Economic Reports 02/16/07
Summary: Gullible consumer sentiment back down, ho-hum... Wholesale prices on the rise, advertised PPI falling on a large energy price drop, but Core PPI still rising.
Housing starts plunged as builders are scaling back their plans on a massive scale, aiming to work down the excess inventory of unsold homes on the market.
Mich Sentiment-Prel. Feb 93.3 vs prior 96.9 - Ho Hum....
PPI Jan -0.6% vs prior +0.9% Full Report
Inside the number: Despite all the gerrymandering of the numbers by the ministry of disinformation, there isn't enough lipstick in the world to make this pig pretty....
A 13% drop in gasoline prices pulled down PPI, but Core PPI is still rising, Jan +0.2% vs prior +0.2%. At the heart of the matter...
produce prices rose +0.9%, basic industrial materials rose +1.6%, crude goods rose +1.1%, all on target for the REAL annual inflation rate of +12 to 15%.
Housing Starts Jan -14.8% to 1.408M vs prior 1.642M - Full Report
Inside the number: FYI, these are seasonally adjusted numbers which reflect an annualized rate, and the weather was unseasonally nice...
The fewest housing starts since August 1997, down 37.8% YOY, the largest YOY decline since 1991. Starts in the West -28%, the largest drop since 1979.
Nationwide SFR starts -11.2% to 1.108M the lowest since Aug 1997. A silver cloud? the real tell of future development Building Permits Jan -2.8% to 1.568M vs prior 1.613M annualized.
However, upon further review unadjusted SFR permits in June 2005 an all time high 1.662M, down to 793K in Jan 07, a 52% drop. And yes it gets worse...
2005 1.682M SFR's permitted, 2006 1.380M for a 18% drop. To prove this is not a singular anomaly, between June 05 & Aug 06, average unadjusted SFR permits was 1.35M.
Between Sept 06 & Jan 07 that average has dropped to 850K, for another 37% drop or 500K less homes being built in 2007.
Now, that's called going over a cliff in flames. In all this confusion, the questions you have to ask yourself are:
How many less jobs does that make? and what will happen when inventories increase, and lower interest rates don't help? Partial Answer: prices will erode further.
Housing starts plunged as builders are scaling back their plans on a massive scale, aiming to work down the excess inventory of unsold homes on the market.
Mich Sentiment-Prel. Feb 93.3 vs prior 96.9 - Ho Hum....
PPI Jan -0.6% vs prior +0.9% Full Report
Inside the number: Despite all the gerrymandering of the numbers by the ministry of disinformation, there isn't enough lipstick in the world to make this pig pretty....
A 13% drop in gasoline prices pulled down PPI, but Core PPI is still rising, Jan +0.2% vs prior +0.2%. At the heart of the matter...
produce prices rose +0.9%, basic industrial materials rose +1.6%, crude goods rose +1.1%, all on target for the REAL annual inflation rate of +12 to 15%.
Housing Starts Jan -14.8% to 1.408M vs prior 1.642M - Full Report
Inside the number: FYI, these are seasonally adjusted numbers which reflect an annualized rate, and the weather was unseasonally nice...
The fewest housing starts since August 1997, down 37.8% YOY, the largest YOY decline since 1991. Starts in the West -28%, the largest drop since 1979.
Nationwide SFR starts -11.2% to 1.108M the lowest since Aug 1997. A silver cloud? the real tell of future development Building Permits Jan -2.8% to 1.568M vs prior 1.613M annualized.
However, upon further review unadjusted SFR permits in June 2005 an all time high 1.662M, down to 793K in Jan 07, a 52% drop. And yes it gets worse...
2005 1.682M SFR's permitted, 2006 1.380M for a 18% drop. To prove this is not a singular anomaly, between June 05 & Aug 06, average unadjusted SFR permits was 1.35M.
Between Sept 06 & Jan 07 that average has dropped to 850K, for another 37% drop or 500K less homes being built in 2007.
Now, that's called going over a cliff in flames. In all this confusion, the questions you have to ask yourself are:
How many less jobs does that make? and what will happen when inventories increase, and lower interest rates don't help? Partial Answer: prices will erode further.
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