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by TheAntiDoomer » Mon 16 Jul 2012, 11:38:14
An index covering New York manufacturing activity climbed five points, though new orders in the region sunk into contractionary territory for the first time since November 2011, according to the Federal Reserve Bank of New York’s Empire State Manufacturing Survey released Monday.
The Empire State’s business conditions index rose to 7.4 in July, reversing a sharp fall in June that look the reading to just 2.29.
by careinke » Mon 16 Jul 2012, 11:42:43
by dolanbaker » Mon 16 Jul 2012, 12:28:18
http://www.bbc.co.uk/news/business-18854396
The global economic recovery is still at risk, and eurozone economies remain in a "precarious" situation, the International Monetary Fund has said.
A delayed or insufficient response from European leaders to the crisis would further derail the recovery, it said.
The IMF downgraded its forecast for global growth for 2013 to 3.9% from the 4.1% prediction it made in April.
One of the biggest downward revisions was to the UK, now expected to grow by 1.4% in 2013. In April it predicted 2%.
by Daniel_Plainview » Mon 16 Jul 2012, 13:09:45
OilFinder2 wrote:Well guess what? France is now in almost the same category as Germany.
France sells treasuries at negative yieldFrance sold six-month treasury bills at a negative yield for the first time, highlighting the reversal in sentiment towards Europe’s second-largest economy from last autumn when the eurozone crisis pushed its borrowing costs higher.
[...]
François Hollande, France’s newly elected president, has pledged to bring the national budget deficit down to 3 per cent of gross domestic product by 2013, primarily through tax hikes.
Underlining the appetite for highly rated assets amid uncertainty over the eurozone crisis, five-year UK gilt yields hit a record low on Monday of 0.57 per cent.
“All the major, highly rated economies have extremely short-term rates right now,” said Richard Batty, a global investment strategist at Standard Life Investments.
Nonetheless, for France it is a particularly significant improvement from last autumn when the mounting turmoil in Europe threatened to spill over from the continent’s periphery and into “core” countries like France.
Since peaking at 3.72 per cent in November, France’s 10-year bond yield has fallen to a low this year of 2.26 per cent in early July.
The recovery has been partially driven by the European Central Bank’s provision of over €1tn of three year loans to banks.
This allowed French asset managers to sell some of their holdings of periphery debt to newly liquid banks in those countries and repatriate the capital back to their home market.
Some investors and analysts remain cautious, given France’s large government sector, debt dynamics and economic outlook.
Although the spread, or difference, between Germany and France’s benchmark 10-year borrowing costs has narrowed from the record 190 basis points touched in November, it is still above 100bp, which is exceptionally high compared with the historical average.
“The large risk premium baked into French bonds, which can be seen from the still elevated spreads to German Bunds, could rise over time as investors focus on the structural problems in the economy,” Mr Batty said. “France’s economy is structurally weak.”
Meanwhile, the French corporate sector’s “operational profitability” – or gross operating surplus relative to gross value added – stood at its lowest since at least 1990 in the last quarter of 2011, according to Deutsche Bank economists.
v. read (rd), reading, reads
v.tr.
1. To examine and grasp the meaning of (written or printed characters, words, or sentences).
2. To utter or render aloud (written or printed material): read poems to the students.
3. To have the ability to examine and grasp the meaning of (written or printed material in a given language or notation): reads Chinese; reads music.
4.
a. To examine and grasp the meaning of (language in a form other than written or printed characters, words, or sentences): reading Braille; reading sign language.
b. To examine and grasp the meaning of (a graphic representation): reading a map.
5.
a. To discern and interpret the nature or significance of through close examination or sensitive observation: The tracker read the trail for signs of game.
b. To discern or anticipate through examination or observation; descry: "I can read abandonment in a broken door or shattered window" (William H. Gass).
6. To determine the intent or mood of: can read your mind like a book; a hard person to read.
7.
a. To attribute a certain interpretation or meaning to: read her words differently than I did.
b. To consider (something written or printed) as having a particular meaning or significance: read the novel as a parable.
8. To foretell or predict (the future).
9. To receive or comprehend (a radio message, for example): I read you loud and clear.
10. To study or make a study of: read history as an undergraduate.
11. To learn or get knowledge of from something written or printed: read that interest rates would continue to rise.
12. To proofread.
13. To have or use as a preferred reading in a particular passage: For change read charge.
14. To indicate, register, or show: The dial reads 32̊.
15. Computer Science To obtain (data) from a storage medium, such as a magnetic disk.
16. Genetics To decode or translate a sequence of messenger RNA into an amino acid sequence in a polypeptide chain.
v.intr.
