Free Markets, Free People

Economy


Economic Statistics for 20 Mar 14

Initial jobless claims rose 5,000 to 320,000. The 4-week average fell 3,500 to 327,000. Continuing claims rose 41,000 to 2.889 million.

The Bloomberg Consumer Comfort Index fell -1.4 points to -29.0 in the latest week.

The general business conditions index of the Philadelphia Fed’s Business Outlook Survey rose from -6.3 to 9.0 in March.

Existing home sales fell -0.4% in February to a 4.6 million annual rate. On a year-over-year basis, sales are down -7.1%.

The Conference Board’s index of leading indicators rose a solid 0.5% in February.

The Fed’s balance sheet rose $40.7 billion last week, with total assets of $4.222 trillion. Reserve Bank credit increased $39.1 billion.

The Fed reports that M2 money supply rose by $23.7 billion in the latest week.


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Economic Statistics for 19 Mar 14

The MBA reports that mortgage applications fell -1.2% last week, with purchases and re-fis both down -1.0%.

Strong exports narrowed the nation’s current account deficit to $81.1 billion in the 4th quarter of 2013, down from a revised $96.4 billion in the 3rd quarter.

The Federal Open markets Committee announced that interest rate policy will remain unchanged, with the Federal Funds Rate target at 0% to 0.25%. The FOMC released their projections for US GDP Growth: 2014: 2.8 to 3.0 %; 2015: 3.0 to 3.2 %; 2016: 2.5 to 3.0 %; longer run: 2.2 to 2.2 %.


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Economic Statistics for 18 Mar 14

In weekly retail sales, Redbook reports a soft 2.8% increase from the previous year. ICSC-Goldman reports a weekly sales increase of 0.7%, and a 1.5% increase on a year-over-year basis.

Consumer Prices rose 0.1% in February at both the headline and core level. On a year-over-year basis, consumer prices are up 1.1% overall and 1.6% less food and energy.

February housing starts dropped 0.2% to a 0.907 million annual rate, but building permits rose 7.7% to a 1.018 million annual rate.

The Treasury Department reports that net inflow of long-term securities totaled $7.3 billion in January vice a revised $-49.5 billion in December.


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Economic Statistics for 17 Mar 14

The National Association of Home Builders’ Housing Market Index rose 1 point to a lower-than-expected 47 in March.

The New York Fed’s Empire State Manufacturing Survey rose to to 5.61 in March from 4.48 in February.

The Fed reports that Industrial Production rose an unexpectedly strong 0.6% in March. Capacity Utilization in the nation’s factories rose 0.3% to 78.8%.


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Economic Statistics for 13 Mar 14

The Bloomberg Consumer Comfort Index rose 0.9 points to -27.6 in the latest week, the highest since last August.

Initial jobless claims fell 9,000 to 315,000. The 4-week average fell 6,000 to 330,500. Continuing claims fell 48,000 to 2.855 million.

The Fed’s balance sheet rose $9.6 billion last week, with total assets of $4.181 trillion. Reserve Bank credit increased $11.2 billion.

The Fed reports that M2 money supply fell by $-13.9 billion in the latest week.

February retail sales rose 0.3% in February across the board, overall, less gas, and less gas and autos.

February export prices rose 0.6%, while import prices rose 0.9%. On a year-over-year basis, export prices fell 01.3%, while import prices fell -1.1%.

Business Inventories rose 0.4% in January, while a steep -0.6% drop in sales pushed the stock-to-sales ratio up to a troubling 1.32.


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More business busting regulatory abuse by the imperial President

Market?  What market?  We haven’t had a free market for much of anything in at least the last 75 years:

Business groups and congressional Republicans are blasting regulations President Obama will announce Thursday that could extend overtime pay to as many as 10 million workers who are now ineligible for it.

While liberals lauded the plan as putting more cash in the pockets of millions of workers, business groups warned it would damage the economy and Republicans said it was another example of executive overreach.

That’s right friends, now it appears that the Obama administration has decided … that’s right, “decided” … that in addition to the increase in the minimum wage, now it needs to redefine who is eligible for overtime. And, of course, that redefinition is going to negatively impact who?  Businesses.  And if they have to live with the changes, who then will it effect?

Oh, yeah, those that can least afford it.  Why?  Because it will increase the cost of doing business.  And what do businesses do when their costs increase?  Pass it on to the consumer.

Now, I ask, was that so hard to spell out?  No.  And is it hard to understand?  Again, no.

So why is it liberals can’t follow the logic train to its final destination?

