This week looks to be another whirlwind week of significant economic releases coming from the consumer and housing sectors, along with an update on 2Q09 GDP growth. In addition to this, Monday will see the end of the US government’s highly successful ‘Cash for Clunkers’ program, which over the course of its existence has positively […]
Archive:
August 2009
July’s existing home sales rose to a rate of 5.24mn, compared to the previous months rate of 4.89mn homes, and a consensus forecast of 5.00mn. This is the biggest monthly gain since 1999. The inventory of new homes remained unchanged at 9.4 months. The median price for existing home was down 2.0% during the month, […]
Updating yesterday’s theme I was able to collect monthly new lending data from China. The chart below shows the relationships between new lending in China and the BDI. A recent decline of new lending in China is a likely factor behind the recent pullback in shipping rates and Chinese equity markets. The decline in Chinese […]
According to the Mortgage Bankers Association this morning, US mortgage delinquencies rose to a record rate of 9.24% of all loans outstanding. At the same time, the rate of foreclosures fell slightly to 1.36% from 1.37%. What is interesting is that the rate of foreclosures actually fell for sub-prime ARMs, but rose for more traditional […]
July’s leading economic indicators index rose 0.6%, experiencing its fourth consecutive month of gains. The Bloomberg consensus forecast was for an increment of +0.7%. Rate spread, claims, and manufacturing hours all made positive contributions, while consumer expectations, M2, and permits were the biggest negative contributors. The LEI tends to be a good forward looking indicator […]
A reader recently brought to my attention the fact that the BDI and the Shanghai Composite Index both appeared to have peaked from interim-term highs at the beginning of August (see chart). After looking more closely at the data I quickly began to realize the significance of this relationship and its implications on shipping. Let […]
Initial jobless claims rose this morning by 15K to 576K compared to last week’s number revised number of 561K, and a consensus forecast of 550K. This is the second consecutive week claims have unexpectedly risen. The 4wk moving average moved up by 4,250 to 570K. Despite the rise over the past two weeks, claims should […]
Andy Xie is a former economist with Morgan Stanley who correctly called the correction in Chinese markets in April 2007. He recently wrote a very interesting article on the current state of China’s markets, which I believe holds merit and significant implications. This is a highly recommended read for anyone interested. Here is his article: […]
The market generally accepts that over the months’ ahead companies will begin restocking dwindling inventories. In fact Goldman Sachs recently updated their 2H09 GDP forecast to 3.0% from 1.0% on the back of expected inventory restocking. This will undoubtedly have a positive effect on US industrial Production, manufacturing, and ultimately US GDP growth for a […]
Housing starts fell to 0.581 in July compared to 0.587mn. This number was slightly below the market consensus. The 1% drop in starts comes after a 10% increase in July. Single family starts actually rose 1.7%, but this was more than offset by a 13% decline in multi-family starts. Starts fell 16% in the Northeast, […]