1. To examine and grasp the meaning of printed or written characters, as of words or music.
2. To speak aloud the words that one is reading: read to the children every night.
3. To learn by reading: read about the storm in the paper today.
4. To study.
5. To have a particular wording: Recite the poem exactly as it reads.
6. To contain a specific meaning: As the law reads, the defendant is guilty.
7. To indicate, register, or show a measurement or figure: How does your new watch read?
8. To have a specified character or quality for the reader: Your poems read well.
OilFinder2 wrote:
by dolanbaker » Mon 16 Jul 2012, 13:44:56
http://www.davidmcwilliams.ie/2012/07/16/searching-for-real-growth
This week has been an extraordinary one for financial markets. On Friday, five straight days of losses were reversed in equity markets. The world is slowing down. The Chinese growth model, for so long the envy of the West, is stalling. The American recovery is spluttering and the crisis in Europe rumbles on.
What is happening is not that different from what happened in Ireland. A huge investment boom is coming to an end. But China has the resources to plough into the domestic economy, so let’s wait to see what happens there.
One of the dilemmas for China is that when you have an investment-led, rather than consumption-led boom, you tend to be left with overcapacity – an Asian version of a giant ghost estate. Cutting interest rates in such an environment, if it doesn’t boost consumption and goes into yet more investment, makes the problem worse.
Over in the US, something stranger is happening. The consumer, the great hope of America, has disappeared. Consumer spending is not responding to the many interest rate cuts the Federal Reserve has offered in the past few years. The problem now is that real interest rates are negative, so cuts in nominal interest rates are not going to help much.
In Europe, the ‘did they, didn’t they’ game goes on. The debate about what the Germans actually agreed to at the summit two weeks ago continues. Some high-placed people in Germany are saying that Chancellor Angela Merkel didn’t agree to backstop peripheral banking debts or if she did, she agreed to an accounting trick – taking debts off sovereign balance sheets but still making the sovereigns liable – rather than a eurozone debt mutualisation deal.
by Daniel_Plainview » Mon 16 Jul 2012, 14:02:11
To those on the hill and elsewhere who suggest this growing 'fiscal cliff' and 'debt ceiling' crisis will all get solved, former Office of Management and Budget (OMB) Director David Stockman tells Bloomberg TV that "they will punt, punt, punt and kick the can with partial solutions driven by eleventh hour crisis-based extensions that will go on for the whole of the next term!" When asked whether this economy will be mired in the doldrums, he rather ominously states "it will be worse, because we will be in recession" and notes that when the lame ducks re-look at the budget numbers with a realistic recession (instead of the current assumption of no recession within 12 years) it will be far worse and in a political environment where 'we cannot possibly raise taxes - and we cannot possibly cut spending'. With a 78% disapproval rating for the 'do nothing' Congress, Stockman is surprised that 16% somehow approve - approve of what? His warning is that unlike in past periods, today "we are completely paralyzed, there is an ideological divide on taxes and entitlement like we've never had before" and while he realizes that "the debt problem doesn't become a debt problem until the market suddenly have a wake up call and realize that if the Fed doesn't keep printing, it's game over.""The fact that rates are so low is not a reflection of the US as a safe-haven but a bet on the Fed not allowing rates to rise."
"The perverse low-rate environment simply tells Congress that they can borrow a trillion dollars for 10 billion a year."
If rates rose then it would break this huge partisan stalemate we have today"
"There is a huge costs to stalemate!"
In a little under six minutes, David factually describes the certainly-not-priced-in dismal reality of the political situation we face in the next few months... must watch...
by Daniel_Plainview » Mon 16 Jul 2012, 14:13:12
(Reuters) - American companies are scaling back plans to hire workers and a rising share of firms feel the European debt crisis is taking a bite out of their sales, a survey showed on Monday. Only 23 percent of the firms polled in June plan to add to staff in the next six months, the National Association for Business Economics said on Monday.
NABE's prior survey, conducted in late March and early April, had shown 39 percent of companies planning to add workers.
Already, hiring by U.S. companies has slowed dramatically in recent months as employers worry about a sagging global economy hurt by Europe's snowballing debt crisis.
