by Calculated Risk on 11/15/2020 08:07:00 PM

The end of the pandemic is coming, possibly by Q2 2021! Please be careful, especially over the holidays. Thanksgiving, Christmas and New Years will be tough this year, but keep your guard up - plan now to have safe holidays.

The US is now averaging over 1 million tests per day. Based on the experience of other countries, for adequate test-and-trace (and isolation) to reduce infections, the percent positive needs to be well under 5% (probably close to 1%), so the US still needs to increase the number of tests per day significantly (or take actions to push down the number of new infections).

There were 1,169,428 test results reported over the last 24 hours.

There were 139,109 positive tests.  Highest for a Sunday.

Over 15,000 US deaths have been reported so far in November. See the graph on US Daily Deaths here.

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 11.9% (red line is 7 day average).  The percent positive is calculated by dividing positive results by the sum of negative and positive results (I don't include pending).

And check out COVID Exit Strategy to see how each state is doing.

The second graph shows the 7 day average of positive tests reported and daily hospitalizations.

The dashed line is the previous hospitalization maximum.

Note that there were very few tests available in March and April, and many cases were missed, so the hospitalizations was higher relative to the 7-day average of positive tests in July. 

Now, there are many more tests, and many cases are being detected earlier - so hospitalizations have lagged.

• 7-day average cases are at a new record.

• Record Hospitalizations.

by Calculated Risk on 11/15/2020 01:41:00 PM

With the ten year yield at 0.89%, and based on an historical relationship, 30-year rates should currently be around 3.0%.

Mortgage News Daily reports that the most prevalent 30 year fixed rate is now at 2.94% for top tier scenarios. So mortgage rates are about as expected.

The graph shows the relationship between the monthly 10 year Treasury Yield and 30 year mortgage rates from the Freddie Mac survey.

Currently the 10 year Treasury yield is at 0.89%, and 30 year mortgage rates were at 2.84% according to the Freddie Mac survey last week - close to expected.

The record low in the Freddie Mac survey was 2.78% in the week ending November 5, 2020 (Survey started in 1971).

Freddie Mac has a similar graph here with a linear fit (using data since 1990).   Using their formula, 30 year rates would be around 2.77%.

by Calculated Risk on 11/14/2020 06:04:00 PM

The end of the pandemic is coming, possibly by Q2 2021! Please be careful, especially over the holidays. Thanksgiving, Christmas and New Years will be tough this year, but keep your guard up - plan now to have safe holidays.

The US is now averaging over 1 million tests per day. Based on the experience of other countries, for adequate test-and-trace (and isolation) to reduce infections, the percent positive needs to be well under 5% (probably close to 1%), so the US still needs to increase the number of tests per day significantly (or take actions to push down the number of new infections).

There were 1,343,467 test results reported over the last 24 hours.

There were 163,473 positive tests.

Over 14,500 US deaths have been reported so far in November. See the graph on US Daily Deaths here.

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 12.2% (red line is 7 day average).  The percent positive is calculated by dividing positive results by the sum of negative and positive results (I don't include pending).

And check out COVID Exit Strategy to see how each state is doing.

The second graph shows the 7 day average of positive tests reported and daily hospitalizations.

The dashed line is the previous hospitalization maximum.

Note that there were very few tests available in March and April, and many cases were missed, so the hospitalizations was higher relative to the 7-day average of positive tests in July. 

Now, there are many more tests, and many cases are being detected earlier - so hospitalizations have lagged.   Hospitalizations are now at a new record.

This is a new record 7-day average cases for the USA.

by Calculated Risk on 11/14/2020 08:11:00 AM

The key economic reports this week are October Retail Sales, Housing Starts and Existing Home Sales.

For manufacturing, October industrial production, and the November New York, Philly and Kansas City Fed surveys, will be released this week.

----- Monday, November 16th -----
8:30 AM: The New York Fed Empire State manufacturing survey for November. The consensus is for a reading of 13.8, up from 10.5.

----- Tuesday, November 17th -----
8:30 AM ET: Retail sales for October will be released.

The consensus is for a 0.5% increase in retail sales.

This graph shows the year-over-year change in retail sales and food service (ex-gasoline) since 1993. Retail and Food service sales, ex-gasoline, increased by 6.8% on a YoY basis.

9:15 AM: The Fed will release Industrial Production and Capacity Utilization for October.

This graph shows industrial production since 1967.

