The Market Ticker
Commentary on The Capital Markets
Posted 2013-01-17 11:27
by Karl Denninger
in Macro Factors
Philly Fed: So Much For Improvement
Well that was short-lived.
Manufacturing activity declined moderately this month, according to firms responding to the January Business Outlook Survey. Following reported increases in business activity in late 2012, most indicators fell back from the readings posted last month. The survey's broad indicators of future activity, however, showed some improvement this month.
The diffusion index, if you remember, was positive last month. I was guarded optimistic that we might have seen at least somewhat of a local bottom. Nope. It's -5.8 this month.
We have a serious problem here; New Orders collapsed to -4.3 from 4.9. Shipments went flat and the rest of the internals look like #$%$ as well.
Probably most important to the economy, both employees (-5.2 from -0.2) and workweek (-8.3 from 0.4) went strongly negative.
This is a #$%$ report. The six month forward expectations are somewhere north of fantasy land, with the biggest surprises being in new orders, shipments and prices received and paid, all of which are ridiculously above current levels.
In addition note that the "fiscal policy developments" (a special question in this survey) were cited as reducing hiring plans by 37% of the respondents, with 49.3% saying it made no change.
We are back to sucksville for January folks; Richmond ought to be very interesting.