from Reuters: Business News https://ift.tt/2OfA5RS
Wednesday 31 October 2018
EV maker Faraday Future's co-founder Nick Sampson steps down
Chinese electric vehicle developer Faraday Future said on Tuesday its co-founder Nick Sampson has resigned, a week after the cash-starved company planned pay cuts and layoffs to reduce operational costs.
from Reuters: Business News https://ift.tt/2OfA5RS
from Reuters: Business News https://ift.tt/2OfA5RS
Oil prices down more than 1 percent on rising supply, trade war
Oil prices dropped more than 1 percent on Tuesday on signs of rising supply and concern that global economic growth and demand for fuel will fall victim to the U.S.-China trade war.
from Reuters: Business News https://ift.tt/2ABtptS
from Reuters: Business News https://ift.tt/2ABtptS
Wednesday: ADP Employment, Chicago PMI
Wednesday:
• At 7:00 AM ET, The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
• At 8:15 AM, The ADP Employment Report for October. This report is for private payrolls only (no government). The consensus is for 180,000 jobs added, down from 230,000 in September.
• At 9:45 AM, Chicago Purchasing Managers Index for October. The consensus is for a reading of 60.0, down from 60.4 in September.
from Calculated Risk https://ift.tt/2zfSIzR
• At 7:00 AM ET, The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
• At 8:15 AM, The ADP Employment Report for October. This report is for private payrolls only (no government). The consensus is for 180,000 jobs added, down from 230,000 in September.
• At 9:45 AM, Chicago Purchasing Managers Index for October. The consensus is for a reading of 60.0, down from 60.4 in September.
from Calculated Risk https://ift.tt/2zfSIzR
Real House Prices and Price-to-Rent Ratio in August
Here is the earlier post on Case-Shiller: Case-Shiller: National House Price Index increased 5.8% year-over-year in August
It has been over eleven years since the bubble peak. In the Case-Shiller release this morning, the seasonally adjusted National Index (SA), was reported as being 10.4% above the previous bubble peak. However, in real terms, the National index (SA) is still about 8.9% below the bubble peak (and historically there has been an upward slope to real house prices). The composite 20, in real terms, is still 12.4% below the bubble peak.
The year-over-year increase in prices is mostly moving sideways around 6%, although the YoY increase has been slowing recently - and will probably slow more as inventory picks up.
In August, the index was up 5.8% YoY.
Usually people graph nominal house prices, but it is also important to look at prices in real terms (inflation adjusted). Case-Shiller and others report nominal house prices. As an example, if a house price was $200,000 in January 2000, the price would be close to $285,000 today adjusted for inflation (42%). That is why the second graph below is important - this shows "real" prices (adjusted for inflation).
Nominal House Prices
The first graph shows the monthly Case-Shiller National Index SA, and the monthly Case-Shiller Composite 20 SA (through August) in nominal terms as reported.
In nominal terms, the Case-Shiller National index (SA)and the Case-Shiller Composite 20 Index (SA) are both at new all times highs (above the bubble peak).
Real House Prices
The second graph shows the same two indexes in real terms (adjusted for inflation using CPI less Shelter). Note: some people use other inflation measures to adjust for real prices.
In real terms, the National index is back to December 2004 levels, and the Composite 20 index is back to June 2004.
In real terms, house prices are at 2004 levels.
Price-to-Rent
In October 2004, Fed economist John Krainer and researcher Chishen Wei wrote a Fed letter on price to rent ratios: House Prices and Fundamental Value. Kainer and Wei presented a price-to-rent ratio using the OFHEO house price index and the Owners' Equivalent Rent (OER) from the BLS.
Here is a similar graph using the Case-Shiller National and Composite 20 House Price Indexes.
This graph shows the price to rent ratio (January 2000 = 1.0).
On a price-to-rent basis, the Case-Shiller National index is back to February 2004 levels, and the Composite 20 index is back to November 2003 levels.
In real terms, prices are back to mid 2004 levels, and the price-to-rent ratio is back to late 2003, early 2004.
from Calculated Risk https://ift.tt/2Deabx4
It has been over eleven years since the bubble peak. In the Case-Shiller release this morning, the seasonally adjusted National Index (SA), was reported as being 10.4% above the previous bubble peak. However, in real terms, the National index (SA) is still about 8.9% below the bubble peak (and historically there has been an upward slope to real house prices). The composite 20, in real terms, is still 12.4% below the bubble peak.
The year-over-year increase in prices is mostly moving sideways around 6%, although the YoY increase has been slowing recently - and will probably slow more as inventory picks up.
In August, the index was up 5.8% YoY.