Some economic data has suggested at least some of the hiring slowdown has been due to caution rather than a decline in business. A July 6 Labor Department report, for example, showed companies asked employees to work longer hours last month, even though they slowed the pace of hiring.
The NABE survey suggests such caution on hiring could continue.
The poll showed 47 percent of companies polled felt their sales have dropped due to Europe's woes.
Among companies that produce goods rather than provide services, the impact was even greater, with nearly four in five reporting a Europe-driven decline in revenues.
Three months earlier, only about a quarter of total firms polled thought sales had fallen
Oops! by Daniel_Plainview » Mon 16 Jul 2012, 14:40:06
The IMF believes that advanced economy deficits will decline by about 0.75 percentage points of GDP this year which 'strikes a compromise between restoring fiscal sustainability and supporting growth". However, continued focus on nominal deficit targets runs the risk of compelling excessive fiscal tightening if growth weakens. In addition, there is a risk in the United States of political gridlock that puts fiscal policy on autopilot and results in a sharp and sudden decline in deficits—the “fiscal cliff.” What is more troubling is the significant upward revision to all of the peripheral European nations (with Greece now at 171% Debt/GDP in 2013 versus 160.9% forecast only 3 months ago). While the average debt-to-GDP ratio among advanced economies is projected to continue to rise over the next two years, surpassing 110 percent of GDP on average in 2013, debt ratios will by then have peaked in several advanced economies - though rather explosively they do not see debt ratios for Spain and Japan stabilizing.
Debt/GDP ratios seen rising across Europe and most specifically Greece is losing it again and Spain bleeding fast...
Spain and Japan are seen to have debt ratios that are not stabilizing...
by TheAntiDoomer » Mon 16 Jul 2012, 14:53:40
Job openings rose to a seasonally adjusted 3.6 million, the Labor Department said Tuesday. That's up from 3.4 million in April. It's also the second-highest level in nearly four years, just behind March's 3.7 million.
A rise in openings could mean hiring will pick up in the coming months. It typically takes one to three months to fill a job.
by dsula » Mon 16 Jul 2012, 18:08:12
Daniel_Plainview wrote:OilFinder2 wrote:
Thank you for the photo of Paris. Very few of us have any concept of what Paris looks like, so your photo is extremely helpful. Even though we live in the Cyber Age, the Internet is virtually devoid of photos of Paris ... so we're impressed that you were able to hunt one down.
by Daniel_Plainview » Mon 16 Jul 2012, 21:33:04
Retail sales slipped for the third straight month in June, falling 0.5 percent according to the Commerce Department. Retail sales in May fell 0.2 percent. Most analysts were expecting a gain of 0.2 percent in June. The last time retail sales fell for three consecutive quarters was in late 2008.
U.S. consumers are being battered on many fronts: a weak housing market, a stagnant labor market and a decline in wages. The Thomson Reuters/University of Michigan index, a measure of U.S. consumer confidence, fell to 72 in July from 73.2 in June. Lower gasoline prices, one factor that usually boosts consumer spending, were not enough to lift retail sales in June. The 1.8 percent decrease in prices at the pump also contributed to the weaker-than-expected retail number. Department store spending fell 0.7 percent in June, motor vehicle and part sales dropped 0.6 percent and sales of electronics and furniture both slipped 0.8 percent.
Howard Davidowitz, chairman of Davidowitz & Associates and a longtime retail consultant, says he was not shocked by Monday's retail report. "The American consumer is going to continue to get poorer," he said. ...
US retail sales fell in June, marking the first time they have declined for three straight months since the height of the financial crisis in late 2008. The 0.5pc drop last month was marked by waning demand for goods ranging from furniture to electronics as Americans retrenched in the face of weak wage growth, a slowing jobs market and persistent fears over Europe’s debt crisis.
For the second quarter as a whole, retail sales fell at an annual pace of 0.8pc compared with an increase of 6.7pc in the first three months of the year when the country’s jobs market showed signs of improvement.
With the consumer again cutting back, the report raised fears among some economists that the US could slide back into recession.
“The report offers no quarter for those looking for good news for the US consumer,” said David Semmens, an economist at Standard Chartered. Nine of the 13 categories covered by today’s report from the Commerce Department showed declines, with essential categories such as food among the handful to buck the drop. ...
by Daniel_Plainview » Mon 16 Jul 2012, 21:36:21
Moody's cut its rating for 13 Italian banks this evening, citing the weakened borrower standing of the Italian government after its credit grade was downgraded last week.
