Monthly Archives: November 2013

Updates Of Economic Indicators November 2013

Here is an update on various indicators that are supposed to predict and/or depict economic activity.  These indicators have been discussed in previous blog posts:

The November 2013 Chicago Fed National Activity Index (CFNAI)(pdf) updated as of November 27, 2013:

cfnai_monthly_MA3 11-27-13

The ECRI WLI (Weekly Leading Index):

As of 11/22/13 (incorporating data through 11/15/13) the WLI was at 132.2 and the WLI, Gr. was at 2.4%.

A chart of the WLI, Gr. since 2000, from Doug Short’s blog of November 22 titled “ECRI Recession Watch:  Weekly Update” :

Dshort 11-22-13 - ECRI-WLI-growth-since-2000 2.4

The Aruoba-Diebold-Scotti Business Conditions (ADS) Index:

Here is the latest chart, depicting 12-31-07 through 11-23-13:

ads_12-31-07 - 11-23-13

The Conference Board Leading (LEI) and Coincident (CEI) Economic Indexes:

As per the November 27 press release, the LEI was at 97.5 and the CEI was at 106.9 in October.

An excerpt from the November 27 release:

“The US LEI has increased for four consecutive months,” said Ken Goldstein, Economist for The Conference Board. “Overall, the data reflect strengthening conditions in the underlying economy. However, headwinds still persist from the labor market, accompanied by business caution and concern about federal budget battles. The biggest challenge to date has been relatively weak consumer demand, which continues to be restrained by weak wage growth and slumping confidence.”

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I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1807.23 as this post is written

St. Louis Financial Stress Index – November 27, 2013 Update

On March 28, 2011 I wrote a post (“The STLFSI“) about the St. Louis Fed’s Financial Stress Index (STLFSI) which is supposed to measure stress in the financial system.  For reference purposes, the most recent chart is seen below.  This chart was last updated on November 27, incorporating data from December 31,1993 to November 22, 2013, on a weekly basis.  The November 22, 2013 value is -.846:

(click on chart to enlarge image)

STLFSI_11-27-13 -.846

Here is the STLFSI chart from a 1-year perspective:

STLFSI_11-27-13 -.846 1-year

Data Source: FRED, Federal Reserve Economic Data, Federal Reserve Bank of St. Louis; accessed November 27, 2013:

http://research.stlouisfed.org/fred2/series/STLFSI

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 1806.07 as this post is written

Durable Goods New Orders – Long-Term Charts Through October 2013

Many people place emphasis on Durable Goods New Orders as a prominent economic indicator and/or leading economic indicator.

For reference, below are charts depicting this measure.

First, from the St. Louis Fed site (FRED), a chart through October, last updated on November 27.  This value is 230,252 ($ Millions) :

(click on charts to enlarge images)

DGORDER_11-27-13 230252

Here is the chart depicting this measure on a “Percentage Change from a Year Ago” basis:

DGORDER_11-27-13 230252 Percent Change From Year Ago

Data Source: FRED, Federal Reserve Economic Data, Federal Reserve Bank of St. Louis: Manufacturers’ New Orders:  Durable Goods [DGORDER] ; U.S. Department of Commerce: Census Bureau ; accessed November 27, 2013;

http://research.stlouisfed.org/fred2/series/DGORDER

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 1806.17 as this post is written

Consumer Confidence Surveys – As Of November 27, 2013

Doug Short had a blog post of November 26 (“Consumer Confidence Declines Again in November“) in which he presents the latest Conference Board Consumer Confidence and Thomson/Reuters University of Michigan Consumer Sentiment Index charts.  They are presented below:

(click on charts to enlarge images)

Dshort 11-27-13 - Conference-Board-consumer-confidence-index

Dshort 11-27-13 - Michigan-consumer-sentiment-index

There are a few aspects of the above charts that I find highly noteworthy.  Of course, the continuing subdued absolute levels of these two surveys is disconcerting.

Also, I find the “behavior” of these readings to be quite disparate as compared to the other post-recession periods, as shown in the charts between the gray shaded areas (the gray areas denote recessions as defined by the NBER.)

While I don’t believe that confidence surveys should be overemphasized, I find these readings to be very problematical, especially in light of a variety of other highly disconcerting measures highlighted throughout this blog.

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1802.75 as this post is written

Philadelphia Fed – 4th Quarter 2013 Survey Of Professional Forecasters

The Philadelphia Fed Fourth Quarter 2013 Survey of Professional Forecasters was released on November 25.  This survey is somewhat unique in various regards, such as it incorporates a longer time frame for various measures.

The survey shows, among many measures, the following median expectations:

Real GDP: (annual average level)

full-year 2013 : 1.7%

full-year 2014 : 2.6%

full-year 2015:  2.8%

full-year 2016:  2.7%

Unemployment Rate: (annual average level)

for 2013: 7.5%

for 2014: 7.0%

for 2015: 6.4%

for 2015: 6.0%

As for “the chance of a contraction in real GDP” in any of the next few quarters, mean estimates are 11.3%, 11.1%, 11.6%, 11.7% and 12.2% for each of the quarters from Q4 2013 through Q4 2014, respectively.