Well that’s fairly simple, they don’t think, they emote.  The bureaucrats, who’ve never had to run a business or turn a profit in order to meet a payroll are experts in what others “need”.  And they’re convinced those who are involved in running a business are just greedy.

“What we’re trying to take a look at is how we can make the labor force as fair as possible for all workers and that people get rewarded for a hard day’s work with a fair wage,” Betsey Stevenson, a member of the White House Council of Economic Advisers, told reporters Wednesday.

Right.  Because, you know, the guy who risked everything and has succeeded to the point that he can hire others and thereby give the abysmal unemployment numbers some relief aren’t “fair” – by definition I guess.

“Changing the rules for overtime eligibility will, just like increasing the minimum wage, make employees more expensive and will force employers to look for ways to cover these increased costs,” said Marc Freedman, executive director of labor law policy at the U.S. Chamber of Commerce.

Meanwhile in fantasyland:

Stevenson, however, contended that there would likely be an increase in employment as a result of the change, with companies deciding to hire more employees rather than paying existing workers at a higher rate.

Really?  Or perhaps they’ll hire less and use technology to fill the bill.  Technological answers don’t ask for raises, don’t require health care coverage, don’t need overtime, etc.  In fact, it is likely to lead to less employment and more mechanization.

But we should understand the BIG reason:

Proponents say the regulations are an issue of fairness.

“I think that if you put in a full week’s work and you end up being asked by your employer to work longer hours, you deserve to be paid a little extra,” said Rep. Xavier Becerra (D-Calif.).

Is that right?  Well, frankly, Rep. Becerra, that’s none of your freakin’ business.  But, I assume you can point out the Constitutional basis for your “thought”, right?

Bunch of idiots.  They are bound and determined to destroy the golden goose because they’re are woefully ignorant of the goose’s anatomy and how it works.

~McQ


Economic Statistics for 11 Mar 13

Wholesale inventories rose 0.6% in January, while sales plunged -1.9%. That drove the sector’s stock-to-sales ratio up to a hefty 1.20.

The NFIB Small Business Optimism Index fell 3 points to 91.4 in February.

In weekly retail sales, ICSC Goldman reports a 1.3% weekly sales increase, and a 2.1% year-on-year increase. Meanwhile, Redbook says sales rose a weak 2.5% on a year-ago basis.


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President’s FY2015 budget more proof that he lives in a fantasy world

If I’m not mistaken, not a single Obama budget (those few he’s submitted) over the years has gotten even one vote when it hit Congress.  And that includes votes from Democrats.

This year is likely to be no exception.

Veronique De Rugy at George Mason Univerity’s Mercatus Center says:

Much of the president’s proposed budget’s rosy projections will require considerable tax financing and political restraint to come to fruition. If revenues are lower than anticipated or spending is not restricted as planned, the ten-year debt picture will look quite different. I have noted before that President Obama’s later mid-session review budget differed considerably from his early budget projections. Early revenue and outlay projections were higher than actual amounts, while deficit spending surged much higher than anticipated from 2010 to 2012. This budget will likely mis-project critical variables as well. The rosiest projections all too often turn out to be the most disappointing.

Talk about an understatement.  And the rosy projection?  Well here it is compared to the CBO projection:

You have to chuckle at a miss that bad. In the outlying years, look at the percent of GDP the CBO projects vs. Obama.  Any guess as to which projection is most likely of the two?

Go back to a key line ins De Rugy’s analysis:

If revenues are lower than anticipated or spending is not restricted as planned, the ten-year debt picture will look quite different.

Point to a moment in recent history where our profligate politicians have actually followed a restrictive spending plan that would have the effect Obama says it will?

Yeah, I can’t point to it either.

Regardless, however, we’re supposed to believe that if the plan is followed as layed out in the Obama budget, we’ll see long term debt reduction.

Unfortunatly the next chart doesn’t at all support that claim:

In every year projected, spendin is greater than revenue.  So what they’re assuming is massive growth in the eoncomy to make the debt they pile up in the later years a smaller percentage of the GDP.

Really?  Taxes are going to go up, government spending will also go up and yet somehow the private economy is going to surge (10 more “recovery summers”, eh?)?  Obama plans spending and taxation as a percentage of GDP that are at or near historic highs, but we’ll see huge economic growth to support that?

Wow, if you’re not flying the red BS flag, you need to take an Econ 101 class.

Yet this is what the President of the United States is presenting as a functional budget for this country 10 years into the future.

Fantasyland.

~McQ