ECONOMIC RECOVERY ACCELERATES AS HOUSING & MANUFACTURING IMPLODE – GOT IT?

6 comments

Posted on 24th July 2014 by Administrator in Economy |Politics |Social Issues

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This is classic economic propaganda. The government reported new home sales of 504,000 in May. The talking head douchebags on CNBC and the rest of the propaganda media declared this as proof of a housing recovery. New home sales COLLAPSED in June to 406,000. This is a 20% decrease from the number reported last month. But the captured assholes in the MSM are only reporting a moderate 8% decrease over last month. How can this be? It seems the stock market surge created by last month’s report was produced with fake numbers. New home sales weren’t really 504,000. They were 442,000. OOOPS!!!! Why does the government report numbers at all until they know what they really are? A 13% error in one month is a fucking disgrace. When people in the real world make 13% mistakes, they are fucking fired. How many times has the government underestimated a key economic number by 13%? Never. The errors are always in the negative direction and the government and propaganda media expect the error to be lost in translation.

Government reported data is like the American Dream – you’d have to be asleep to believe it.

New Home Sales Collapse 20% From May To Dec 2012 Levels; Biggest Miss In A Year

Tyler Durden's picture

New Home Sales in June plunged to 406k vs 504k in May  (remember that 504k print was the catalyst for ‘weather’ is over and the market to surge: it somehow was magically revised lower by more than 10% to only 442K) Now that has soaked in, consider this is equal lowest sales print since September 2013 (and Dec 2012) and the biggest miss since July 2013.

The last 3 months of exuberance have all been revised significantly lower as follows:

  • March: 410K to 408K
  • April: 425K to 408K
  • May: 504K to 442K

What is even more troubling in the “survey” vs “reality” world is this collapse in sales when NAHB Sentiment surged to near cycle highs. For context, this is a 5-standard-deviation miss from economists’ expectations, below the lowest guess and a massive miss from almost highest estimate Joe Lavorgna’s 510k.

 

 

 

Where the biggest revision was: sales in the West. One wonders how it is possible to overestimate sales in one region by 20%?

 

And this is all going to be quite a shock for the homebuilders…

 

Finally, here is your long-term recovery:

 

US Manufacturing PMI Drops, Biggest Miss On Record

Tyler Durden's picture

But, but, but… the rest of the world’s PMIs are soaring as soft-survey data trumps any hard data facts. US Manufacturing dropped from 57.3 to 56.3 despite analysts that were convinced it should rise further to 57.5. This is the biggest miss on record, and the 2nd miss in a row. In spite of soaring markets proving the recoverty is just picking up and accelerating, new export orders weakened, manufacturing production fell, input costs surged, and employment tumbled to 10-month lows. But, stocks are surging on this dismal news…

 

 

as Employment tumbled to its worst of the year!

“Worryingly, job creation slid to its lowest since last September, which in part reflects concerns that current sales growth may not be sustained. A key source of concern is export sales, which continue to show disappointingly meagre gains”

 

*  *  *

A gentle reminder from BofA of the uselessness of the soft survey based PMI data…

the US data mills churn out a lot of surveys. Since the last FOMC meeting, there have been four new ISM readings and a bunch of regional releases. A popular view is that these surveys are better than hard data.

 

In our view, however, these data get way too much air time. They give a timely, rough read on the economy, but should get little weight once hard data are released.

6 Comments
  1. overthecliff says:

    Just keep stocking up on food and ammo. Quietly. It hasn`t collapsed yet.

    24th July 2014 at 12:59 pm

  2. AWD says:

    GDP was negative, macro data is collapsing, incomes dropping, housing collapsing, mortgage apps collapsing, trade deficit exploding….recession/depression imminent….but the bullshit shill financial MSM keep running their filth mouths, bubbles, bubbles, everywhere…….

    Greenspan says bubbles can’t be stopped without ‘crunch’

    Former Fed chairman worries about false dawns and the looming Fed exit

    July 24, 2014 By Greg Robb, MarketWatch

    WASHINGTON (MarketWatch) — Former Federal Reserve Chairman Alan Greenspan has always been a student of the economy. Since the financial crisis, he’s become a student of human nature.

    Sitting in his office with a view of the Washington Monument in the distance, Greenspan is eager to share the insight distilled in his recent book, “The Map and the Territory,” due out in paperback this fall.

    ‘There is definite evidence the economy is picking up. The financial system is finally beginning to lend. But, what we don’t know is whether, when the recovery gets underway, it is going to run into another false dawn.’

    Greenspan, 88, who was chairman of the U.S. central bank for more than 18 years, from 1987 to 2006, managed to steer the economy through multiple crises, mainly by slashing rates and remaining upbeat. He suffered a remarkable fall from grace after leaving office and has apologized for trusting big banks too much. He has since gone back and re-examined his views on the economy.

    Greenspan, now the president of Greenspan Associates LLC, an economic consulting firm, spoke to MarketWatch about the current stance of Fed policy, the economy and what to do about asset bubbles. The economy will do all right in the near term, he said, buoyed by a strong equity market, but he added that he remains worried that we could be facing another false dawn.

    The interview has been edited for length and clarity.

    MarketWatch: What is the biggest challenge facing the Fed?

    Greenspan: How to unwind the huge increase in the size of its balance sheet with minimal impact. It is not going to be easy, and it is not obvious exactly how to do it.