The consensus is for a 1.0% increase in Industrial Production, and for Capacity Utilization to increase to 72.4%.

10:00 AM: The November NAHB homebuilder survey. The consensus is for a reading of  85, unchanged from 85. Any number above 50 indicates that more builders view sales conditions as good than poor.

11:00 AM: NY Fed: Q3 Quarterly Report on Household Debt and Credit

----- Wednesday, November 18th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

8:30 AM: Housing Starts for October.

This graph shows single and total housing starts since 1968.

The consensus is for 1.460 million SAAR, up from 1.415 million SAAR.

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

----- Thursday, November 19th -----
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is initial claims decreased to 700 thousand from 709 thousand last week.

8:30 AM: the Philly Fed manufacturing survey for November. The consensus is for a reading of 24.0, down from 32.3.

10:00 AM: Existing Home Sales for October from the National Association of Realtors (NAR). The consensus is for 6.45 million SAAR, down from 6.54 million in September.

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

11:00 AM: the Kansas City Fed manufacturing survey for November.

----- Friday, November 20th -----
10:00 AM: State Employment and Unemployment (Monthly) for October 2019

by Calculated Risk on 11/13/2020 07:08:00 PM

The end of the pandemic is coming, possibly by Q2 2021! Please be careful, especially over the holidays. Thanksgiving, Christmas and New Years will be tough this year, but keep your guard up - plan now to have safe holidays.

The US is now averaging over 1 million tests per day. Based on the experience of other countries, for adequate test-and-trace (and isolation) to reduce infections, the percent positive needs to be well under 5% (probably close to 1%), so the US still needs to increase the number of tests per day significantly (or take actions to push down the number of new infections).

There were 1,383,088 test results reported over the last 24 hours.

There were 170,333 positive tests. This is a new record.

Over 13,000 US deaths have been reported so far in November. See the graph on US Daily Deaths here.

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 12.3% (red line is 7 day average).  The percent positive is calculated by dividing positive results by the sum of negative and positive results (I don't include pending).

And check out COVID Exit Strategy to see how each state is doing.

The second graph shows the 7 day average of positive tests reported and daily hospitalizations.

The dashed line is the previous hospitalization maximum.

Note that there were very few tests available in March and April, and many cases were missed, so the hospitalizations was higher relative to the 7-day average of positive tests in July. 

Now, there are many more tests, and many cases are being detected earlier - so hospitalizations have lagged.   Hospitalizations are now at a new record.

This is a new record 7-day average cases for the USA.

by Calculated Risk on 11/13/2020 02:14:00 PM

The Department of Transportation (DOT) reported:

Travel on all roads and streets changed by -8.6% (-23.4 billion vehicle miles) for September 2020 as compared with September 2019. Travel for the month is estimated to be 248.3 billion vehicle miles.

The seasonally adjusted vehicle miles traveled for September 2020 is 247.2 billion miles, a -9.7% (-26.7 billion vehicle miles) decline from September 2019. It also represents 2.8% increase (6.7 billion vehicle miles) compared with August 2020.

Cumulative Travel for 2020 changed by -14.5% (-355.5 billion vehicle miles). The cumulative estimate for the year is 2,093.1 billion vehicle miles of travel.
emphasis added

Click on graph for larger image.

This graph shows the rolling 12 month total vehicle miles driven to remove the seasonal factors.

Miles driven declined during the great recession, and the rolling 12 months stayed below the previous peak for a record 85 months.

Miles driven declined sharply in March, and really collapsed in April.   

This graph shows the YoY change in vehicle miles driven.

Miles driven rebounded in May through August, but is still down 9.7% YoY (seasonally adjusted).  

Based on gasoline consumption, I expect the year-over-year decline in vehicle miles to be about the same in October as in September.

by Calculated Risk on 11/13/2020 01:32:00 PM

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

This data is as of November 10th.

From Black Knight: Another Week of Strong Forbearance Improvement

After declining by 5% last week, the number of loans in active forbearance saw another week of strong improvement.

According to the latest weekly snapshot of Black Knight’s McDash Flash daily forbearance tracking data, active forbearance plans fell by 121,000 (-4%) over the last week. Overall, that puts forbearance volumes down 9% (-416,000) since the start of November..
...
As of November 10, there are now 2.74 million homeowners in active forbearance plans, representing approximately 5.2% of all active mortgages, down from 5.4% from last week. Together, they represent $559 billion in unpaid principal.