Usually people graph nominal house prices, but it is also important to look at prices in real terms (inflation adjusted). Case-Shiller and others report nominal house prices. As an example, if a house price was $200,000 in January 2000, the price would be close to $285,000 today adjusted for inflation (42%). That is why the second graph below is important - this shows "real" prices (adjusted for inflation).
Nominal House Prices
The first graph shows the monthly Case-Shiller National Index SA, and the monthly Case-Shiller Composite 20 SA (through August) in nominal terms as reported.In nominal terms, the Case-Shiller National index (SA)and the Case-Shiller Composite 20 Index (SA) are both at new all times highs (above the bubble peak).
Real House Prices
The second graph shows the same two indexes in real terms (adjusted for inflation using CPI less Shelter). Note: some people use other inflation measures to adjust for real prices.In real terms, the National index is back to December 2004 levels, and the Composite 20 index is back to June 2004.
In real terms, house prices are at 2004 levels.
Price-to-Rent
In October 2004, Fed economist John Krainer and researcher Chishen Wei wrote a Fed letter on price to rent ratios: House Prices and Fundamental Value. Kainer and Wei presented a price-to-rent ratio using the OFHEO house price index and the Owners' Equivalent Rent (OER) from the BLS.
Here is a similar graph using the Case-Shiller National and Composite 20 House Price Indexes.This graph shows the price to rent ratio (January 2000 = 1.0).
On a price-to-rent basis, the Case-Shiller National index is back to February 2004 levels, and the Composite 20 index is back to November 2003 levels.
In real terms, prices are back to mid 2004 levels, and the price-to-rent ratio is back to late 2003, early 2004.
from Calculated Risk https://ift.tt/2Deabx4
California Bay Area Home Sales Decline 20% YoY in September, Inventory up 14% YoY
Here are some Bay Area stats from Pacific Union chief economist Selma Hepp: Bay Area Housing Markets Got Spooked in September
from Calculated Risk https://ift.tt/2AAf01d
• Bay Area home sales declined by 20 percent year over year in September, with all counties posting drops, led by Sonoma and Contra Costa. In 2018, the region’s housing market activity is trending 4 percent lower year to date.
• Bay Area inventory increased by 14 percent year over year in September — about 2,000 more homes — with Santa Clara County contributing more than 50 percent to the total increase.
• While appreciation has slowed from its spring peaks, Bay Area home prices are still up by 10 percent on an annual basis. San Mateo County maintained the strongest price growth at 19 percent.
• The rebalancing between buyers and sellers is driven by affordability constrains and buyer fatigue, with the biggest change seen in relatively affordable and previously fiercely competitive markets.
from Calculated Risk https://ift.tt/2AAf01d
Update: A few comments on the Seasonal Pattern for House Prices
CR Note: This is a repeat of earlier posts with updated graphs.
A few key points:
1) There is a clear seasonal pattern for house prices.
2) The surge in distressed sales during the housing bust distorted the seasonal pattern.
3) Even though distressed sales are down significantly, the seasonal factor is based on several years of data - and the factor is now overstating the seasonal change (second graph below).
4) Still the seasonal index is probably a better indicator of actual price movements than the Not Seasonally Adjusted (NSA) index.
For in depth description of these issues, see former Trulia chief economist Jed Kolko's article "Let’s Improve, Not Ignore, Seasonal Adjustment of Housing Data"
Note: I was one of several people to question the change in the seasonal factor (here is a post in 2009) - and this led to S&P Case-Shiller questioning the seasonal factor too (from April 2010). I still use the seasonal factor (I think it is better than using the NSA data).
Click on graph for larger image.
This graph shows the month-to-month change in the NSA Case-Shiller National index since 1987 (through August 2018). The seasonal pattern was smaller back in the '90s and early '00s, and increased once the bubble burst.
The seasonal swings have declined since the bubble.
The second graph shows the seasonal factors for the Case-Shiller National index since 1987. The factors started to change near the peak of the bubble, and really increased during the bust.
The swings in the seasonal factors has started to decrease, and I expect that over the next several years - as recent history is included in the factors - the seasonal factors will move back towards more normal levels.
However, as Kolko noted, there will be a lag with the seasonal factor since it is based on several years of recent data.
from Calculated Risk https://ift.tt/2qkGySe
A few key points:
1) There is a clear seasonal pattern for house prices.
2) The surge in distressed sales during the housing bust distorted the seasonal pattern.
3) Even though distressed sales are down significantly, the seasonal factor is based on several years of data - and the factor is now overstating the seasonal change (second graph below).
4) Still the seasonal index is probably a better indicator of actual price movements than the Not Seasonally Adjusted (NSA) index.
