by Calculated Risk on 6/21/2020 06:54:00 PM

Weekend:
• Schedule for Week of June 21, 2020

Monday:
• At 8:30 AM ET, Chicago Fed National Activity Index for May. This is a composite index of other data.

• At 10:00 AM, Existing Home Sales for May from the National Association of Realtors (NAR). The consensus is for 4.10 million SAAR, down from 4.33 million. Housing economist Tom Lawler expects the NAR to report sales of 3.8 million SAAR for May.

From CNBC: Pre-Market Data and Bloomberg futures S&P 500 are down 38 and DOW futures are down 325 (fair value).

Oil prices were up over the last week with WTI futures at $39.41 per barrel and Brent at $42.13 barrel.  A year ago, WTI was at $57, and Brent was at $66 - so WTI oil prices are down about 30% year-over-year.

Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $2.13 per gallon. A year ago prices were at $2.66 per gallon, so gasoline prices are down $0.53 per gallon year-over-year.

by Calculated Risk on 6/21/2020 05:59:00 PM

Note: I started posting this graph when the US was doing a few thousand tests per day. Clearly the US was way under testing early in the pandemic. I'll continue posting this graph daily at least until the percent positive is continuously under 3% and the daily positive is significantly lower than today.

The US is now conducting over 500,000 tests per day, and that might be enough to allow test-and-trace in some areas. Based on the experience of other countries, the percent positive needs to be well under 5% to really push down new infections, so the US still needs to increase the number of tests per day significantly.

According to Dr. Jha of Harvard's Global Health Institute, the US might need more than 900,000 tests per day .

There were 518,347 test results reported over the last 24 hours.

There were 27,465 positive tests.

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 5.3% (red line).

For the status of contact tracing by state, check out testandtrace.com.

by Calculated Risk on 6/20/2020 05:38:00 PM

Note: I started posting this graph when the US was doing a few thousand tests per day. Clearly the US was way under testing early in the pandemic. I'll continue posting this graph daily at least until the percent positive is continuously under 3% and the daily positive is significantly lower than today.

The US is now conducting over 500,000 tests per day, and that might be enough to allow test-and-trace in some areas. Based on the experience of other countries, the percent positive needs to be well under 5% to really push down new infections, so the US still needs to increase the number of tests per day significantly.

According to Dr. Jha of Harvard's Global Health Institute, the US might need more than 900,000 tests per day .

There were 583,940 test results reported over the last 24 hours. This was a new daily high for test results.

There were 32,325 positive tests, the most since May 1st, and the second consecutive day over 30,000.

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 5.5% (red line).

For the status of contact tracing by state, check out testandtrace.com.

by Calculated Risk on 6/20/2020 11:14:00 AM

Housing economist Tom Lawler has been sending me his predictions of what the NAR will report for  10 years.  And he has graciously allowed me to share his predictions with the readers of this blog.

The table below shows the consensus for each month, Lawler's predictions, and the NAR's initially reported level of sales. 

Lawler hasn't always been closer than the consensus, but usually when there has been a fairly large spread between Lawler's estimate and the "consensus", Lawler has been closer.

The NAR is scheduled to release Existing Home Sales for May at 10:00 AM, Monday, June 22nd.

The consensus is for 4.10 million SAAR in May, down from 4.33 million in April. Tom Lawler estimates the NAR will report sales of 3.8 million SAAR and that inventory will be down about 20% year-over-year. Based on Lawler's estimate, I expect existing home sales to be below the consensus in May.

The consensus was 4.38 million SAAR for May, but moved down sharply after Lawler released his projections.   This happens frequently - analysts change their outlook based on Lawler's projections.   

NOTE: There have been times when Lawler "missed", but then he pointed out an apparent error in the NAR data - and the subsequent revision corrected that error.  As an example, see: The “Curious Case” of Existing Home Sales in the South in April

Over the last 10 years, the consensus average miss was 140 thousand, and  Lawler's average miss was 69 thousand.

