Free Markets, Free People

Economic statistics

Economic Statistics for 21 Aug 13…and Commentary

Here are today’s statistics on the state of the economy:

 

The MBA reports that Mortgage applications fell -4.6% last week, as re-fis fell -8.0%. Purchases rose 1.0%, though. Rising interest rates are what is killing the re-fi market.

Speaking of rising rates, the NAR says panic over them drove existing home sales up 6.5% to a 5.390 million annual rate in July. House prices are steady, but rising rates are forcing buyers to purchase before the interest payments get too high.

One might, if one was inclined, parenthetically remark that rising mortgage rates may signal the inevitability of rising interest rates for Treasury bonds. Or, perhaps, vice versa. Whatever.

Either way, you should keep in mind that a rise of 1% in Treasury yields works out to an additional $160 billion or so in debt service payments per year. Right now we’re paying about $350 billion a year on debt service, with a low net interest rate a bit above 2%.

If the net interest rate goes back to the historical rate of 6%, we’re looking at interest payments of $950 billion or so per year. Keep in mind that the Federal government already isn’t taking in enough revenue to cover payments for Social Security, Medicare, and Debt Service. That means that we’re borrowing money to cover part of our debt service, and everything else the federal government does. There’s no way we can afford to pay $950 billion a year in interest payments.

And we certainly can’t borrow an additional $600 billion per year to pay for the additional interest payments. That would quickly result in a debt death spiral. But we could eliminate every single executive department–including Defense– and we’d still have a $1 trillion deficit.

You should be happy the economy is moribund, because that’s keeping interest rates low, and low interest rates are preventing the aforementioned fiscal death spiral right now.

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Dale Franks
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Economic Statistics for 15 Aug 13

The following US economic statistics were announced in today’s heavy round of releases:

The CPI rose 0.2% in July, at both the headline and core levels. On a year over year basis, consumer prices are up 2.0% overall and 1.7% at the core.

Initial jobless claims fell 15,000 to a recovery low 320,000 last week. The 4-week average fell 4,000 to 332,000. Continuing claims fell 38,000 to 2.987 million. All signs are pointing to a good employment picture for August.

The Empire State manufacturing index in August fell nearly a point to 8.24.

Net purchases of long-term US securities in August were $-66.9 billion vice a revised $-27.0 billion in July, as foreign investors sold &77.8 billion in US securities.

The Fed reports that Industrial Production was unchanged in July, while capacity utilization in the nation’s factories fell 0.2% to 77.6%. Manufacturing fell -0.1%.

The Bloomberg Consumer Comfort Index fell 3 points to -26.6 in the latest week.

The NAHB Housing Market Index continues to rise, up another 2 points to 59 for August, a seven-year high.

The Philadelphia Fed’s Business Outlook fell 10 points to 9.3 in August.

E-Commerce sales rose 4.9% in the 2nd Quarter of 2013. Year-over-year sales are up a very strong 18.4%.

The fed reports that M2 money supply grew by $21.9 billion last week.

The Fed’s balance sheet rose by $61.0 billion last week, bringing total Fed assets to $3.646 trillion.

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Dale Franks
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Economic Statistics for 14 Aug 13

Here are today’s statistics on the state of the economy:

The Atlanta Fed Business Inflation Expectations report for August indicates that businesses expect 2.0% inflation for the year ahead, up from 1.8% last month.

July producer prices were unchanged overall, with the core rate up only 0.1%. On a year over year basis, the PPI is up 2.1%, and 1.2% for the core rate.

The MBA reports that mortgage apps continue to decline, down -4.7% last week, with purchases at -5.0% and re-fis at -4.0%.

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Dale Franks
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Economic Statistics for 13 Aug 13

The following US economic statistics were announced today:

The NFIB Small Business Optimism Index rose 0.6 points to 94.1 in July.

ICSC-Goldman Store Sales were down -0.2% last week, and up 2.6% from last Year, Redbook’s reading shows a 3.7% year-over-year increase.

Retail sales for July rose 0.2% overall, and were up 0.5% ex-autos, and 0.4% ex-autos and -gas.

US export prices fell -0.1% in July, while import prices rose 0.2%. On a year-over-year basis, export prices are up 0.4%, while import prices are up 1.0%.

Business inventories were unchanged for June, as was the stock-to-sales ratio, at 1.29.

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Dale Franks
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Economic Statistics for 8 Aug 13

The following US economic statistics were announced today:

The Bloomberg Consumer Comfort Index rose 3.5 points to -23.5, the highest in 5 years.

Chain store sales were mostly positive for July, though most of the increases come from new stores, with same store sales a bit weak.

Initial claims for unemployment rose 7,000 last week, to 333,000. The 4-week moving average fell 5,750 to 335,500, Continuing claims rose 59,000 to 3.018 million.

The Fed’s balance sheet rose $13.6 billion last week, with total assets of $3.585 trillion. Reserve Bank credit increased $10.3 billion.

The Fed reports that M2 Money Supply increased by $46.4 billion last week.

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Dale Franks
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Economic Statistics for 6 Aug 13

Here are today’s statistics on the state of the economy:

America’s trade deficit narrowed to $-34.2 billion in June. Exports rose, and imports fell, though the falling imports may signal a lack of domestic consumer demand.

The Gallup Economic Confidence Index (ECI) fell from -98 to -12 in July.

Redbook is reporting solid retail sales growth at 3.7% from a year ago. ICSC-Goldman reports retail sales rose 0.3% last week, and are up 2.5% from a year ago.

~
Dale Franks
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