For in depth description of these issues, see former Trulia chief economist Jed Kolko's article "Let’s Improve, Not Ignore, Seasonal Adjustment of Housing Data"
Note: I was one of several people to question the change in the seasonal factor (here is a post in 2009) - and this led to S&P Case-Shiller questioning the seasonal factor too (from April 2010). I still use the seasonal factor (I think it is better than using the NSA data).
Click on graph for larger image.This graph shows the month-to-month change in the NSA Case-Shiller National index since 1987 (through August 2018). The seasonal pattern was smaller back in the '90s and early '00s, and increased once the bubble burst.
The seasonal swings have declined since the bubble.
The second graph shows the seasonal factors for the Case-Shiller National index since 1987. The factors started to change near the peak of the bubble, and really increased during the bust.The swings in the seasonal factors has started to decrease, and I expect that over the next several years - as recent history is included in the factors - the seasonal factors will move back towards more normal levels.
However, as Kolko noted, there will be a lag with the seasonal factor since it is based on several years of recent data.
from Calculated Risk https://ift.tt/2qkGySe
HVS: Q3 2018 Homeownership and Vacancy Rates
The Census Bureau released the Residential Vacancies and Homeownership report for Q3 2018.
This report is frequently mentioned by analysts and the media to track household formation, the homeownership rate, and the homeowner and rental vacancy rates. However, there are serious questions about the accuracy of this survey.
This survey might show the trend, but I wouldn't rely on the absolute numbers. The Census Bureau is investigating the differences between the HVS, ACS and decennial Census, and analysts probably shouldn't use the HVS to estimate the excess vacant supply or household formation, or rely on the homeownership rate, except as a guide to the trend.
Click on graph for larger image.
The Red dots are the decennial Census homeownership rates for April 1st 1990, 2000 and 2010. The HVS homeownership rate increased to 64.4% in Q3, from 64.3% in Q2.
I'd put more weight on the decennial Census numbers - given changing demographics, the homeownership rate has bottomed.
The HVS homeowner vacancy increased to 1.6% in Q3.
Once again - this probably shows the general trend, but I wouldn't rely on the absolute numbers.
The rental vacancy rate increased to 7.1% in Q3.
The quarterly HVS is the most timely survey on households, but there are many questions about the accuracy of this survey.
Overall this suggests that vacancies have declined significantly, and my guess is the homeownership rate has bottomed - and that the rental vacancy rate has bottomed for this cycle.
from Calculated Risk https://ift.tt/2OVRkgt
This report is frequently mentioned by analysts and the media to track household formation, the homeownership rate, and the homeowner and rental vacancy rates. However, there are serious questions about the accuracy of this survey.
This survey might show the trend, but I wouldn't rely on the absolute numbers. The Census Bureau is investigating the differences between the HVS, ACS and decennial Census, and analysts probably shouldn't use the HVS to estimate the excess vacant supply or household formation, or rely on the homeownership rate, except as a guide to the trend.
Click on graph for larger image.The Red dots are the decennial Census homeownership rates for April 1st 1990, 2000 and 2010. The HVS homeownership rate increased to 64.4% in Q3, from 64.3% in Q2.
I'd put more weight on the decennial Census numbers - given changing demographics, the homeownership rate has bottomed.
The HVS homeowner vacancy increased to 1.6% in Q3.Once again - this probably shows the general trend, but I wouldn't rely on the absolute numbers.
The rental vacancy rate increased to 7.1% in Q3.The quarterly HVS is the most timely survey on households, but there are many questions about the accuracy of this survey.
Overall this suggests that vacancies have declined significantly, and my guess is the homeownership rate has bottomed - and that the rental vacancy rate has bottomed for this cycle.
from Calculated Risk https://ift.tt/2OVRkgt
Case-Shiller: National House Price Index increased 5.8% year-over-year in August
S&P/Case-Shiller released the monthly Home Price Indices for August ("August" is a 3 month average of June, July and August prices).
This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.
Note: Case-Shiller reports Not Seasonally Adjusted (NSA), I use the SA data for the graphs.
From S&P: Annual Gains Fall Below 6% for the First Time in 12 Months According to the S&P CoreLogic Case-Shiller Index
Click on graph for larger image.
The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000).
The Composite 10 index is off 0.8% from the bubble peak, and up 0.1% in August (SA).
The Composite 20 index is 2.4% above the bubble peak, and up 0.1% (SA) in August.
The National index is 10.4% above the bubble peak (SA), and up 0.6% (SA) in August. The National index is up 49.3% from the post-bubble low set in December 2011 (SA).
The second graph shows the Year over year change in all three indices.
