Economic Reports 09/18/07

Summary: Foreign cash inflows drying up as the dollar & real estate dive.

Headline PPI down on energy price drop, with crude heading for $90, the drop is a one off event.

Crude non food materials up 19.7% YOY as stagflation goes ballistic. A slowdown in the supply chain is evidenced through margins.

FOMC policy statement & Wells Fargo/NAHB Housing Market Index later today.

TIC Data - Net Foreign Purchases Jul $19.2B vs prior $120.9B
Full Report

Inside the number: Net Official purchases (central banks) falling from 27.8 to 4.4 Billion, net sellers on treasuries -6.9 Billion.

Net Private purchases 20.3 vs 91.3 Billion, net sellers on treasuries -2.4 vs 18.2 Billion.

PPI Aug -1.4% vs prior + 0.6%
Full Report

Inside the number: Core PPI Aug +0.2% vs prior +0.1%; energy -6.6% with gasoline falling -13.8%.

Sequential: Intermediate goods -1.2% vs +0.6%; intermediate core goods -0.5%; crude goods -3% vs +1.3%; crude core goods +1.3%. Beef +2.3%; Finished consumer goods ex food & energy +0.2%

Pull back in manufacturing reflected by decelerating materials prices: Non durable manufacturing -1.1% (organic chemicals -7%); Durable manufacturing -1.5% (cold rolled steel -17.4%)

Less goods getting shipped: Net Output of Total Transportation and Warehousing decelerating +0.4% vs 1.3%.

Prices of staples rising: net output gain (or margins received) by merchant wholesalers of nondurable goods +4.5%;

YOY net output gain: Food Mfg +8.5%; wholesalers non durable +7.1%; electronics & appliances +14.8%; non store retailers +7.8%; gasoline stations +61.8%

Ex food & energy YOY: finished goods +2.2%; consumer foods +4.7%; intermediate goods +2.9%; crude goods +6.9%...

Stagflation in the supply chain YOY: crude materials for manufacturing +8.1%; materials for food manufacturing +12.3%; crude non food materials +19.7%; less energy +13.9%.

Eggs +43%; Rice +11.5%; Chickens +11.3%; Fish +12.8%; Dairy +28.6%; Flour +25.7%; Computers -23.9%.

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