The ratings fell by one to two notches, with Unicredit and Intesa Sanpaolo both falling to Baa2 from A3. "Today's actions follow the weakening of the Italian government's credit profile," Moody's said in a statement.
"Along with the increase in the risk of sovereign bond defaults, the downgrade of Italy's long-term ratings to Baa2 also indicates a similarly increased risk that the government might be unable to provide financial support to its banks in financial distress." Moody's said that banks are normally rated no higher than a government "due to multiple channels of shared exposure and contagion."
Italian banks, it said, have substantial exposure to the domestic economy and "high direct exposure" to sovereign debt.
Last Thursday Moody's cut the Italian government's rating two steps to Baa2 from A3, saying that Italy was now "more likely to experience a further sharp increase in its funding costs or the loss of market access" for borrowing to service its budget deficit.
by OilFinder2 » Tue 17 Jul 2012, 01:22:06
Daniel_Plainview wrote:1. Even François Hollande, the Socialist Extraordinaire, is so alarmed by France’s national debt that he's resolved to bring the budget deficit down to 3 per cent of gross domestic product by 2013, primarily through tax hikes.
2. France's lower rates have been partially driven by the European Central Bank’s provision of over €1tn of three year loans to banks. IOW, more central bank intervention; more centrally controlled economy; less free-market private capitalism. Do you get it now?
3. These are short-term rates, not 10-yr rates...
4. Speaking of long-term, 10-yr rates ... the spread between Germany and France’s benchmark 10-year borrowing costs is still above 100bp, which is exceptionally high compared with the historical average. And this large risk premium "could rise over time as investors focus on the structural problems in the economy; France’s economy is structurally weak.”
5. The French corporate sector’s “operational profitability” is at its lowest since at least 1990.
Sometimes in helps to read the article you post...
Thank you for the photo of Paris. Very few of us have any concept of what Paris looks like, so your photo is extremely helpful. Even though we live in the Cyber Age, the Internet is virtually devoid of photos of Paris ... so we're impressed that you were able to hunt one down.
by Daniel_Plainview » Tue 17 Jul 2012, 08:08:27
Daniel_Plainview wrote:OMB's Stockman: "We're At The Fiscal Endgame"To those on the hill and elsewhere who suggest this growing 'fiscal cliff' and 'debt ceiling' crisis will all get solved, former Office of Management and Budget (OMB) Director David Stockman tells Bloomberg TV that "they will punt, punt, punt and kick the can with partial solutions driven by eleventh hour crisis-based extensions that will go on for the whole of the next term!" When asked whether this economy will be mired in the doldrums, he rather ominously states "it will be worse, because we will be in recession" and notes that when the lame ducks re-look at the budget numbers with a realistic recession (instead of the current assumption of no recession within 12 years) it will be far worse and in a political environment where 'we cannot possibly raise taxes - and we cannot possibly cut spending'. With a 78% disapproval rating for the 'do nothing' Congress, Stockman is surprised that 16% somehow approve - approve of what? His warning is that unlike in past periods, today "we are completely paralyzed, there is an ideological divide on taxes and entitlement like we've never had before" and while he realizes that "the debt problem doesn't become a debt problem until the market suddenly have a wake up call and realize that if the Fed doesn't keep printing, it's game over.""The fact that rates are so low is not a reflection of the US as a safe-haven but a bet on the Fed not allowing rates to rise."
"The perverse low-rate environment simply tells Congress that they can borrow a trillion dollars for 10 billion a year."
If rates rose then it would break this huge partisan stalemate we have today"
"There is a huge costs to stalemate!"
In a little under six minutes, David factually describes the certainly-not-priced-in dismal reality of the political situation we face in the next few months... must watch...
"The numbers are so weak, there's a pretty good chance that we're in recession already, and it will be retroactively declared, if it isn't, we're drifting into it already"
"If the fed doesn't keep printing, it's game over."
"The Fed has been medicating and manipulating this bond market ... [and] the central banks own $5T of the $11T debt outstanding"
by Daniel_Plainview » Tue 17 Jul 2012, 08:43:30
This morning, following very weak retail sales and an Empire State index that showed a negative forward looking orders component, US 10-years have been exceptionally well bid, with yields making new lows at 1.44%.
