Economic Reports 08/08/07
Summary: GM & NAR trimming estiamtes again, MBA apps show a mad rush to get in under the jumbo money wire. Toll Brothers warning about the obvious.
Bogus Chinese trade sanction rumours abound. Wholesale Inventories showing decelerating sales & double digit stagflation.
GM, formerly the largest U.S. automaker, lowered its forecast for U.S. industrywide sales of cars and trucks, citing the weaker market and higher gasoline prices.
NAR trimmed its home sales forecast for the 6th straight month, down to 6.04M units vs Junes est. 6.11 M, a new 5 year low.
National median sales price for existing homes down 1.2% to $219,300 vs prior -1.4%.
New-home sales est. 852,000K vs 1.05M in 2006. Housing starts, including multifamily units, est. 1.43M in vs 1.80M in 06. The Nattering One estimates 1.2M or 600K less homes being built.
MBA said mortgage applications rose +8.1%; the 1st time in 3 weeks to their highest level since early June. Apps are +18% YOY.
AIG will post Q2 results after the bell. The treasury has a 10 yr note auction later today.
BS rumour mill: should the US pass protectionist tariffs, the Chinese will liquidate their US treasury holdings. NOT!!
Toll Brothers warns revenues -21%; backlog -34%; cancellation rate up to 23.8% vs 18.9%. CEO Robert Toll stating the obvious:
“With the uncertainties roiling the mortgage markets right now, the pace of home sales could slow further until the credit markets settle down.
In the near term, tightening credit standards for borrowers should reduce the pool of potential buyers.
Liquidity and affordability issues may impede some customers from closing, while others may find it more difficult to sell their existing homes.
Excess supply exists in most markets and there is concern that additional inventory will emerge due to mortgage defaults.”
Wholesale Inventories Jun +0.47% vs prior +0.46% Full Report
Inside the number: Wholesale sales decelerating +0.59% vs prior +1.33% and non durable inventories building +1.24% as spending slows. Sequentially:
Durable goods; sales +0.72% vs prior -0.38%, inventories +0.02% vs prior +0.43%.
Non durable goods; sales +0.47% vs prior +2.91%; inventories +1.24% vs prior +0.50%.
YTD Seasonally Adjusted and NOT adjusted for price changes (this shows price stagflation):
Durable goods inventories building faster than sales. Non durable goods showing double digit stagflation.
Wholesale Sales +7.87%; Wholesale Inventories +7.56%.
Durable goods: Sales +5.53%; Inventories +6.43%
Non durable goods: Sales +10.16%; Inventories +9.57%
Bogus Chinese trade sanction rumours abound. Wholesale Inventories showing decelerating sales & double digit stagflation.
GM, formerly the largest U.S. automaker, lowered its forecast for U.S. industrywide sales of cars and trucks, citing the weaker market and higher gasoline prices.
NAR trimmed its home sales forecast for the 6th straight month, down to 6.04M units vs Junes est. 6.11 M, a new 5 year low.
National median sales price for existing homes down 1.2% to $219,300 vs prior -1.4%.
New-home sales est. 852,000K vs 1.05M in 2006. Housing starts, including multifamily units, est. 1.43M in vs 1.80M in 06. The Nattering One estimates 1.2M or 600K less homes being built.
MBA said mortgage applications rose +8.1%; the 1st time in 3 weeks to their highest level since early June. Apps are +18% YOY.
AIG will post Q2 results after the bell. The treasury has a 10 yr note auction later today.
BS rumour mill: should the US pass protectionist tariffs, the Chinese will liquidate their US treasury holdings. NOT!!
Toll Brothers warns revenues -21%; backlog -34%; cancellation rate up to 23.8% vs 18.9%. CEO Robert Toll stating the obvious:
“With the uncertainties roiling the mortgage markets right now, the pace of home sales could slow further until the credit markets settle down.
In the near term, tightening credit standards for borrowers should reduce the pool of potential buyers.
Liquidity and affordability issues may impede some customers from closing, while others may find it more difficult to sell their existing homes.
Excess supply exists in most markets and there is concern that additional inventory will emerge due to mortgage defaults.”
Wholesale Inventories Jun +0.47% vs prior +0.46% Full Report
Inside the number: Wholesale sales decelerating +0.59% vs prior +1.33% and non durable inventories building +1.24% as spending slows. Sequentially:
Durable goods; sales +0.72% vs prior -0.38%, inventories +0.02% vs prior +0.43%.
Non durable goods; sales +0.47% vs prior +2.91%; inventories +1.24% vs prior +0.50%.
YTD Seasonally Adjusted and NOT adjusted for price changes (this shows price stagflation):
Durable goods inventories building faster than sales. Non durable goods showing double digit stagflation.
Wholesale Sales +7.87%; Wholesale Inventories +7.56%.
Durable goods: Sales +5.53%; Inventories +6.43%
Non durable goods: Sales +10.16%; Inventories +9.57%
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