The Composite 10 SA is up 5.1% compared to August 2017. The Composite 20 SA is up 5.5% year-over-year.
The National index SA is up 5.8% year-over-year.
Note: According to the data, prices increased in 17 of 20 cities month-over-month seasonally adjusted.
I'll have more later.
from Calculated Risk https://ift.tt/2yBS4x2
This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.
Note: Case-Shiller reports Not Seasonally Adjusted (NSA), I use the SA data for the graphs.
From S&P: Annual Gains Fall Below 6% for the First Time in 12 Months According to the S&P CoreLogic Case-Shiller Index
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 5.8% annual gain in August, down from 6.0% in the previous month. The 10-City Composite annual increase came in at 5.1%, down from 5.5% in the previous month. The 20-City Composite posted a 5.5% year-over-year gain, down from 5.9% in the previous month.
Las Vegas, San Francisco and Seattle reported the highest year-over-year gains among the 20 cities. In August, Las Vegas led the way with a 13.9% year-over-year price increase, followed by San Francisco with a 10.6% increase and Seattle with a 9.6% increase. Four of the 20 cities reported greater price increases in the year ending August 2018 versus the year ending July 2018.
...
Before seasonal adjustment, the National Index posted a month-over-month gain of 0.2% in August. The 10-City and 20-City Composites did not report any gains for the month. After seasonal adjustment, the National Index recorded a 0.6% month-over-month increase in August. The 10-City Composite and the 20-City Composite both posted 0.1% month-over-month increases. In August, 12 of 20 cities reported increases before seasonal adjustment, while 17 of 20 cities reported increases after seasonal adjustment.
“Following reports that home sales are flat to down, price gains are beginning to moderate,” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “Comparing prices to their levels a year earlier, 14 of the 20 cities, the National Index plus the 10-city and 20-city Composite Indices all show slower price growth. The seasonally adjusted monthly data show that 10 cities experienced declining prices. Other housing data tell a similar story: prices and sales of new single family homes are weakening, housing starts are mixed and residential fixed investment is down in the last three quarters. Rising prices may be pricing some potential home buyers out of the market, especially when combined with mortgage rates approaching 5% for 30-year fixed rate loans.
“There are no signs that the current weakness will become a repeat of the crisis, however. In 2006, when home prices peaked and then tumbled, mortgage default rates bottomed out and started a three year surge. Today, the mortgage default rates reported by the S&P/Experian Consumer Credit Default Indices are stable. Without a collapse in housing finance like the one seen 12 years ago, a crash in home prices is unlikely.”
emphasis added
Click on graph for larger image.The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000).
The Composite 10 index is off 0.8% from the bubble peak, and up 0.1% in August (SA).
The Composite 20 index is 2.4% above the bubble peak, and up 0.1% (SA) in August.
The National index is 10.4% above the bubble peak (SA), and up 0.6% (SA) in August. The National index is up 49.3% from the post-bubble low set in December 2011 (SA).
The second graph shows the Year over year change in all three indices.The Composite 10 SA is up 5.1% compared to August 2017. The Composite 20 SA is up 5.5% year-over-year.
The National index SA is up 5.8% year-over-year.
Note: According to the data, prices increased in 17 of 20 cities month-over-month seasonally adjusted.
I'll have more later.
from Calculated Risk https://ift.tt/2yBS4x2
Tuesday: Case-Shiller House Prices, Q3 Housing Vacancies and Homeownership
From Matthew Graham at Mortgage News Daily: Mortgage Rates Stay Near Recent Lows as Busy Week Begins
• At 9:00 AM ET, S&P/Case-Shiller House Price Index for August. The consensus is for a 6.0% year-over-year increase in the Comp 20 index for August.
• At 10:00 AM, the Q3 2018 Housing Vacancies and Homeownership from the Census Bureau.
from Calculated Risk https://ift.tt/2qjE9aw
Mortgage rates didn't move today, despite a fair amount of underlying market volatility. … Holding steady today means that rates remain at their lowest levels in just over 2 weeks. That sounds like a good thing, but the catch is that we really haven't moved too far from recent highs during that time, and those are the highest highs in more than 7 years. [30YR FIXED - 4.875-5.0%]Tuesday:
emphasis added
• At 9:00 AM ET, S&P/Case-Shiller House Price Index for August. The consensus is for a 6.0% year-over-year increase in the Comp 20 index for August.
• At 10:00 AM, the Q3 2018 Housing Vacancies and Homeownership from the Census Bureau.
from Calculated Risk https://ift.tt/2qjE9aw
Year-over-year Change in Real Personal Consumption Expenditures (PCE)
Earlier I posted a graph showing real monthly personal consumption expenditures (PCE) based on the monthly BEA report.