The last time yields got this low was early June, when the Dow (DIA) and S&P 500 (SPY) were making their 2012 lows. The divergence over the past several weeks cannot possibly be sustained; either treasuries or equities will sell-off significantly.
While yields are down almost 30% since May, stocks have remained buoyed by everlasting hopes of QE and coordinated central bank rate cuts.
Further Explanation
The collapse in yields is largely a result of the now persistent meme, "flight to safety." With gold not being bid very well as European implosion fears have escalated over the past several months, there are very few assets that the market has deemed safe-havens. The main beneficiaries of the capital reallocation have been:
US treasuries
German bunds
US dollar
Highly rated municipals and corporates
Some US dividend paying stocks
I don't attribute very much of the price action in treasuries to hopes of further QE from the Fed. With each new Fed minutes or meeting that goes without promises of easing, treasury prices have often risen in response to flights from equities and precious metals, in conjunction with dollar strength. Of course, there is a definite ceiling on rates considering the Fed's ability and will to purchase treasuries directly.
Meanwhile, equities are failing to adequately discount both earnings and European (which of course translates to earnings) risk into prices as a consequence of ultra-easy monetary policy. The accepted term for this now is "The Bernanke Put," though as David Einhorn has explained, the put really only exists in the treasury market. By ensuring that the prices of treasuries will always rise, investors have desperately held on to their treasury holdings.
Similar to the Greenspan Put, Bernanke's version will not be able to hold a sustained floor under equity prices. With each new LSAP program from the Fed, the impact on the equity markets, and ultimately the economy, has been increasingly muted. We can see this overseas as well, given the ECB's famously brief success with its LTRO program.
Markets are failing to react to new injections of liquidity, which to me, implies they are about to come to terms with the structural issues that were supposed to have been mitigated by now.
Conclusions
US treasuries are foretelling of very stagnant, if not negative, US growth. Additionally, yields reflect undeniable skepticism relative to equities. I believe this is because pricing in bond markets is far more efficient than it is in equity markets, since the information for individual companies often lags by several months, and takes far longer to price into equities.
I should note that the above chart comparing yields and equities in no way implies a drop of 30% in the stock market. Rather, it reflects the economic reality that the bond market is seeing, and that the equity market is ignoring.
by TheAntiDoomer » Tue 17 Jul 2012, 08:47:29
Industrial production increased 0.4 percent in June after having declined 0.2 percent in May. In the manufacturing sector, output advanced 0.7 percent in June and reversed a decrease of 0.7 percent in May. In the second quarter of 2012, manufacturing output rose at an annual rate of 1.4 percent, a marked deceleration from its strong gain of 9.8 percent in the first quarter. The largest contribution to the increase in the second quarter came from motor vehicles and parts, which climbed 18.2 percent; excluding motor vehicles and parts, manufacturing output edged up 0.1 percent. Outside of manufacturing, the output of mines advanced 0.7 percent in June, while the output of utilities decreased 1.9 percent. For the quarter, however, the output of mines fell at an annual rate of 1.2 percent, while the output of utilities rose 14.9 percent. At 97.4 percent of its 2007 average, total industrial production in June was 4.7 percent above its year-earlier level. Capacity utilization for total industry moved up 0.2 percentage point in June to 78.9 percent, a rate 1.4 percentage points below its long-run (1972--2011) average.
by OilFinder2 » Tue 17 Jul 2012, 08:48:22
Industrial production in the U.S. increased in June, led by gains among automobile and machinery makers that signal manufacturing is boosting economic growth.
Output at factories, mines and utilities rose 0.4 percent last month after a revised 0.2 percent drop in May that was larger than previously reported, Federal Reserve data showed today in Washington. Economists forecast a 0.3 percent gain, according to the Bloomberg News survey median. Manufacturing, which makes up about 75 percent of total production, rose 0.7 percent last month, reversing the prior month’s decline.
The pickup in manufacturing may temper concerns of a bigger slowdown in the industry that has spearheaded the three-year-old expansion. At the same time, factories face the challenges of a weakening global economy and an American consumer hobbled by 8.2 percent unemployment and stagnant income growth.
“Manufacturing looked decent in June,” said Harm Bandholz, chief U.S. economist at UniCredit Group in New York, said before the report. “The risk is from the uncertainty over the global economic outlook and, more recently, the fiscal situation in the U.S., which means companies will meet demand more and more by drawing down inventories.”