    MarketWatch: As the Fed is looking at the exit, do you think we can get through this without upsetting the economy?

    Greenspan: I certainly hope so. I certainly think they will. But it is going to be difficult.

    MarketWatch: Do you expect a sharp market reaction to the first hike?

    Greenspan: Of course. Look what happened when the first indication of tapering occurred. Markets have always been sensitive. They reflect animal spirits.

    Greenspan: I am not sure. One area I was always doubtful about during my tenure is how much we could effectively communicate to markets, because they were always second guessing the Fed. It was a battle, and I am not sure we always won.

    24th July 2014 at 1:42 pm

  3. ThePessimisticChemist says:

    My company is doing well, fantastic actually. We have almost maximized our ability to produce using the facility we currently have.

    Unfortunately, our CEO thinks that this means its time to BUY BUY BUY and has been blowing chunks of change left and right.

    Big and flashy, tons of new marketing material yadda yadda.

    Something tells me that when the shit hits the fan he’ll jet set with his 50M payout and leave the company high and dry.

    24th July 2014 at 3:12 pm

  4. AWD says:

    There Will Be No Warning When the Next Crisis Hits

    Submitted by Phoenix Capital Research

    Yesterday we wrote about the Cyprus bank “bail-in” noting that while ordinary citizens were screwed, connected insiders had ample time to get their money out of the banks before they were frozen.

    Today, we note the following:

    Russian oligarchs who are close to Vladimir Putin have a week to get their cash out of Britain before sanctions are imposed, it has emerged.

    European Union officials started on Tuesday to prepare the list of businessmen and Moscow officials who will be targeted by the sanctions.

    Philip Hammond, the Foreign Secretary, has made clear the Britain’s desperation to take action at those close to Mr Putin’s regime, saying “the cronies of Mr Putin and his clique in the Kremlin are the people who have to bear the pressure”.

    However, British sources disclosed that it will not be until the end of the month that all EU countries will have prepared their lists of individuals to be hit with the sanctions.

    The length of time before any action against these so-called Putin cronies will fuel concerns that they can withdraw their money before sanctions are imposed.

    http://www.telegraph.co.uk/news/politics/10986950/Putin-cronies-get-a-week-to-pull-their-cash-out-of-Britain-as-EU-drags-its-feet.html

    We don’t ever recall hearing of an instance in which ordinary citizens or taxpayers were given a heads up to get their money out of harm’s way. Usually when they bear the pressure it’s measures in Dollars… not the number of days’ warning they are given to save their capital.

    Indeed, there are usually no warnings that trouble is coming because everyone at the top of the financial food chain are highly incentivized to keep quiet about problems.

    Central Banks, Bank CEOs, politicians… all of these people are focused primarily on maintaining CONFIDENCE in the system, NOT on fixing the system’s problems. Indeed, they cannot even openly discuss the system’s problems because it would quickly reveal that they are a primary cause of them.

    Remember back in 2007 and 2008? Time and again then-Fed Chairman Ben Bernanke stated that the sub-prime crisis was “contained” and that there would be little spillover into the economy.

    Bernanke was not alone. Just about every CEO from every major bank spent much of 2008 claiming that all was well, that there was no real need to raise capital, and that their exposure to toxic mortgage backed securities was minimal.

    Most of their banks had to be either merged with other entities or went bankrupt.

    For that reason, you will never and I repeat NEVER see a Central banker, Bank CEO, or politician admit openly what is happening in the financial system.

    Even middle managers and lower level employees won’t talk about it because A) they don’t know the truth concerning their institutions or B) they could be fired for warning others.

    As former banker Jean-Claude Juncker put it, “When it becomes serious, you have to lie.”

    So why does these people lie?

    Central bankers lie because they draw all of their power based on the fact that they are beyond oversight or regulation. The minute they lose this power, it becomes obvious that Central Banks and Central Bankers are one of the primary causes of the financial system’s problems.

    Ordinary bankers lie because if they were honest, their banks would collapse, they would lose their salaries/ bonuses, and they would very likely face legal actions.

    This is why no one in a position of financial power will ever publicly state, “such and such bank is in trouble… it would be wise to move your money.”

    Instead, what you’ll be told is, “we need to confiscate some of your savings to prop this bank up… if you don’t agree to this, the bank will collapse and you’ll have nothing.”

    This is of course, assuming you are even told this. As the folks in Cyprus found out, often times they’re not even told what’s going to happen, they simply wake up to find themselves locked out of their account.

    http://www.zerohedge.com/news/2014-07-24/there-will-be-no-warning-when-next-crisis-hits

    24th July 2014 at 3:57 pm

  5. Stucky says:

    So-called “experts” are blaming Millennials for not buying homes.

    24th July 2014 at 4:48 pm

  6. AWD says:

    Steve “Debt-Is-Good” Liesman Meets Barack “Hope-Is-Better” Obama – Live Feed
    Submitted by Tyler Durden on 07/24/2014 – 17:00

    Grab your popcorn as The Socialist Singularity comes to be… We are sure Steve Liesman will ask his ‘economics reporter’ questions while cow-towing to his glorious leader’s position on job-destroying ‘minimum wage’ increases, unpatriotic (though legal) inversions, Fed-driven inequality, and the massive and unprecedented divergence between “bubble” markets and the minions that make it up… always remember “debt-is-good” but “hope-is-better.”

    24th July 2014 at 5:03 pm

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