Here is a graph showing the year-over-year change in real PCE since 2003.
In September, the YoY change was 3.0%, about the same level as for the last few years.
Click on graph for larger image.
There was a significant decline in real PCE during the great recession, and real PCE was fairly weak during the first few years of the recovery - partially due to the ongoing weakness in housing following the housing bubble and bust.
More recently real PCE has been increasing at a fairly steady rate around 3.0% per year.
from Calculated Risk https://ift.tt/2zbLJaZ
Here is a graph showing the year-over-year change in real PCE since 2003.
In September, the YoY change was 3.0%, about the same level as for the last few years.
Click on graph for larger image.There was a significant decline in real PCE during the great recession, and real PCE was fairly weak during the first few years of the recovery - partially due to the ongoing weakness in housing following the housing bubble and bust.
More recently real PCE has been increasing at a fairly steady rate around 3.0% per year.
from Calculated Risk https://ift.tt/2zbLJaZ
Q3 2018 GDP Details on Residential and Commercial Real Estate
The BEA has released the underlying details for the Q3 advance GDP report.
The BEA reported that investment in non-residential structures decreased at a 7.9% annual pace in Q3. Investment in petroleum and natural gas exploration decreased slightly in Q3 compared to Q2, but has increased substantially recently.
Without the increase in petroleum and natural gas exploration, non-residential investment would only be up about 4% year-over-year.
Click on graph for larger image.
The first graph shows investment in offices, malls and lodging as a percent of GDP.
Investment in offices increased in Q3, and is up 10% year-over-year.
Investment in multimerchandise shopping structures (malls) peaked in 2007 and was down about 7% year-over-year in Q3. The vacancy rate for malls is still very high, so investment will probably stay low for some time.
Lodging investment increased in Q3, and lodging investment is up 7% year-over-year.
The second graph is for Residential investment components as a percent of GDP. According to the Bureau of Economic Analysis, RI includes new single family structures, multifamily structures, home improvement, Brokers’ commissions and other ownership transfer costs, and a few minor categories (dormitories, manufactured homes).
Home improvement was the top category for five consecutive years following the housing bust ... but now investment in single family structures has been back on top for the last six years and will probably stay there for a long time - although single family investment has been down a little recently.
However - even though investment in single family structures has increased from the bottom - single family investment is still very low, and still below the bottom for previous recessions as a percent of GDP. I expect some further increase.
Investment in single family structures was $286 billion (SAAR) (about 1.4% of GDP), and was down slightly in Q3 compared to Q2.
Investment in multi-family structures decreased in Q3.
Investment in home improvement was at a $264 billion Seasonally Adjusted Annual Rate (SAAR) in Q3 (about 1.3% of GDP). Home improvement spending has been solid.
from Calculated Risk https://ift.tt/2Q3Ep8R
The BEA reported that investment in non-residential structures decreased at a 7.9% annual pace in Q3. Investment in petroleum and natural gas exploration decreased slightly in Q3 compared to Q2, but has increased substantially recently.
Without the increase in petroleum and natural gas exploration, non-residential investment would only be up about 4% year-over-year.
Click on graph for larger image.The first graph shows investment in offices, malls and lodging as a percent of GDP.
Investment in offices increased in Q3, and is up 10% year-over-year.
Investment in multimerchandise shopping structures (malls) peaked in 2007 and was down about 7% year-over-year in Q3. The vacancy rate for malls is still very high, so investment will probably stay low for some time.
Lodging investment increased in Q3, and lodging investment is up 7% year-over-year.
The second graph is for Residential investment components as a percent of GDP. According to the Bureau of Economic Analysis, RI includes new single family structures, multifamily structures, home improvement, Brokers’ commissions and other ownership transfer costs, and a few minor categories (dormitories, manufactured homes).Home improvement was the top category for five consecutive years following the housing bust ... but now investment in single family structures has been back on top for the last six years and will probably stay there for a long time - although single family investment has been down a little recently.
However - even though investment in single family structures has increased from the bottom - single family investment is still very low, and still below the bottom for previous recessions as a percent of GDP. I expect some further increase.
Investment in single family structures was $286 billion (SAAR) (about 1.4% of GDP), and was down slightly in Q3 compared to Q2.
Investment in multi-family structures decreased in Q3.
Investment in home improvement was at a $264 billion Seasonally Adjusted Annual Rate (SAAR) in Q3 (about 1.3% of GDP). Home improvement spending has been solid.
from Calculated Risk https://ift.tt/2Q3Ep8R
Dallas Fed: "Texas Manufacturing Continues to Expand, but Pace Slows"
From the Dallas Fed: Texas Manufacturing Continues to Expand, but Pace Slows
Here is a graph comparing the regional Fed surveys and the ISM manufacturing index:
Click on graph for larger image.