[...]
by Daniel_Plainview » Tue 17 Jul 2012, 08:57:50
U.S. Treasury yields fell to the brink of new all-time lows [the 5-year is in fact at an all-time low today, but the WSJ reporter seems to only track the 10yr] as concerns about a U.S. economic slowdown spurred demand for financial safety, extending the market's rally this month.
The benchmark 10-year note yielded as little as 1.440% midday, a hair away from its 1.437% record low set on June 1 after a weak employment report. The yield on five-year notes sank as low as 0.577%, a new record for that maturity. Bond yields fall when prices rise.
A retail industry report early Monday showed sales falling for the third consecutive month in June, stoking fears about a snag in the U.S. recovery. Consumer spending, a crux of the U.S. economy, remains constrained by high unemployment and households' efforts to work off debt.
"Clearly things are slowing down, more so than most had expected," said Larry Milstein, head of government and agency trading at R.W. Pressprich & Co. "For a while, everyone was focused just on Europe. Now we're seeing the slowdown here and in China—major drivers of global growth."
by Daniel_Plainview » Tue 17 Jul 2012, 09:07:40
(July 17, 2012) Bill Gross, who runs the world’s largest mutual fund at Pacific Investment Management Co., said the U.S. is approaching a recession as BlackRock expects the Federal Reserve to take more steps to support growth.
Five-year Treasury yields slid to a record 0.577 percent yesterday after an unexpected drop in U.S. retail sales rekindled speculation Fed Chairman Ben S. Bernanke will use testimony today to hint at further monetary easing. That followed data earlier this month showing American employers added fewer-than-estimated workers to payrolls. Goldman Sachs and Deutsche Bank AG cut forecasts for U.S. growth.
The U.S. is “approaching recession when measured by employment, retail sales, investment, and corporate profits,” Gross, who manages the $263 billion Pimco’s Total Return Fund, wrote on Twitter yesterday.
...
Everything ‘Weaker’
Retail sales fell 0.5 percent in June, figures from the Commerce Department showed yesterday, exceeding the most pessimistic forecast in a Bloomberg News survey. U.S. employment increased 80,000 last month, according to a Labor Department report, trailing the 100,000 increase projected by economists.
“Pretty much everything is way weaker,” Ewen Cameron Watt, chief investment strategist at the BlackRock Investment Institute, told reporters today in a teleconference from London. “There will be some more action from the Federal Reserve, but not probably dramatic action in a sense of massive stimulus.”
... Goldman Sachs analysts led by Jan Hatzius cut their estimate for second-quarter economic growth to 1.1 percent from 1.3 percent, while Deutsche Bank chief U.S economist, Joseph LaVorgna, reduced his forecast to 1 percent from 1.4 percent.
“The sharp downward momentum in the economy” increases the probability of further Fed easing either in the form of another round of quantitative easing or other nonconventional measures, LaVorgna wrote in a note yesterday. “We need a couple of more weak employment reports, with figures near zero and with the unemployment rate increasing, for the Fed to undertake easing action.”
by Daniel_Plainview » Tue 17 Jul 2012, 09:19:31
Retailers saw fewer customers for the third consecutive month in June, a signal that weak job growth is forcing U.S. consumers to pare back purchases.
Sales fell be 0.5% to $401.5 billion, from the unrevised $403.4 billion in May, new Commerce Department data shows. Economists hoped that retail sales would rebound by 0.2%.
The three-month slump in retail sales mirrors the deceleration in job growth. The labor market went from an average of 226,000 jobs a month in the first quarter to only 75,000 in the second quarter, and as that pace slowed, Americans grew concerned about the health of the U.S. recovery. Worryingly, retail sales have not fallen into a three-month slump since late 2008.
“Retail sales have hit a brick wall, plain and simple,” says IHS economist Jim Dorsey. “The American consumer is not in a healthy state…This is a bad report. There is nothing very promising in the details.”
...It is quite unusual for retail sales to fall in three consecutive months, says FTN Financial economist Chris Low. The last time that happened, in the fourth quarter of 2008, was “not just a recessionary quarter but a particularly nasty recessionary quarter,” he says—a time when GDP declined by 6.2%, and the S&P 500 fell below 880, after starting at 1,213.
Economists pay close attention to retail figures. The data is often a useful figure when assessing consumer confidence, a key part to any recovery in the United States, where consumer spending drives 70% of all economic activity.
Other retail sectors experiencing large declines in June included building suppliers and sporting goods, which both dropped by 1.6%.
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