by Calculated Risk on 9/15/2010 03:44:00 PM

Via Dow Jones (ht Brian):

Time Warner Cable ... CFO Robert Marcus said "subscriber environment very, very weak," thanks to high unemployment, high ... vacancies and "really anemic new home formation."

Although housing completions are at a record low (adding few net new housing units to the housing stock), additional household formation is key to absorbing the overhang of excess housing units.

by Calculated Risk on 9/15/2010 02:47:00 PM

From cartoonist Eric G. Lewis:

by Calculated Risk on 9/15/2010 11:18:00 AM

Notes: CoreLogic reports the year-over-year change. The headline for this post is for the change from June 2010 to July 2010. The CoreLogic HPI is a three month weighted average of May, June and July and is NSA.

From CoreLogic (formerly First American LoanPerformance): CoreLogic Home Price Index Remained Flat in July

CoreLogic ... today released its Home Price Index (HPI) that showed that home prices in the U.S. remained flat in July as transaction volumes continue to decline. This was the first time in five months that no year-over-year gains were reported. According to the CoreLogic HPI, national home prices, including distressed sales showed no change in July 2010 compared to July 2009. June 2010 HPI showed a 2.4 percent year-over-year gain compared to June 2009. ...

Although home prices were flat nationally, the majority of states experienced price declines and price declines are spreading across more geographies relative to a few months ago. Home prices fell in 36 states in July, nearly twice the number in May and the highest since last November when national home prices were declining," said Mark Fleming, chief economist for CoreLogic.

Click on graph for larger image in new window.

This graph shows the national CoreLogic HPI data since 1976. January 2000 = 100.

The index is flat over the last year, and off 28% from the peak.

The index is 6.1% above the low set in March 2009, and I expect to see a new post-bubble low for this index later this year or early in 2011.

by Calculated Risk on 9/15/2010 09:15:00 AM

From the Fed: Industrial production and Capacity Utilization

Industrial production rose 0.2 percent in August after a downwardly revised increase of 0.6 percent in July [revised down from 1.0 percent]. ... The index for manufacturing output rose 0.2 percent in August after having advanced 0.7 percent in July; the step-down in the rate of increase reflected a fallback in the production of motor vehicles and parts, which had jumped sharply in July. Excluding motor vehicles and parts, manufacturing output increased 0.5 percent in August after having gained 0.2 percent in July. ... At 93.2 percent of its 2007 average, total industrial production in August was 6.2 percent above its year-earlier level. The capacity utilization rate for total industry rose to 74.7 percent, a rate 4.7 percentage points above the rate from a year earlier and 5.9 percentage points below its average from 1972 to 2009.

Click on graph for larger image in new window.

This graph shows Capacity Utilization. This series is up 9.6% from the record low set in June 2009 (the series starts in 1967).

Capacity utilization at 74.7% is still far below normal - and well below the the pre-recession levels of 81.2% in November 2007. (Note: this is actual a decrease before the revision to July)

Note: y-axis doesn't start at zero to better show the change.

The second graph shows industrial production since 1967.

This is the highest level for industrial production since Oct 2008, but production is still 7.2% below the pre-recession levels at the end of 2007.

The increase in August was about consensus, however the sharp downward revision to July puts this below consensus.

by Calculated Risk on 9/15/2010 08:30:00 AM

From the NY Fed: Empire State Manufacturing Survey

The Empire State Manufacturing Survey indicates that conditions held relatively steady in New York’s manufacturing sector in September. The general business conditions index remained positive, although it slipped 3 points to 4.1. The new orders and shipments indexes were both up moderately for the month, at levels signaling stable activity.
...
Employment indexes were positive, suggesting that employment levels and the average workweek continued to expand over the month. The degree of optimism about the six-month outlook continued to deteriorate, with the future general business conditions index hitting its lowest level since early 2009.

These regional surveys have been showing a slowdown in manufacturing and are being closely watched right now. This was slightly below expectations.

by Calculated Risk on 9/15/2010 07:14:00 AM

The MBA reports: Mortgage Applications Decrease in Latest MBA Weekly Survey

The Refinance Index decreased 10.8 percent from the previous week. The seasonally adjusted Purchase Index decreased 0.4 percent from one week earlier.
...
The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.47 percent from 4.50 percent, with points increasing to 1.08 from 0.96 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

Click on graph for larger image in new window.

This graph shows the MBA Purchase Index and four week moving average since 1990.

