Free Markets, Free People

Daily Archives: October 25, 2012

Economic Statistics for 26 Oct 12

The following US economic statistics were announced today:

The Commerce Department reports that the initial estimate for 3rd quarter GDP was that the economy grew at a  lackluster 2.0% annualized pace. The GDP price index rose more than expected, to 2.8%. Government spending was surprisingly positive for the report, as were personal consumption expenditures, led by durable goods. Still, growth is below normal, so the outlook for employment growth is not good.

The Reuter’s/University of Michigan’s consumer sentiment index posted an October reading of 82.6.

Dale Franks
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Economic Statistics for 25 Oct 12

The following US economic statistics were announced today:

Last month’s huge 13.1% drop in durable goods orders rebounded with a 9.9% increase for September, and a 2.0% rise ex-transportation. On a year-over-year basis, orders are up 2.5%, but ex-transportation orders are down –1.6%.

Initial jobless claims for last week were down a sharp 23,000 to 369,000, while the 4-week average rose slightly to 368,000. Continuing claims  fell 2,000 to 3.254 million. Obviously, the weekly claims have been very volatile, and the seasonal adjustment factors haven’t been smoothing that out very well.

The Chicago Fed National Activity Index rose to 0 from –0.87 last month, indicating an economy that is neither expanding nor contracting, but balanced in a perfect equilibrium. Which is, of course, a practical impossibility.

The Bloomberg Consumer Comfort Index rose to -34.6 from -34.8 the prior week.

The pending home sales index rose a minimal 0.3% in September, following last month’s big –2.6% drop.

Dale Franks
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Michael Barone: Slow-motion 1980?

Michael Barone is one of the few poll watchers I respect. I’ve watched him in any number of elections and he’s objectively called it the way he saw it, usually spot on, for whomever the facts indicated was in the lead. No spin, just good analysis.

Well, in this season of polling chaos, Barone is out with his look at some of the key indicators that help him analyze election trends and he seems to think we are seeing a preference cascade begin ala 1980 … just slower:

My other alternative scenario was based on the 1980 election, when vast numbers of voters switched from Jimmy Carter to Ronald Reagan after their single debate one week before the election. In that debate, the challenger showed he had presidential stature and the incumbent president seemed petulant and small-minded.

We saw an even more vivid contrast between challenger and incumbent in the Oct. 3 debate. In the next two debates, Obama was definitely more focused and aggressive. But Romney held his own, and post-Oct. 16 polling showed him improving his standing even though many debate watchers thought Obama won on points.

What we may be seeing, as we drink from the firehose of multiple poll results pouring in, is a slow-motion 1980.

That reinforces my point about the first debate and something we’ve been saying since Oct. 3. That is the debate that mattered. And note also that in debates 2 and 3, Obama pulled a Carter. His stature was diminished by his actions. He, as Barone and many others have observed, came across as “petulant and small-minded”. Add arrogant and condescending, and you’ve captured it.  Oh, and by the way, his record, like Carter’s, is dismal.

Romney, on the other hand, came across exactly as he had to come across – competent, presidential, confident and, believe it or not, likable. He did what Ronald Reagan did – unfiltered by the media, he was able to convince Americans who tuned in that he was Presidential material. That he was a more than acceptable alternative to Obama.

All of that said, Barone isn’t claiming that this is a done deal by any stretch (“don’t get cocky kid”):

The usual caveats are in order. Exogenous events could affect opinion (Libya seems to have hurt Obama). The Obama ground game is formidable. Voters who switched to Romney could switch back again.

And if there is a larger reservoir of potentially changeable voters than in 2004, there was an even larger reservoir back in 1980, when Carter attracted white Southerners who now are firmly in Romney’s column.

Mechanical analogies can be misleading. Just because Romney has gained ground since Oct. 3 does not guarantee that he will gain more.

But also keep in mind that Romney gained not just from style but from fundamentals. Most voters dislike Obama’s domestic policies and are dissatisfied with the sluggish economy. And now they seem to believe have an alternative with presidential stature.

So, while we apparently have a preference cascade beginning, is it enough?  And will it peak at the right time.  Will it be a slow steady climb to election day?  Will it plateau?  Will it stop short of the majority Romney needs?  Obviously we won’t know that until election night (or, perhaps, the next day).  But suffice it to say, the upward trend is obvious.

How it will play out, however, remains to be seen.