Economic Reports 02/28/07
Summary: Chicago area manufacturing in contraction for the 2nd straight month with escalating prices.
GDP below 3% for the 3rd straight quarter with the housing and automotive sector's demise having a huge impact.
New home sales, falling further with building inventories, no pun intended.
Chicago PMI Feb 47.9 vs prior 48.8 Full Report
Inside the number: Seasonally adjusted... Production down to 51 vs 54, prices paid up to 63.2 vs 54.9, inventories up to 54.4 vs 41.9.
Silver lining??? New orders up to 48.7 vs 46.3, employment up to 50.6 vs 42.8.
GDP-Prel. Q4 +2.2% vs prior +3.5% Full Report
Inside the number: Lowered consumer spending, and slower investments in homes, businesses and inventories were a major drag on growth in Q4.
Gross private domestic investment shrunk from -0.8% to -15.6% in Q4 shaving 2.78% off growth. Business investments -2.4%, investments in equipment and software -3.2%.
Investments in housing -19.2%, the largest decline in housing investment since 1991.
Fixed investments subtracted 1.4 % points from growth. Motor vehicle output shrank 33% in Q4, GDP ex auto +3.6%.
Gross private domestic residential investment has fallen from +8.6% in 2005 to -4.2% in 2006, a 12.8% change.
The increase in consumer spending is due to price increases. The actual volume of goods purchased declined.
How do we know this? Imported goods price index fell 10.1%, due to crude falling to $50. Crude costs aside...
Personal Consumption Expenditures rose from 2.8 to 4.2 while Current dollar measure gross domestic purchases shrank from 4.2 to 0.8.
In addition, the Table 7 annual % growth in final sales and gross domestic purchases all shrank.
The Fed's favorite measure of inflation and a prime example of statistical truncation: Chain Deflator-Prel. Q4 PCE +1.9% vs prior +1.5%.
The personal consumption expenditure price index excluding food and energy, rose at a 1.9% annualized rate.
In the past year, the core PCE price index has risen 2.2%, wink-wink, nudge-nudge, guffaw-guffaw... just stick a "1" in front for the real number 12.2%...
New Home Sales Jan -16.6% 937K vs prior 1123K Full Report
Inside the number: The lowest sales pace since 2002 and the largest % decline since Jan 1994. The inventory of new homes available for sale rose 19.3% to 6.8 months.
Completed but unsold homes rose to 175,000, up 47% YOY. Sales last month: West -37.4 %, Northeast, -18.7 %; Midwest - 8.1% ; South -9.7%.
YOY Median price -2.7%. YOY Sales -20.1%; West -50%; the largest drop since 1981, South -11%, Northeast -2%, Midwest -1%.
FYI, 27 lenders have imploded since Dec 2006, thats less than 60 days... take a look here for full details on the carnage and a list of who's on deck...
GDP below 3% for the 3rd straight quarter with the housing and automotive sector's demise having a huge impact.
New home sales, falling further with building inventories, no pun intended.
Chicago PMI Feb 47.9 vs prior 48.8 Full Report
Inside the number: Seasonally adjusted... Production down to 51 vs 54, prices paid up to 63.2 vs 54.9, inventories up to 54.4 vs 41.9.
Silver lining??? New orders up to 48.7 vs 46.3, employment up to 50.6 vs 42.8.
GDP-Prel. Q4 +2.2% vs prior +3.5% Full Report
Inside the number: Lowered consumer spending, and slower investments in homes, businesses and inventories were a major drag on growth in Q4.
Gross private domestic investment shrunk from -0.8% to -15.6% in Q4 shaving 2.78% off growth. Business investments -2.4%, investments in equipment and software -3.2%.
Investments in housing -19.2%, the largest decline in housing investment since 1991.
Fixed investments subtracted 1.4 % points from growth. Motor vehicle output shrank 33% in Q4, GDP ex auto +3.6%.
Gross private domestic residential investment has fallen from +8.6% in 2005 to -4.2% in 2006, a 12.8% change.
The increase in consumer spending is due to price increases. The actual volume of goods purchased declined.
How do we know this? Imported goods price index fell 10.1%, due to crude falling to $50. Crude costs aside...
Personal Consumption Expenditures rose from 2.8 to 4.2 while Current dollar measure gross domestic purchases shrank from 4.2 to 0.8.
In addition, the Table 7 annual % growth in final sales and gross domestic purchases all shrank.
The Fed's favorite measure of inflation and a prime example of statistical truncation: Chain Deflator-Prel. Q4 PCE +1.9% vs prior +1.5%.
The personal consumption expenditure price index excluding food and energy, rose at a 1.9% annualized rate.
In the past year, the core PCE price index has risen 2.2%, wink-wink, nudge-nudge, guffaw-guffaw... just stick a "1" in front for the real number 12.2%...
New Home Sales Jan -16.6% 937K vs prior 1123K Full Report
Inside the number: The lowest sales pace since 2002 and the largest % decline since Jan 1994. The inventory of new homes available for sale rose 19.3% to 6.8 months.
Completed but unsold homes rose to 175,000, up 47% YOY. Sales last month: West -37.4 %, Northeast, -18.7 %; Midwest - 8.1% ; South -9.7%.
YOY Median price -2.7%. YOY Sales -20.1%; West -50%; the largest drop since 1981, South -11%, Northeast -2%, Midwest -1%.
FYI, 27 lenders have imploded since Dec 2006, thats less than 60 days... take a look here for full details on the carnage and a list of who's on deck...
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