Post by unlawflcombatnt on Oct 26, 2007 5:29:29 GMT -6
from Briefing.com:
September Durable Goods orders declined -1.7%. The prediction was for a +2.0% increase. The "experts" only over-estimated it by 3.7%.
Shipments declined -2.0%
Inventories increased +0.4%.
August was also revised lower to -5.3%.
Transportation provided the direction with a -6% decline despite the rise in aircraft. Vehicles fell only -3%.
Capital goods orders also fell.
from Briefing.com:
"The weak performance leaves durable goods, ex-transportation and core capital goods orders lower than a year ago.
Within the detail transportation, electronics and electrical equipment fell as machinery and primary metals showed the gains.
Weak durable goods orders (-8% yoy) don't provide much support for manufacturing and industrial production....
Durable goods order growth has fallen for two months to leave both 6 month and annual growth lower....
The risk ahead is that a weak economic growth outlook delays orders and slows manufacturing output thereby further slowing the economy.
Strong corporate balance sheets, high capacity use and rising exports remain positive underlying factors."
High Capacity Use?? (Meaning High % Capacity Use)
There's "high % capacity use" because total "capacity" has declined. Business investment in Capital Goods hasn't increased capacity, or even maintained current levels. September's 2007 Capital Goods Orders are -20% less than in September 2006.
At the end of September 2007, the year-to-date increase in New Orders for Capital Goods was +1.6%. In contrast, September 2006's year-to-date increase was +14.7%.
Capital Goods Shipments showed the same Sept vs. Sept. decline. For Sept. 2007, the ytd increase was +0.5%. For Sept. 2006, the ytd increase was +10.9%. September 2006's year-to-date increase was 22 times as much that in Sept. 2007.
Reduced capital equipment spending and closure of factories reduces industrial capacity. With reduced capacity, a constant amount of industrial activity gives a higher % of capacity use. We have a "high % capacity use" because we have less total capacity, not because we are using more.
(For example, if we were using 80% of our industrial capacity 1 year ago, that would be an 80% capacity utilization. But if the total capacity itself declined to only 80% of its level 1 year ago, the same level of usage as last year would give a 100% capacity usage level.)
New Orders for Durable Goods declined -8.3% in September 2007 compared to September 2006, from $237.410 billion down to $217.582 billion.
New Orders for Capital Goods were down -20% in September 2007, compared to September 2007. (from $102.801 billion down to $82.738 billion)
Inventories increased +$23 billion, or +8% from September 2006. (from $290.841 up to $313.868)
Durable Goods and Housing are both in RECESSION. Adding in an almost certain decline in consumer spending, and an economy wide recession is guaranteed.
September Durable Goods orders declined -1.7%. The prediction was for a +2.0% increase. The "experts" only over-estimated it by 3.7%.
Shipments declined -2.0%
Inventories increased +0.4%.
August was also revised lower to -5.3%.
Transportation provided the direction with a -6% decline despite the rise in aircraft. Vehicles fell only -3%.
Capital goods orders also fell.
from Briefing.com:
"The weak performance leaves durable goods, ex-transportation and core capital goods orders lower than a year ago.
Within the detail transportation, electronics and electrical equipment fell as machinery and primary metals showed the gains.
Weak durable goods orders (-8% yoy) don't provide much support for manufacturing and industrial production....
Durable goods order growth has fallen for two months to leave both 6 month and annual growth lower....
The risk ahead is that a weak economic growth outlook delays orders and slows manufacturing output thereby further slowing the economy.
Strong corporate balance sheets, high capacity use and rising exports remain positive underlying factors."
High Capacity Use?? (Meaning High % Capacity Use)
There's "high % capacity use" because total "capacity" has declined. Business investment in Capital Goods hasn't increased capacity, or even maintained current levels. September's 2007 Capital Goods Orders are -20% less than in September 2006.
At the end of September 2007, the year-to-date increase in New Orders for Capital Goods was +1.6%. In contrast, September 2006's year-to-date increase was +14.7%.
Capital Goods Shipments showed the same Sept vs. Sept. decline. For Sept. 2007, the ytd increase was +0.5%. For Sept. 2006, the ytd increase was +10.9%. September 2006's year-to-date increase was 22 times as much that in Sept. 2007.
Reduced capital equipment spending and closure of factories reduces industrial capacity. With reduced capacity, a constant amount of industrial activity gives a higher % of capacity use. We have a "high % capacity use" because we have less total capacity, not because we are using more.
(For example, if we were using 80% of our industrial capacity 1 year ago, that would be an 80% capacity utilization. But if the total capacity itself declined to only 80% of its level 1 year ago, the same level of usage as last year would give a 100% capacity usage level.)
New Orders for Durable Goods declined -8.3% in September 2007 compared to September 2006, from $237.410 billion down to $217.582 billion.
New Orders for Capital Goods were down -20% in September 2007, compared to September 2007. (from $102.801 billion down to $82.738 billion)
Inventories increased +$23 billion, or +8% from September 2006. (from $290.841 up to $313.868)
Durable Goods and Housing are both in RECESSION. Adding in an almost certain decline in consumer spending, and an economy wide recession is guaranteed.