Steven Hansen's  Instablog

The Econintersect economic forecast for May 2012 shows moderate growth. There was some improvement in the government pulse point, but degradation in some of our transport related pulse points. Overall, the pluses and minuses balanced out.

ECRI has called a recession. Their data looks ahead at least 6 months and the bottom line for them is that a recession is a certainty. The size and depth is unknown but the recession start has been revised to hit around mid-year 2012.

This week ECRI's WLI index value has been jumping around due to backward revision. The index is hovering around zero which means the economy six month from today will be as bad as it is today.

Initial unemployment claims were essentially unchanged - 370,000 (reported last week) to 370,000 this week. Historically, claims exceeding 400,000 per week usually occur when employment gains are less than the workforce growth, resulting in an increasing unemployment rate (background here and here). The real gauge - the 4 week moving average - fell from 375,000 (reported last week) to 370,000. Because of the noise (week-to-week movements from abnormal events AND the backward revisions to previous weeks releases), the 4-week average remains the reliable gauge.

(click to enlarge)

Data released this week which contained economically intuitive components (forward looking) were rail movements which is still indicating a moderate expansion if one ignores coal. A this was a light data week, the only other remotely economic intuitive release was the Chicago Fed National Activity Index (CFNAI) which unfortunately is not accurate in real time due to backward revisions. This index was mixed but not close to being recessionary.

Weekly Economic Release Scorecard:

Ideology: Yet Another Similarity between Communism and Democracy
Dealing with the Global Financial Crisis: Focus Europe
Durable Goods Data Weak in April 2012
Current Economic Status and How to Invest
Convergence of Four Explosive Factors
April 2012 New Home Sales Growth Positive but Not Accelerating
My Best Web Based Stock Screening Tools
Who Pays for the Crisis?
April 2012 Existing Home Sales Volumes Continue to Improve
Employment: Has Been Improving but Outlook Weakening
Summary of Week Ending May 20, 2012
How the Euro Zone Would Build an Airplane
CFNAI Shows Economic Potential Degraded in April 2012
U.S. Northeast: Casino Glut Coming
Fallacies of Composition Challenge America
Investing in IPOs: Why You Should Think Twice About Facebook
The Conomy Game
Analysis of the Pain in Spain
The Week Ahead: Can the Euro Summit Help?
The Fable of "Moral Arithmetic"
Forget Peak Oil, Time To Worry About Peak Oil Labor
Trefis: Week in Review 18 May 2012
Economy Continues to Grow Under the Shadow of Recession
The Man Who Fired Alan Greenspan
April 2012 Sea Container Data Show Struggling Economy

Bankruptcies this Week: Houghton Mifflin Harcourt Publishing

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

The Econintersect economic forecast for May 2012 shows moderate growth. There was some improvement in the government pulse point, but degradation in some of our transport related pulse points. Overall, the pluses and minuses balanced out.

ECRI has called a recession. Their data looks ahead at least 6 months and the bottom line for them is that a recession is a certainty. The size and depth is unknown but the recession start has been revised to hit around mid-year 2012.

This week ECRI's WLI index value has been jumping around due to backward revision. The negative values seen in the last few weeks have now disappeared. However, this index is still showing the economy six month from today will be as bad as it is today.

Initial unemployment claims essentially increased from 365,000 (reported last week) to 370,000 this week. Historically, claims exceeding 400,000 per week usually occur when employment gains are less than the workforce growth, resulting in an increasing unemployment rate (background here and here). The real gauge - the 4 week moving average - fell from 383,500 (reported last week) to 375,000. Because of the noise (week-to-week movements from abnormal events AND the backward revisions to previous weeks releases), the 4-week average remains the reliable gauge.

(click to enlarge)

Data released this week which contained economically intuitive components (forward looking) were rail movements and the import portion of container imports. Rail movements data this week is still indicating a moderate expansion if one ignores coal. Container Imports are finally growing year-to-date, but the growth is sickly at less than 1.0%.