As well, there are also a variety of time frames shown (present quarter through the year 2022) with the median expected inflation of each.  Inflation is measured in Headline and Core CPI and Headline and Core PCE.  Over all time frames expectations are shown to be in the 1.1%-2.3% range.

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I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not agree with many of the consensus estimates and much of the commentary in these forecast surveys.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 1802.48 as this post is written

Food Stamps As Of November 25, 2013

This post is an update to previous posts concerning food stamps.  The program is officially called “Supplemental Nutrition Assistance Program,” or SNAP.  As stated on the SNAP website, “As of Oct. 1, 2008, Supplemental Nutrition Assistance Program (SNAP) is the new name for the federal Food Stamp Program.”

The data was last updated November 8, 2013, reflecting August 2013 levels.

Here is a table showing various monthly statistics with regard to national participation and costs going back to FY2010.  As seen in this table, the number of people participating as of August 2013 is 47,665,069, up 1.19% from year-ago (August 2012) levels.  As a reference point, the figure as of June 2009 (the official end of the recession as defined by the NBER) was (originally stated as) 34,882,031.  Longer-term annual data is also available.

As I wrote in the April 12, 2010 post, “Of course, what is particularly disconcerting is not only the extent of participation in these programs, but the fact that this is yet another notable statistic that is getting worse well after the purported end of the recession.”

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1804.90 as this post is written

Current Economic Situation

With regard to our current economic situation,  my thoughts can best be described/summarized by the posts found under the 30 “Building Financial Danger” posts.

My thoughts concerning our ongoing economic situation – with future implications – can be seen on the page titled “A Special Note On Our Economic Situation,” which has been found near the bottom of every blog post since August 15, 2010.

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1804.83 as this post is written

Long-Term Charts Of The ECRI WLI & ECRI WLI, Gr. – November 22, 2013 Update

As I stated in my July 12, 2010 post (“ECRI WLI Growth History“):

For a variety of reasons, I am not as enamored with ECRI’s WLI and WLI Growth measures as many are.

However, I do think the measures are important and deserve close monitoring and scrutiny.

The movement of the ECRI WLI and WLI, Gr. is particularly notable at this time, as ECRI publicly announced on September 30, 2011 that the U.S. was “tipping into recession,” and ECRI has reiterated the view that the U.S. economy is currently in a recession, seen most recently in these nine sources :

Other past notable year 2012 reaffirmations of the September 30, 2011 recession call by ECRI were seen (in chronological order) on March 15 (“Why Our Recession Call Stands”) as well as various interviews and statements the week of May 6, including:

Also, subsequent to May 2012:

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Below are three long-term charts, from Doug Short’s blog post of November 22, 2013 titled “ECRI Recession Watch:  Weekly Update.”  These charts are on a weekly basis through the November 22 release, indicating data through November 15, 2013.

Here is the ECRI WLI (defined at ECRI’s glossary):

(click on charts to enlarge images)

Dshort 11-22-13 - ECRI-WLI 132.2

This next chart depicts, on a long-term basis, the Year-over-Year change in the 4-week moving average of the WLI:

Dshort 11-22-13 - ECRI-WLI-YoY 4.4 percent

This last chart depicts, on a long-term basis, the WLI, Gr.:

Dshort 11-22-13 - ECRI-WLI-growth-since-1965 2.4

_________

I post various economic indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 1804.76 as this post is written

Trends Of S&P500 Earnings Forecasts

S&P500 earnings trends and estimates are a notably important topic, for a variety of reasons, at this point in time.

FactSet publishes a report titled “Earnings Insight” that contains a variety of information including the trends and expectations of S&P500 earnings.

For reference purposes, here are two charts as seen in the “Earnings Insight” (pdf) report of November 15, 2013:

from page 18:

(click on charts to enlarge images)

CY Bottom-Up EPS vs. Top-Down Mean EPS (Trailing 26-Weeks) 

FactSet Earnings Insight 11-15-13 CY2013 and CY2014

from page 19:

Calendar Year Bottom-Up EPS Actuals & Estimates

FactSet Earnings Insight 11-15-13 CY2000-CY2014

_____

I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not agree with many of the consensus estimates and much of the commentary in these forecast surveys.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 1798.75 as this post is written

S&P500 Earnings Estimates For Years 2013, 2014, And 2015

As many are aware, Thomson Reuters publishes earnings estimates for the S&P500.  (My other posts concerning S&P earnings estimates can be found under the S&P500 Earnings tag)

The following estimates are from Exhibit 12 of “The Director’s Report” (pdf) of November 21, 2013, and represent an aggregation of individual S&P500 component “bottom up” analyst forecasts:

Year 2013 estimate:

$109.47/share

Year 2014 estimate:

$121.72/share

Year 2015 estimate:

$134.14/share

_____

I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not agree with many of the consensus estimates and much of the commentary in these forecast surveys.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 1796.82 as this post is written