Click on graph for larger image.

Forbearance starts pulled back, with the week’s 68,000 starts marking the lowest weekly total since the first week of October. New forbearance starts (excluding restarts) hit a COVID-era low of just 31,000. Another 98,000 homeowners had their forbearance plans extended this week.
...
Of the 2.74 million loans still in active forbearance, 81% have had their terms extended at some point since March.

With COVID-19 cases rising across the country, it will be important to keep an eye on unemployment numbers and forbearance starts over the coming weeks. Black Knight will continue to monitor the situation and report our findings on this blog.
emphasis added

by Calculated Risk on 11/13/2020 11:45:00 AM

Most economists are revisiting their Q4 forecasts. In their previous forecasts, many assumed some additional disaster relief in Q4, and many underestimated the current surge in COVID.

Goldman Sachs economists noted this morning:

European and US economies are likely to slow significantly in Q4/Q1 as colder weather puts upward pressure on case growth, in turn triggering restrictions, but reaccelerate sharply in Q2/Q3 following warmer weather, the end of European lockdowns, and mass vaccination.

One well known private forecaster (with a great track record) in now forecasting negative GDP in Q4. Depending on further delays in disaster relief, and the impact of the COVID surge, we might see others move to negative GDP soon.

From the NY Fed Nowcasting Report

The New York Fed Staff Nowcast stands at 2.86% for 2020:Q4. [Nov 13 estimate]

And from the Altanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2020 is 3.5 percent on November 6, up from 3.2 percent on November 4. [Nov 6 estimate]

by Calculated Risk on 11/13/2020 08:45:00 AM

From HotelNewsNow.com: STR: US hotel results for week ending 7 November

U.S. weekly hotel occupancy was relatively flat from the previous week, according to the latest data from STR through 7 November.

1-7 November 2020 (percentage change from comparable week in 2019):

• Occupancy: 44.2% (-35.9%)
• Average daily rate (ADR): US$91.40 (-31.1%)
• Revenue per available room (RevPAR): US$40.36 (-55.8%)

Down slightly from 44.4% the prior week, the country’s occupancy level was its lowest since the week of June 14-20.
emphasis added

Since there is a seasonal pattern to the occupancy rate - see graph below - we can track the year-over-year change in occupancy to look for any improvement. This table shows the year-over-year change since the week ending Sept 19, 2020:

Week Ending	YoY Change, Occupancy Rate
9/19	-31.9%
9/26	-31.5%
10/3	-29.6%
10/10	-29.2%
10/17	-30.7%
10/24	-31.7%
10/31	-29.0%
11/7	-35.9%

This suggests no improvement over the last 8 weeks, and occupancy might be getting worse. Some of the recent decline in the occupancy rate is just seasonal.

The following graph shows the seasonal pattern for the hotel occupancy rate using the four week average.

Click on graph for larger image.

The red line is for 2020, dash light blue is 2019, blue is the median, and black is for 2009 (the worst year since the Great Depression for hotels - before 2020).

Seasonally we'd expect the occupancy rate to decline into the new year. Note that there was little pickup in business travel that usually happens in the Fall.

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

by Calculated Risk on 11/12/2020 06:47:00 PM

The end of the pandemic is coming, possibly by Q2 2021! Please be careful, especially over the holidays. Thanksgiving, Christmas and New Years will be tough this year, but keep your guard up - plan now to have safe holidays.

The US is now averaging over 1 million tests per day. Based on the experience of other countries, for adequate test-and-trace (and isolation) to reduce infections, the percent positive needs to be well under 5% (probably close to 1%), so the US still needs to increase the number of tests per day significantly (or take actions to push down the number of new infections).

There were 1,159,951 test results reported over the last 24 hours.

There were 150,526 positive tests. This is a new record.

Over 12,000 US deaths have been reported so far in November. See the graph on US Daily Deaths here.

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 13.0% (red line is 7 day average).

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

And check out COVID Exit Strategy to see how each state is doing.

The second graph shows the 7 day average of positive tests reported and daily hospitalizations.

The dashed line is the previous hospitalization maximum.

Note that there were very few tests available in March and April, and many cases were missed, so the hospitalizations was higher relative to the 7-day average of positive tests in July. 

Now, there are many more tests, and many cases are being detected earlier - so hospitalizations have lagged.   Hospitalizations are now at a new record.

This is a new record 7-day average cases for the USA.