Existing Home Sales, Forecasts and NAR Report millions, seasonally adjusted annual rate basis (SAAR)
Month	Consensus	Lawler	NAR reported1
May-10	6.20	5.83	5.66
Jun-10	5.30	5.30	5.37
Jul-10	4.66	3.95	3.83
Aug-10	4.10	4.10	4.13
Sep-10	4.30	4.50	4.53
Oct-10	4.50	4.46	4.43
Nov-10	4.85	4.61	4.68
Dec-10	4.90	5.13	5.28
Jan-11	5.20	5.17	5.36
Feb-11	5.15	5.00	4.88
Mar-11	5.00	5.08	5.10
Apr-11	5.20	5.15	5.05
May-11	4.75	4.80	4.81
Jun-11	4.90	4.71	4.77
Jul-11	4.92	4.69	4.67
Aug-11	4.75	4.92	5.03
Sep-11	4.93	4.83	4.91
Oct-11	4.80	4.86	4.97
Nov-11	5.08	4.40	4.42
Dec-11	4.60	4.64	4.61
Jan-12	4.69	4.66	4.57
Feb-12	4.61	4.63	4.59
Mar-12	4.62	4.59	4.48
Apr-12	4.66	4.53	4.62
May-12	4.57	4.66	4.55
Jun-12	4.65	4.56	4.37
Jul-12	4.50	4.47	4.47
Aug-12	4.55	4.87	4.82
Sep-12	4.75	4.70	4.75
Oct-12	4.74	4.84	4.79
Nov-12	4.90	5.10	5.04
Dec-12	5.10	4.97	4.94
Jan-13	4.90	4.94	4.92
Feb-13	5.01	4.87	4.98
Mar-13	5.03	4.89	4.92
Apr-13	4.92	5.03	4.97
May-13	5.00	5.20	5.18
Jun-13	5.27	4.99	5.08
Jul-13	5.13	5.33	5.39
Aug-13	5.25	5.35	5.48
Sep-13	5.30	5.26	5.29
Oct-13	5.13	5.08	5.12
Nov-13	5.02	4.98	4.90
Dec-13	4.90	4.96	4.87
Jan-14	4.70	4.67	4.62
Feb-14	4.64	4.60	4.60
Mar-14	4.56	4.64	4.59
Apr-14	4.67	4.70	4.65
May-14	4.75	4.81	4.89
Jun-14	4.99	4.96	5.04
Jul-14	5.00	5.09	5.15
Aug-14	5.18	5.12	5.05
Sep-14	5.09	5.14	5.17
Oct-14	5.15	5.28	5.26
Nov-14	5.20	4.90	4.93
Dec-14	5.05	5.15	5.04
Jan-15	5.00	4.90	4.82
Feb-15	4.94	4.87	4.88
Mar-15	5.04	5.18	5.19
Apr-15	5.22	5.20	5.04
May-15	5.25	5.29	5.35
Jun-15	5.40	5.45	5.49
Jul-15	5.41	5.64	5.59
Aug-15	5.50	5.54	5.31
Sep-15	5.35	5.56	5.55
Oct-15	5.41	5.33	5.36
Nov-15	5.32	4.97	4.76
Dec-15	5.19	5.36	5.46
Jan-16	5.32	5.36	5.47
Feb-16	5.30	5.20	5.08
Mar-16	5.27	5.27	5.33
Apr-16	5.40	5.44	5.45
May-16	5.64	5.55	5.53
Jun-16	5.48	5.62	5.57
Jul-16	5.52	5.41	5.39
Aug-16	5.44	5.49	5.33
Sep-16	5.35	5.55	5.47
Oct-16	5.44	5.47	5.60
Nov-16	5.54	5.60	5.61
Dec-16	5.54	5.55	5.49
Jan-17	5.55	5.60	5.69
Feb-17	5.55	5.41	5.48
Mar-17	5.61	5.74	5.71
Apr-17	5.67	5.56	5.57
May-17	5.55	5.65	5.62
Jun-17	5.58	5.59	5.52
Jul-17	5.57	5.38	5.44
Aug-17	5.48	5.39	5.35
Sep-17	5.30	5.38	5.39
Oct-17	5.30	5.60	5.48
Nov-17	5.52	5.77	5.81
Dec-17	5.75	5.66	5.57
Jan-18	5.65	5.48	5.38
Feb-18	5.42	5.44	5.54
Mar-18	5.28	5.51	5.60
Apr-18	5.60	5.48	5.46
May-18	5.56	5.47	5.43
Jun-18	5.45	5.35	5.38
Jul-18	5.43	5.40	5.34
Aug-18	5.36	5.36	5.34
Sep-18	5.30	5.20	5.15
Oct-18	5.20	5.31	5.22
Nov-18	5.19	5.23	5.32
Dec-18	5.24	4.97	4.99
Jan-19	5.05	4.92	4.94
Feb-19	5.08	5.46	5.51
Mar-19	5.30	5.40	5.21
Apr-19	5.36	5.31	5.19
May-19	5.29	5.40	5.34
Jun-19	5.34	5.25	5.27
Jul-19	5.39	5.40	5.42
Aug-19	5.38	5.42	5.49
Sep-19	5.45	5.36	5.38
Oct-19	5.49	5.36	5.46
Nov-19	5.45	5.43	5.35
Dec-19	5.43	5.40	5.54
Jan-20	5.45	5.42	5.46
Feb-20	5.50	5.58	5.77
Mar-20	5.30	5.25	5.27
Apr-20	4.30	4.17	4.33
May-20	4.10	3.80	NA
1NAR initially reported before revisions.