The New York and Philly Fed surveys are averaged together (yellow, through October), and five Fed surveys are averaged (blue, through October) including New York, Philly, Richmond, Dallas and Kansas City. The Institute for Supply Management (ISM) PMI (red) is through September (right axis).
Based on these regional surveys, it seems likely the ISM manufacturing index will be solid in October, but below 60 again (to be released on Thursday, November 1st).
from Calculated Risk https://ift.tt/2OdaLMs
Texas factory activity continued to expand in October, albeit at a slower pace, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, was positive but declined another six points to 17.6, indicating output growth continued to abate.This was the last of the regional Fed surveys for October.
Some other indexes of manufacturing activity also suggested slower expansion in October. The capacity utilization index retreated six points to 15.4, while the shipments index fell four points to 16.6. Meanwhile, the new orders index rose—pushing up four points to 18.9—and the growth rate of orders index held steady at 11.0.
Perceptions of broader business conditions improved this month. The general business activity index inched up to 29.4, and the company outlook index climbed seven points to 25.0. Fewer than 3 percent of firms noted that their outlook worsened, the lowest share since 2004. The index measuring uncertainty regarding companies’ outlooks retreated 13 points to 6.9.
Labor market measures suggested rising employment levels and longer workweeks in October. The employment index rose six points to 23.9, a level well above average. Twenty-eight percent of firms noted net hiring, compared with 4 percent noting net layoffs. The hours worked index remained positive but moved down to 6.5.
Price increases accelerated further in October, and wage pressures remained elevated.
emphasis added
Here is a graph comparing the regional Fed surveys and the ISM manufacturing index:
Click on graph for larger image.The New York and Philly Fed surveys are averaged together (yellow, through October), and five Fed surveys are averaged (blue, through October) including New York, Philly, Richmond, Dallas and Kansas City. The Institute for Supply Management (ISM) PMI (red) is through September (right axis).
Based on these regional surveys, it seems likely the ISM manufacturing index will be solid in October, but below 60 again (to be released on Thursday, November 1st).
from Calculated Risk https://ift.tt/2OdaLMs
Personal Income increased 0.2% in September, Spending increased 0.4%
The BEA released the Personal Income and Outlays report for September:
The following graph shows real Personal Consumption Expenditures (PCE) through September 2018 (2012 dollars). Note that the y-axis doesn't start at zero to better show the change.
Click on graph for larger image.
The dashed red lines are the quarterly levels for real PCE.
The increase in personal income was below expectations, and the increase in PCE was at expectations.
PCE growth was strong in Q3, and inflation is close to the Fed's target.
from Calculated Risk https://ift.tt/2Db4NdZ
Personal income increased $35.7 billion (0.2 percent) in September according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $29.1 billion (0.2 percent) and personal consumption expenditures (PCE) increased $53.0 billion (0.4 percent).The September PCE price index increased 2.0 percent year-over-year and the September PCE price index, excluding food and energy, also increased 2.0 percent year-over-year.
Real DPI increased 0.1 percent in September and Real PCE increased 0.3 percent. The PCE price index increased 0.1 percent. Excluding food and energy, the PCE price index increased 0.2 percent.
The following graph shows real Personal Consumption Expenditures (PCE) through September 2018 (2012 dollars). Note that the y-axis doesn't start at zero to better show the change.
Click on graph for larger image.The dashed red lines are the quarterly levels for real PCE.
The increase in personal income was below expectations, and the increase in PCE was at expectations.
PCE growth was strong in Q3, and inflation is close to the Fed's target.
from Calculated Risk https://ift.tt/2Db4NdZ
Monday: Personal Income and Outlays, Dallas Fed Mfg
Weekend:
• Schedule for Week of October 28, 2018
Monday:
• At 8:30 AM ET, Personal Income and Outlays for September. The consensus is for a 0.4% increase in personal income, and for a 0.4% increase in personal spending. And for the Core PCE price index to increase 0.1%.
• At 10:30 AM, Dallas Fed Survey of Manufacturing Activity for October. This is the last of the regional Fed manufacturing surveys for October.
From CNBC: Pre-Market Data and Bloomberg futures: S&P 500 are up 18 and DOW futures are up 144 (fair value).
Oil prices were down over the last week with WTI futures at $67.69 per barrel and Brent at $77.79 per barrel. A year ago, WTI was at $54, and Brent was at $61 - so oil prices are up about 25% year-over-year.
Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $2.81 per gallon. A year ago prices were at $2.45 per gallon, so gasoline prices are up 36 cents per gallon year-over-year.
from Calculated Risk https://ift.tt/2yD001b
• Schedule for Week of October 28, 2018
Monday:
• At 8:30 AM ET, Personal Income and Outlays for September. The consensus is for a 0.4% increase in personal income, and for a 0.4% increase in personal spending. And for the Core PCE price index to increase 0.1%.
• At 10:30 AM, Dallas Fed Survey of Manufacturing Activity for October. This is the last of the regional Fed manufacturing surveys for October.
From CNBC: Pre-Market Data and Bloomberg futures: S&P 500 are up 18 and DOW futures are up 144 (fair value).
Oil prices were down over the last week with WTI futures at $67.69 per barrel and Brent at $77.79 per barrel. A year ago, WTI was at $54, and Brent was at $61 - so oil prices are up about 25% year-over-year.
Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $2.81 per gallon. A year ago prices were at $2.45 per gallon, so gasoline prices are up 36 cents per gallon year-over-year.
from Calculated Risk https://ift.tt/2yD001b
Hotels: Occupancy Rate Increased Slightly Year-over-year
From HotelNewsNow.com: US hotel results for week ending 20 October
Click on graph for larger image.
The red line is for 2018, dash light blue is 2017, blue is the median, and black is for 2009 (the worst year probably since the Great Depression for hotels).
This is the fourth strong year in a row for hotel occupancy. The occupancy rate, to date, is just ahead of the record year in 2017.
Seasonally, the occupancy rate will now decline through the end of the year.
Data Source: STR, Courtesy of HotelNewsNow.com
from Calculated Risk https://ift.tt/2Spjv5B
The U.S. hotel industry reported positive year-over-year results in the three key performance metrics during the week of 14-20 October 2018, according to data from STR.The following graph shows the seasonal pattern for the hotel occupancy rate using the four week average.
In comparison with the week of 15-21 October 2017, the industry recorded the following:
• Occupancy: +0.4% to 73.2%
• Average daily rate (ADR): +3.2% to US$135.67
• Revenue per available room (RevPAR): +3.6% to US$99.32
…
Houston, Texas, registered the steepest declines in each of the three key performance metrics: occupancy (-23.8% to 66.0%), ADR (-8.8% to US$107.41) and RevPAR (-30.6% to US$70.85). Houston’s hotel performance was lifted in the weeks and months that followed Hurricane Harvey in 2017 as properties filled with displaced residents, relief workers, insurance adjustors, media members, etc.
emphasis added
Click on graph for larger image.The red line is for 2018, dash light blue is 2017, blue is the median, and black is for 2009 (the worst year probably since the Great Depression for hotels).
This is the fourth strong year in a row for hotel occupancy. The occupancy rate, to date, is just ahead of the record year in 2017.
Seasonally, the occupancy rate will now decline through the end of the year.
Data Source: STR, Courtesy of HotelNewsNow.com
from Calculated Risk https://ift.tt/2Spjv5B
Schedule for Week of October 28, 2018
The key report this week is the October employment report on Friday.
Other key indicators include the October ISM manufacturing index, October auto sales, Personal Income and Outlays for September, Case-Shiller house prices for August, and the September trade deficit.
For manufacturing, the Dallas Fed manufacturing survey will be released this week.
----- Monday, Oct 29th -----
8:30 AM ET: Personal Income and Outlays for September. The consensus is for a 0.4% increase in personal income, and for a 0.4% increase in personal spending. And for the Core PCE price index to increase 0.1%.
10:30 AM: Dallas Fed Survey of Manufacturing Activity for October. This is the last of the regional Fed manufacturing surveys for October.
----- Tuesday, Oct 30th -----
9:00 AM ET: S&P/Case-Shiller House Price Index for August.
This graph shows the nominal seasonally adjusted National Index, Composite 10 and Composite 20 indexes through the most recent report (the Composite 20 was started in January 2000).
The consensus is for a 6.0% year-over-year increase in the Comp 20 index for August.
10:00 AM: the Q3 2018 Housing Vacancies and Homeownership from the Census Bureau.
----- Wednesday, Oct 31st -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
8:15 AM: The ADP Employment Report for October. This report is for private payrolls only (no government). The consensus is for 180,000 jobs added, down from 230,000 in September.
9:45 AM: Chicago Purchasing Managers Index for October. The consensus is for a reading of 60.0, down from 60.4 in September.
----- Thursday, Nov 1st -----
All day: Light vehicle sales for October.
The consensus is for 17.0 million SAAR in October, down from the BEA estimate of 17.36 million SAAR in September 2018 (Seasonally Adjusted Annual Rate).
