Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Mixed Week For The Economy, And Far From Great

Even good news was not that great.

The trade data came in weak for imports - good for GDP but bad news for the economy as declining imports are a sign of economic weakness. Exports held their own indicating the global economy may not be as bad as many think. Incidentally, when I analyze trade data - it is inflation adjusted with oil imports removed.

Literally there has been little growth in imports over the last year. The good news is that the estimated tiny contraction in GDP for 4Q2012 likely was wiped out - and now should be a tiny expansion.

And wholesale sales and inventories were another bad data set coming in literally at recessionary levels (inventory levels at recession levels, and inflation adjusted sales contracting.

There were no other major data released last week, however I use the business activity subindex of the ISM Services (purchasing managers index for non-manufacturing) as a litmus test of the economy. The January number degraded, but is well out of recession territory

The Econintersect economic forecast for February 2012 continues to show weak growth. The underlying dynamics have a whiff of improvement - but the zinger in the data was a supply chain contraction. However all the recession markers have evaporated, and one of our alternate methods to validate our forecast remains recessionary (but still only slightly so). Basically, we are saying that not enough products (crude, intermediate, and finished) were moved for sales or manufacture in February.

ECRI now believes a recession began in July 2012. ECRI first stated in September 2011 a recession was coming . The size and depth is unknown. The ECRI WLI growth index value has been weakly in positive territory for over three months - but in a noticeable improvement trend. The index is indicating the economy six month from today will be slightly better than it is today.

Current ECRI WLI Growth Index

Initial unemployment claims fell marginally from 368,000 (reported last week) to 366,000 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 marginally from 352,000 (reported last week) to 350,500. 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.

Weekly Initial Unemployment Claims - 4 Week Average - Seasonally Adjusted - 2011 (red line), 2012 (green line), 2013 (blue line)

(click to enlarge)Click to enlarge

Bankruptcies this Week: General Automotive Company, America West Resources, Sino-Forest Company

Data released this week which contained economically intuitive components (forward looking) were:

  • Rail movements are somewhat improving looking at the 4 week average, but longer term trends are still declining.

All other data released this week either does not have enough historical correlation to the economy to be considered intuitive, or is simply a coincident indicator to the economy.

Weekly Economic Release Scorecard:
Investing.com Weekly Wrap-Up 08 February 2012
Pancreatic Cancer Cure
What We Read Today 08 February 2013
01 February 2013 ECRI's Weekly Leading Index Growth Index Continues to Rise
December 2012 Wholesale Sales & Inventories Has Recessionary Feel
December 2012 Trade Data Does Not Suggest the Economy is Strengthening
Infographic of the Day: Where Should You Be Born in 2013?
Japan Trade Deficit Pushes Current Account Surplus to Record Low
Wage Growth Squeezed - Can QE Help?
A Well-chosen War - What About the Peace?
Going Vertical
China: Trade Data Improves
Tradable Goods and Employment Futures
December 2012 Consumer Credit Growth Continues
What We Read Today 07 February 2013
Week Ending 02 February 2013: Four Week Average Improving
Productivity 4Q2012 (Preliminary): Productivity Down, Labor Costs Up
02 February 2013 Unemployment Claims 4 Week Average Down Marginally
Infographic of the Day: Moon's Enless Dance
Saving America, Chinese Style: Cover to Cover
Five Mistakes Investors Will Make in the Next 12 Months
CBO: Obamacare Coverage Estimates Shrink
Keith Jurow to Appear on Fox Business
What We Read Today 06 February 2013
CBO: Expects Slow Growth in 2013
Nonfinancial Leverage NFCI Again Deteriorated Slightly w/e 01 February 2013
CBO: Outlook for Deficits Collapsing
Macroeconomics and the Financial Cycle: Hamlet without the Prince?
EURUSD Technical Analysis Update
Tax Distributions Across 50 States
A Reliable Account of the Great Depression
Charter Schools: Debate About Effectiveness
S&P: It's $5 Billion!
Womenomics
Where Are All the Quality Breakouts?
Infographic of the Day: Superfoods Which Kill Cancer
December 2012 CoreLogic Home Prices Now Up 8.3% Year-over-Year
What We Read Today 05 February 2013
Is There A European Policy Shift in the Making Away from Austerity?
Stratfor: U.S. - Iranian Dialogue in Obama's Second Term
ISM Services Index Expands, But Softens in January 2013
S&P: Can It Survive a Suit for Fraud?
The Digital Age: Ending the Right to Read?
McKinsey: Costs for Needed Infrastructure Can Be Reduced
Olafur Ragnar Grimsson Iceland President 'Let Banks Go Bankrupt'
Where Does This Western Capitalist Mentality Come From?
Buy Signal: Top Hedge Funds Are Moving Into Energy
January Job Gains Were Right On Trend, But Not Enough To Shrink Unemployment and Stop Fed Printing
What We Read Today 04 February 2013
Infographic of the Day: Improving Your Google Quality Score
Manufacturing New Orders Downward Trend Continues in December 2012
Spain: Prime Minister Implicated in Corruption Ring
When the Gold Bugs Start Selling, Look Out!
France: "Totally Bankrupt"
Belgian MP Speaks Out Against Foreign Wars
College Loan Debt, Rising and Defaulting
Stiglitz and Krugman Discuss Inequality and the Crisis
Insider Trading 01 February 2013: Dan Loeb Sells 11 million Shares of Yahoo!
What We Read Today 03 February 2013
Does Rally Still Have Life?
Time to Unplug the World's Sick Man, the U.S.A.?
Infographic of the Day: Ultimate Guide to Contraception
Sunday Economic Comedy: Why the Government Does Not Prosecute
The Week Ahead: When the Correction?
FDIC Sues Bank Directors: What's Wrong with this Picture?
Fiat Money from Banks: An Argument for Gold
Actual Unemployment Claims Declined Sharply, Consistent With Trend
Spain Prepares A Move Away from Austerity
02 Feb. 2013: Seven of 13 Central Banks Cut Rates as Inflation Remains Subdued
Mary Jo White: Next SEC Chief's 'Skeleton in Closet'
Trefis: Highlights Week Ending 02 February 2013
What We Read Today 02 February 2013
A New Year's Resolution for Macroeconomists
Pending Home Sales Didn't Really Miss
Saturday Economic Comedy: Why the Economy Cannot Grow
Infographic of the Day: A Look at Ways to Get a Better Sleep
Does Taxation Kill Economic Growth?
The Fed Changing Private Portfolio Preferences through Quantitative Easing
Austerity for All?
Pew: Government Threatens Personal Rights
Max Kaiser: Geithner Accused of Insider Information Fraud 16 August 2007
Investing.com Weekly Wrap-Up 01 February 2012
Final January 2013 Michigan Consumer Sentiment Reverses the Preliminary's Dip
Click to enlarge

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