by Calculated Risk on 6/20/2020 08:11:00 AM

The key reports this week are the third estimate of Q1 GDP, May New and Existing Home Sales, and Personal Income and Outlays for May.

For manufacturing, the June Richmond and Kansas City Fed manufacturing surveys will be released.

----- Monday, June 22nd -----
8:30 AM ET: Chicago Fed National Activity Index for May. This is a composite index of other data.

10:00 AM: Existing Home Sales for May from the National Association of Realtors (NAR). The consensus is for 4.10 million SAAR, down from 4.33 million.

The graph shows existing home sales from 1994 through the report last month.

Housing economist Tom Lawler expects the NAR to report sales of 3.8 million SAAR for May.

----- Tuesday, June 23rd -----
10:00 AM: New Home Sales for May from the Census Bureau.

This graph shows New Home Sales since 1963. The dashed line is the sales rate for last month.

The consensus is for 640 thousand SAAR, up from 623 thousand in April.

10:00 AM: Richmond Fed Survey of Manufacturing Activity for June.

----- Wednesday, June 24th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

9:00 AM: FHFA House Price Index for April 2019. This was originally a GSE only repeat sales, however there is also an expanded index.

During the day: The AIA's Architecture Billings Index for May (a leading indicator for commercial real estate).

----- Thursday, June 25th -----
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for a 1.300 million initial claims, down from 1.508 million the previous week.

8:30 AM: Durable Goods Orders for May from the Census Bureau. The consensus is for a 10.6% increase in durable goods orders.

8:30 AM: Gross Domestic Product, 1st quarter 2020 (Third estimate). The consensus is that real GDP decreased 5.0% annualized in Q1, unchanged from the second estimate of a 5.0% decrease.

11:00 AM: the Kansas City Fed manufacturing survey for June. This is the last of regional manufacturing surveys for June.

----- Friday, June 26th -----
8:30 AM ET: Personal Income and Outlays, May 2020. The consensus is for a 6.0% decrease in personal income, and for a 9.0% increase in personal spending. And for the Core PCE price index to increase 0.2%.

10:00 AM: University of Michigan's Consumer sentiment index (Final for June). The consensus is for a reading of 78.9.

by Calculated Risk on 6/19/2020 05:55:00 PM

Note: I started posting this graph when the US was doing a few thousand tests per day. Clearly the US was way under testing early in the pandemic. I'll continue posting this graph daily at least until the percent positive is continuously under 3% and the daily positive is significantly lower than today.

The US is now conducting over 400,000 tests per day, and that might be enough to allow test-and-trace in some areas. Based on the experience of other countries, the percent positive needs to be well under 5% to really push down new infections, so the US still needs to increase the number of tests per day significantly.

According to Dr. Jha of Harvard's Global Health Institute, the US might need more than 900,000 tests per day .

There were 579,115 test results reported over the last 24 hours. There were 31,777 positive tests.

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 5.5% (red line).

