain on +37.6% civilian aircraft orders lifting transportation +8%; and on construction machinery orders +65%.
Unfilled orders rising for 22 of 23 months +1.8% on aircraft orders.
A better gauge, ex-transportation: Factory Orders +1.5%; Shipments +0.3%. But, non durable goods shipments & orders +2.8% on an 11% increase in petroleum.
Good news? Core Capital Equipment orders +4.8%; shipments +0.6%. Durable goods +3.4%; shipments +0.8%.
Both rises seem healthy, because if your at zero or negative the only direction is up. And remember, spring sprung early in March...
Ferreting out the Bad News Truffles (Table 5):
CCE (which are non defense capital goods excluding transportation, and the best gauge of capital spending and how the industry captains see things)
YTD core capital equipment inventories +7.2%; unfilled orders +17.5%; orders -0.6%; shipments -0.5%.
Then consumer durable goods for how the average Joe sees things:
YTD consumer durable goods inventories +4%; unfilled orders -5.5%; shipments -6%; orders -5.5%
Inventories building for 12 of 13 months +0.2% pushing the durable goods unfilled orders to shipments ratio to an unheard of 4.92.
Translated: YTD CCE orders and shipments are down, inventory is building and unfilled backorders are growing.
Slower deliveries and inventory build are indicative of a slowing economy. What else tells us its slowing?
The YTD consumer durable goods numbers, same deal as above, except its worse because unfilled orders are decreasing meaning the pipeline is running dry.
The captains would rather buyback stock to boost earnings per share and wow investors than make capital expenditures to facilitate expansion or increase productivity into a slowing economy.
Bad news for defense contractors:
Defense capital goods orders -16%. Defense aircraft & parts shipments -2.8%; new orders -48.8%; Yoy -28.1%.
Bad news for Semis:
Computers & Electronic Products shipments -3.4%; Yoy -1.1%; orders -0.1%; Yoy -1.7%.
Computers & Related shipments -8%; Yoy -5.2%; YTD -5.5%; orders -4.2%; Yoy -3.7%Semiconductor shipments -10.4%;Yoy -6.7%
Computers & Electronics Yoy Finished Goods +11%
Bad news for housing:
Yoy: wood products shipments -19.6%; inventories -4%
Yoy: construction machinery shipments -30.8%; orders -19.1%
Yoy: furniture orders -4.8%; unfilled orders -4.6%
Yoy: household appliance orders -6.6%; inventories -4%
Bad news for automotive:
YTD MV & parts shipments -6.2%; orders -7.1%; unfilled +9.7%; inventories +3.9%
Yoy shipments: autos -2%; light trucks -13.6%; heavy trucks -14.6%.
Yoy inventories: autos +21.2%; light trucks +1.7%; heavy trucks +11%
Yoy unfilled orders iron & steel mills -4.6%
Sorry to ruin the party... but that warm "rain" appears to be a bit jaundiced.
Comments