April 2012 Sea Container Data Show Struggling Economy
An Open Letter to Mitt Romney
May 2012 Philly Fed Survey Significantly Deteriorated
Leading Economic Indicator Falters in April 2012
JPMorgan Faux Hedges "European Distressed Debt". Why?
April 2012 Residential Permits Continue to Show Sector Expansion
April 2012 Industrial Production Comes in Strong
Empire State Survey Bounces Back in May 2012
Business Sales and Inventories Cools Somewhat In March 2012
April 2012 CPI Continues to Show Slowing Inflation
Seniors' Social Security Garnished for Student Debts
China is Adjusting
Poor Showing for Retail Sales in April 2012
When Will We Learn? The Banks Don't Think We Ever Will, But We Must
Gold And Silver Jewelry Investments
A Tale of Two Recessions: Still not Finished?
Risk in Low-Float Stocks
The Great Debate©: How to Resolve the Euro Crisis
The Week Ahead: Will Housing Help?
Bankster Power
Trefis: Week in Review 11 May 2012
Is Consumer Credit Fueling Retail Sales Growth?

Bankruptcies this Week: Ally Financial subsidiary - Residential Capital, LightSquared (fka Sky Terra Communications)

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

The Econintersect economic forecast for May 2012 shows moderate growth. There was some improvement in the government pulse point, but degradation in some of our transport related pulse points. Overall, the pluses and minuses balanced out.

ECRI has called a recession. Their data looks ahead at least 6 months and the bottom line for them is that a recession is a certainty. The size and depth is unknown but the recession start has been revised to hit around mid-year 2012.

This week ECRI's WLI index value was unchanged at -0.1, after the previous twelve weeks of index improvement. This index is now showing the economy six month from today will be as bad as it is today.

(click to enlarge)

Please see Econintersect's post Achuthan Doubles Down on Recession to get a summary of the statements made this week reaffirming that a recession is coming.

Initial unemployment claims essentially decreased from 388,000 (reported last week) to 365,000 this week. Historically, claims exceeding 400,000 per week usually occur when employment gains are less than the workforce growth, resulting in an increasing unemployment rate (background here and here). The real gauge - the 4 week moving average - rose from 381,750 (reported last week) to 383,500. Because of the noise (week-to-week movements from abnormal events AND the backward revisions to previous weeks releases), the 4-week average remains the reliable gauge.

(click to enlarge)

Data released this week which contained economically intuitive components (forward looking) were rail movements and the import portion of the trade balance. Rail movements data this week is still indicating a moderate expansion if one ignores coal. Imports returned to the lower end of the growth range that imports have remained in since mid-2011.

America: What is China's Political System, Anyway?
Continued Price Moderation in April 2012 Producer Price Index
Preliminary May 2012 Michigan Consumer Sentiment Highest Since 2008
Export and Import Prices Continue to Moderate in April 2012
March 2012 Trade Data Still Indicating Expanding Economy
Sports Economics Around the Globe
The Citadelia Political Economy Fantasy
Wholesale Sales Have a Bad Month in March 2012
Stay Safe With Gold And Silver Part 2, Stocks Or Bullion?
March 2012 JOLTS Continues to Predict Jobs Growth
Facebook is No. 2: Worth $30 Billion (NOT $100 B)
Student Loans Continue to Drive Consumer Credit in March 2012
Stumbling Blocks to Spending Our Way to Prosperity
April 2012 Employment Trends: Predicts Better Jobs In Coming Months
Are Junk Bonds Too Popular?
April 2012 Rail Movements: Worst Coal Shipment Decline Ever
The World: Darkness Slowly Descends
The Week Ahead: Candidates on Parade
Past Predictions Reviewed
Bankruptcy Costs Affect America's Debt Crisis
Reasons for Gold to Go Higher
Trefis: Week in Review 04 May 2012
Will Lack of U.S., Canada Support Impede the Eurozone Firewall?
April 2012 Ceridan-UCLA Index: Improves??

Bankruptcies this Week: Corporate Management Solutions

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.