Purchase applications are at about the levels of 1996 or 1997, suggesting existing home sales (closed transactions) in August, September and even October, will only be slightly higher than in July. Note: economist Tom Lawler's "early read" is for August existing home sales of 4.1 million SAAR.

by Calculated Risk on 9/14/2010 09:28:00 PM

Notes: this data is not seasonally adjusted. There is a very distinct seasonal pattern for imports, but not for exports. LA area ports handle about 40% of the nation's container port traffic.

The following graph shows the loaded inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container). Although containers tell us nothing about value, container traffic does give us an idea of the volume of goods being exported and imported.

Click on graph for larger image in new window.

Loaded inbound traffic was up 24% compared to August 2009. Inbound traffic is now up 4% vs. two years ago (August '08).

Loaded outbound traffic was down 2.6% from August 2009. Unlike imports, exports are still off from 2 years ago (off 17%).

For imports there is usually a significant dip in either February or March, depending on the timing of the Chinese New Year, and then usually imports increase until late summer or early fall as retailers build inventory for the holiday season. So part of this increase in August imports is just the normal seasonal pattern.

Based on this data, it appears the trade deficit with Asia increased again in August. Not only have the pre-crisis global imbalances returned, but exports appear to have peaked in May (no clear seasonal pattern), and have moved sideways or down over the last 6 months.

by Calculated Risk on 9/14/2010 05:50:00 PM

CR Note: This is from housing economist Tom Lawler:

The “early read” on existing home sales based on regional data suggests that existing home sales ran at a seasonally adjusted annual rate of around 4.1 million in August, up around 7% from July’s pace.

My “best guess” right now on the pending home sales index is that it will show a seasonally adjusted increase from July to August of around 4%.

CR Note: some bounce back was expected. This would put the months of supply around 11.5 months. This sales rate would be at about the levels of 1996 or 1997. Existing home sales for August will be released next week on Thursday (Sept 23rd).

by Calculated Risk on 9/14/2010 03:30:00 PM

This is the new UCLA Anderson Forecast and Ceridian Corporation index using real-time diesel fuel consumption data: Pulse of Commerce Index^TM

Press Release: August PCI Decline Signals Struggling Economy, but no Double-Dip

The Ceridian-UCLA Pulse of Commerce Index™ (PCI) by UCLA Anderson School of Management fell 1 percent in August, a disappointing number that closes out an erratic summer in the PCI.
...
“The August data is obviously discouraging after the cautious optimism created from July’s report,” said Ed Leamer, chief PCI economist. “There is not much to feel good about with the August data in terms of the unemployment picture, but there is a silver lining in that the August PCI is still far from double-dip territory."
...
“The restocking of inventory and exceptional growth in imports that were helping drive the transportation of goods and materials appears to be over,” said Craig Manson, senior vice president and index expert for Ceridian.
...
The PCI is based on an analysis of real-time diesel fuel consumption data from over the road trucking tracked by Ceridian ...

Click on graph for larger image in new window.

This graph shows the index since January 1999.

This is a new index, and doesn't have much of a track record in real time, although the data appears to suggest that the recovery has slowed - even stalled - over the last 4 months.

by Calculated Risk on 9/14/2010 02:57:00 PM

From DataQuick: Southern California Home Sales Fall in August; Median Price Dips

Southland home sales fell last month to the lowest level for an August in three years and the second-lowest in 18, the result of a worrisome job market and a lost sense of urgency among home shoppers. ... [sales were] down 2.1 percent from 18,946 sales in July, and down 13.8 percent from 21,502 sales in August 2009.

Last month’s sales were the lowest for the month of August since 2007, when 17,755 homes sold, and the second-lowest since August 1992, when 16,379 sold. Last month’s sales were 31.5 percent lower than the August average of 27,070 sales since 1988, when DataQuick’s statistics begin. The average change in sales between July and August is a gain of 3.9 percent ...

“The loss of home buyer tax credits explains much of the sales weakness over the past two months. But other factors are suppressing sales, too, such as the lack of meaningful job growth and potential buyers’ concerns about job security. Also, for many out home shopping now, there’s little beyond ultra-low mortgage rates to pressure them to buy sooner rather than later, especially in areas where the number of homes for sale is climbing,” said John Walsh, MDA DataQuick president.

The DataQuick data includes new home sales, but this suggests existing home sales in August were weak nationwide. I'll be looking for the compilation of regional reports from Tom Lawler!