Succinct summation of week’s events:

Positives:

1) Gasoline prices fall another .04 on the week to $3.61, according to AAA, the cheapest since Feb.
2) The Fed’s now preferred inflation figure, the PCE price deflator (instead of CPI), rises 1.8% in April, the lowest since Feb ’11.
3) A bright spot within payrolls was the 422k job gain in the Household Employment survey.
4) Ireland votes to hold hands (I’m sure with their eyes closed) with the rest of Europe by passing the fiscal treaty.
5) Another drop in interest rates in the US, UK, Germany and in some others, never a better time to borrow money if you can get it.

Negatives:

1) May Payrolls grow only 69k after just 77k in April, well below expectations of 150k. Likely again some weather give back but US economy clearly slowing.
2) ISM mfr’g at 53.5, slightly below expectations of 53.8 but not as bad as feared and ISM puts positive spin on mfr’g.
3) Initial Jobless Claims total 383k, 13k above estimates and follows 4 weeks around 370k.
4) April Pending Home Sales fall 5.5% vs the est of flat and comes after cumulative 16.3% in unusual Oct thru Mar fall/winter.
5) Refi and purchase apps fall even with another new drop in mortgage rates.
6) Conference Bd Consumer Confidence falls to 4 month low.
7) Number of German unemployed remains flat vs est of down 7k.
8) Spanish and Italian yields again higher, IBEX closes at fresh 9 yr low and MIB just 100+ pts from Mar ’09 low.
9) Euro zone unemployment at 11% in April, unchanged with Mar.
10) China mfr’g PMI falls to 50.4 from 53.3 and PMI’s in India, South Korea and Taiwan fall slightly.
11) India’s Q1 GDP grows only 5.3%, the slowest in 10 yrs.
12) Fallout from China’s slowdown, Hong Kong’s April retail sales rise less than expected.
13) Historically low rates in the US, Germany, UK, etc… are scary to watch especially a negative 2 yr note yield in Germany.

Category: Markets

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

8 Responses to “Succinct Summation of Week’s Events (6.1.12)”

  1. Futuredome says:

    Asset prices were overvalued with delevering still ongoing. It won’t be to deleveraging ends that the recovery blows off and the economy fully recovers. This is true of 90′s and 00′s recessions.

    The Dow will probably bottom around 11,000, Oil at 68.

  2. James Cameron says:

    That’s a pretty long list of negatives, to say nothing of what’s in it . . .

  3. Boock,

    what about the ‘pulled’ Graff IPO?

    not to say that it ‘shouldn’t’ have been..

    but.. (??)

  4. Robespierre says:

    “5) Another drop in interest rates in the US, UK, Germany and in some others, never a better time to borrow money if you can get it.”

    Honestly that is not a positive but a sign of something really negative that is in progress.

  5. JFC!?!?!

    Succinct is: “global contagion”.

    Either they are going to “print” bailouts, or they are going to print the effing “bailouts” too effing late and the government(s) won’t be able to stop runs like we’ve never seen before.

  6. This week certainly sucked, 38k downgrade of April jobs & paring in March reverses BLS trend of subsequent upgrades.

    Adding in this week’s forward-looking data, TRI gauges Q2 GDP to have an upper bound of 3.3%. Eleven days prior to the Election, BEA should be announcing Q3 GDP as high as 2.9%. Four days prior, BLS are likely to announce an 8.0% Unemployment Rate.

    Longer term, this postpones my projection for the first FOMC rate increase to Dec/2014 (mirroring their “late 2014″ target) upon UR finally retreating below 7.0%. The 5-yr mortgage rate should be up 2% by late 2016.

    TRI charts: http://trendlines.ca/free/economics/RecessionIndicatorUSA/USA-TRI.htm

  7. Joe Friday says:

    Today, the CEO of Honeywell, David Cote, claimed the real reason companies are not hiring is the fear of the massive debt in Europe and the U.S. and the lack of political will to deal with it.

    OH THE STUPIDITY !

  8. 1.) Greece fell off the cliff. Greece banks are €21 billion away from a complete banking collapse.
    2.) Contagion spread to Spain.
    3.) Governments backstopped banks and told them to liquidate whatever they had.
    4.) Markets got flooded with crap.
    5.) Contagion spread.

    This weekend either they’ll “print,” “bail” and “backstop” or Monday we’ll re-define contagion.