This graph shows light vehicle sales since the BEA started keeping data in 1967. The dashed line is the current sales rate.
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for 212 thousand initial claims, down from 215 thousand the previous week.
10:00 AM: ISM Manufacturing Index for October. The consensus is for 59.1%, down from 59.8%.
Here is a long term graph of the ISM manufacturing index.
The PMI was at 59.8% in September, the employment index was at 58.8%, and the new orders index was at 61.8%.
10:00 AM: Construction Spending for September. The consensus is for 0.3% increase in spending.
----- Friday, Nov 2nd -----
8:30 AM: Employment Report for October. The consensus is for 190,000 jobs added, and for the unemployment rate to be unchanged at 3.7%.
There were 134,000 jobs added in September, and the unemployment rate was at 3.7%.
This graph shows the year-over-year change in total non-farm employment since 1968.
In September the year-over-year change was 2.537 million jobs.
A key will be the change in wages.
8:30 AM: Trade Balance report for September from the Census Bureau.
This graph shows the U.S. trade deficit, with and without petroleum, through the most recent report. The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.
The consensus is the trade deficit to be $53.4 billion. The U.S. trade deficit was at $53.2 billion in August.
from Calculated Risk https://ift.tt/2Jkl14H
Other key indicators include the October ISM manufacturing index, October auto sales, Personal Income and Outlays for September, Case-Shiller house prices for August, and the September trade deficit.
For manufacturing, the Dallas Fed manufacturing survey will be released this week.
8:30 AM ET: Personal Income and Outlays for September. The consensus is for a 0.4% increase in personal income, and for a 0.4% increase in personal spending. And for the Core PCE price index to increase 0.1%.
10:30 AM: Dallas Fed Survey of Manufacturing Activity for October. This is the last of the regional Fed manufacturing surveys for October.
9:00 AM ET: S&P/Case-Shiller House Price Index for August.This graph shows the nominal seasonally adjusted National Index, Composite 10 and Composite 20 indexes through the most recent report (the Composite 20 was started in January 2000).
The consensus is for a 6.0% year-over-year increase in the Comp 20 index for August.
10:00 AM: the Q3 2018 Housing Vacancies and Homeownership from the Census Bureau.
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
8:15 AM: The ADP Employment Report for October. This report is for private payrolls only (no government). The consensus is for 180,000 jobs added, down from 230,000 in September.
9:45 AM: Chicago Purchasing Managers Index for October. The consensus is for a reading of 60.0, down from 60.4 in September.
All day: Light vehicle sales for October.The consensus is for 17.0 million SAAR in October, down from the BEA estimate of 17.36 million SAAR in September 2018 (Seasonally Adjusted Annual Rate).
This graph shows light vehicle sales since the BEA started keeping data in 1967. The dashed line is the current sales rate.
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for 212 thousand initial claims, down from 215 thousand the previous week.
10:00 AM: ISM Manufacturing Index for October. The consensus is for 59.1%, down from 59.8%.Here is a long term graph of the ISM manufacturing index.
The PMI was at 59.8% in September, the employment index was at 58.8%, and the new orders index was at 61.8%.
10:00 AM: Construction Spending for September. The consensus is for 0.3% increase in spending.
8:30 AM: Employment Report for October. The consensus is for 190,000 jobs added, and for the unemployment rate to be unchanged at 3.7%.There were 134,000 jobs added in September, and the unemployment rate was at 3.7%.
This graph shows the year-over-year change in total non-farm employment since 1968.
In September the year-over-year change was 2.537 million jobs.
A key will be the change in wages.
8:30 AM: Trade Balance report for September from the Census Bureau.This graph shows the U.S. trade deficit, with and without petroleum, through the most recent report. The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.
The consensus is the trade deficit to be $53.4 billion. The U.S. trade deficit was at $53.2 billion in August.
from Calculated Risk https://ift.tt/2Jkl14H
U.S. 'Preferred' Stock Market; Asia Looks 'Attractive.' StanChart's Brice Says
from Bloomberg https://ift.tt/2PBJfNG
Disgusting Food Museum Question Visitors' Ideas of What's Tasty
from Bloomberg https://ift.tt/2EUzBS6
Disgusting Food Museum Questions Visitors' Ideas of What's Tasty
from Bloomberg https://ift.tt/2Sr5693
1000s of Polling Places Closed over Past Decade
One week from today the mid-term elections take place. In many areas, especially those controlled by GOP Governors/State legislators, it is increasingly difficult to vote. An extraordinary scandal: Source: Washington Post
The post 1000s of Polling Places Closed over Past Decade appeared first on The Big Picture.
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