For the status of contact tracing by state, check out testandtrace.com.

by Calculated Risk on 6/19/2020 01:35:00 PM

Note that May sales are for contracts typically signed in March and April - when the economy was shutdown - so the report for May is pretty weak. Sales will pick up in the June / July reports.

From SacRealtor.org: May 2020 Statistics – Sacramento Housing Market – Single Family Homes

May closed with 1,032 sales, up 1.9% from the 1,013 sales in April. Compared to one year ago (1,630), the current figure is a 36.7% drop.
...
The Active Listing Inventory decreased 2.6% from April to May, from 1,823 units to 1,775 units. Compared with May 2019 (2,314), inventory is down 23.3%. The Months of Inventory decreased from 1.8 Months to 1.7 Months. This figure represents the amount of time (in months) it would take for the current rate of sales to deplete the total active listing inventory
...
The Median DOM (days on market) increased from 7 to 9 and the Average DOM decreased from 16 to 19. “Days on market” represents the days between the initial listing of the home as “active” and the day it goes “pending.”
emphasis added

1) Overall sales decreased to 1,032 in May, down 36.7% from 1,630 in May 2019. Sales were up 1.9% from April 2020 (previous month).

2) Active inventory was at 1,775, down from 2,314 in May 2019. That is down 23.3% year-over-year.  This is the thirteenth consecutive month with a YoY decline in inventory.

by Calculated Risk on 6/19/2020 11:20:00 AM

Important: GDP is reported at a seasonally adjusted annual rate (SAAR). So a 33% Q2 decline is around 8% decline from Q1 (SA).

From Merrill Lynch:

We revise up 2Q GDP to -35% qoq saar from -40% and 3Q to 20% from 7%, given the faster and more successful reopening. [June 18 estimate]
emphasis added

From Goldman Sachs:

We have adjusted our real GDP growth forecasts and now expect -33% in Q2, +33% in Q3, and +8% in Q4 (vs. -36%, +29%, and +11% previously) in qoq annualized terms. [June 18 estimate]

From the NY Fed Nowcasting Report

The New York Fed Staff Nowcast stands at -19.0% for 2020:Q2 and -1.9% for 2020:Q3. [June 19 estimate]

And from the Altanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2020 is -45.5 percent on June 17, down from -45.4 percent on June 16. [June 17 estimate]

by Calculated Risk on 6/19/2020 10:09:00 AM

From the BLS: Regional and State Employment and Unemployment Summary

Unemployment rates were lower in May in 38 states and the District of Columbia, higher in 3 states, and stable in 9 states, the U.S. Bureau of Labor Statistics reported today. All 50 states and the District had jobless rate increases from a year earlier. The national unemployment rate declined by 1.4 percentage points over the month to 13.3 percent but was 9.7 points higher than in May 2019.
...
Nevada had the highest unemployment rate in May, 25.3 percent, followed by Hawaii, 22.6 percent, and Michigan, 21.2 percent. The rates in Delaware (15.8 percent), Florida (14.5 percent), Massachusetts (16.3 percent), and Minnesota (9.9 percent) set new series highs. (All state series begin in 1976.) Nebraska had the lowest unemployment rate, 5.2 percent.
emphasis added

Click on graph for larger image.

This graph shows the number of states (and D.C.) with unemployment rates at or above certain levels since January 1976.

Currently 33 states are above 10% unemployment rate (down from 46 states last month).

Ten states are above 15% (down from 20 states last month).

Three states are above 20% (Hawaii, Michigan, and Nevada).

One state (Nevada) is above 25% unemployment.

by Calculated Risk on 6/19/2020 08:21:00 AM

Note: Both Black Knight and the MBA (Mortgage Bankers Association) are putting out weekly estimates of mortgages in forbearance.

From Black Knight:

The number of homeowners in active forbearance fell again this week. Overall, the number of active forbearance plans is down 57K from last week, and 158K from the peak the week of May 22.

Click on graph for larger image.

As of June 16, 4.6 million homeowners remain in forbearance plans, representing 8.7% of all active mortgages, down from 8.8% last week. Together, they represent just over $1 trillion in unpaid principal ($1,012B). Some 6.8% of all GSE-backed loans and 12.1% of all FHA/VA loans are currently in forbearance plans.
emphasis added