by Calculated Risk on 8/04/2011 10:53:00 AM

From the National Multi Housing Council (NMHC): Apartment Sector Continues Across-the-Board Improvement, NMHC Market Conditions Survey Finds

The Market Tightness Index, which examines vacancies and rents, came in at 82, down from a record 90. This is the sixth straight quarter the index has topped 50. Though down slightly from last quarter’s record level, two-thirds of respondents noted tighter markets (lower vacancies and/or higher rents) compared with three months earlier.
...
“Demand for apartment residences continues to rise, even as the overall economy remains hampered by the aftermath of the housing bubble,” said NMHC Chief Economist Mark Obrinsky. “For the fifth time in the last six quarters, all four survey measures of market health showed improvement over the prior three months. Markets are tighter, debt and equity capital are more available and sales volume is rising.”

Click on graph for larger image in graph gallery.

This graph shows the quarterly Apartment Tightness Index.

The index has indicated tighter market conditions for the last six quarters and although down from the record 90 in April - a reading of 82 is still very strong. A reading above 50 suggests the vacancy rate is falling and / or rents are rising. This data is a survey of large apartment owners only.

This fits with the recent Reis data showing apartment vacancy rates fell in Q2 2011 to 6.0%, down from 6.2% in Q1 2011, and 7.8% in the Q2 2010.

New multi-family construction is one of the few bright spots for the U.S. economy and this survey indicates demand for apartments is still strong.

A final note: This index helped me call the bottom for effective rents (and the top for vacancy rate) over a year ago.

by Calculated Risk on 8/04/2011 08:30:00 AM

The DOL reports:

in In the week ending July 30, the advance figure for seasonally adjusted initial claims was 400,000, a decrease of 1,000 from the previous week's revised figure of 401,000 [from 398,000]. The 4-week moving average was 407,750, a decrease of 6,750 from the previous week's revised average of 414,500.

The following graph shows the 4-week moving average of weekly claims since January 2000 (longer term graph in graph gallery).

Click on graph for larger image in graph gallery.

The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims decreased this week to 407,750.

The 4-week average is still elevated, but has been moving down since mid-May. This is the lowest level for the 4-week average since early April.

by Calculated Risk on 8/03/2011 09:22:00 PM

Also from CNBC: Japan Intervenes in FX Markets, Dollar Jumps Versus Yen; Finance Minister Holding Emergency Press Conference

From Floyd Norris at the NY Times: The Truth About Fundamentals

Herewith I offer a fundamental law about fundamentals:

If a government feels a need to proclaim that its economic fundamentals are strong, they are not.

And then he quotes Italian Prime Minister Silvio Berlusconi:

“Our economy is healthy. The country is economically and financially solid.”

Of course some people will also point to this comment by White House Spokesman Jay Carney today:

“We do not believe that there is a threat of a double-dip recession.”

I don't think there will be a double-dip in the U.S., but as Paul Krugman noted there is definitely a threat.

Back to Europe. As bond values fall, banks in Italy and Spain that hold many of their home country's bonds, are having funding problems. They are having to turn to the ECB for funding. Another key point from the NY Times: Europe’s Banks Struggle With Weak Bonds

[T]he European Financial Stability Fund, Europe’s so-called bazooka rescue fund that it endowed last month with the powers to recapitalize weak banks, will not be able to offer any such aid for at least two months.

According to a stability fund official, staff members there are working night and day to recast the entity, but do not expect to be finished until the end of August. At that point, it must be approved by the parliaments of the 17 countries that use the euro currency.

The markets may not wait.

Here is a graph of the 10 year spread (Italy to Germany) from Bloomberg. And for Spain to Germany. Although the spreads eased slightly today, if the spreads increase much more, Italy and Spain might be knocking on the bailout door.

Earlier:
• ADP: Private Employment increased 114,000 in July
• ISM Non-Manufacturing Index indicates slower expansion in July
• CoreLogic: Home Price Index increased 0.7% in June

by Calculated Risk on 8/03/2011 06:52:00 PM

On graphs: All graphs are free to use - all I ask is credit and a link for online sites, and a mention of http://www.calculatedriskblog.com/ in printed material.

To obtain a large graph, use the Graph Gallery - select a graph (tabs at the top are for the various galleries) and click on "Print" in the lower left.

Data Sources: Enjoy!

I'm frequently asked for sources of data, so here is an updated list ranking economic data. For each indicator I've included a link to the source, and a link to the current graph gallery.

These lists are not exhaustive, and the rankings are not static. As an example, right now initial weekly unemployment claims is ‘B List’ data, but when (if) the expansion takes hold, weekly claims will move unceremoniously to the 'D List'.

I've marked several indicators with '***' indicating I think this data is currently more important than usual. This includes weekly claims and several real estate related releases (delinquency reports, negative equity, vacancy rates).

Some of the lower ranked data is useful as leading indicators. As an example, the Architecture Billings Index is a leading indicator for investment in commercial real estate. And the NMHC apartment survey leads changes in apartment rents and vacancy rates. Also some of the lower ranked data helps forecast some of the more important data.

Note: There has been some research (by Wall Street analysts) about how "surprises" for many of these indicators impact the stock market. In general the ranking is similar to this list, with the employment situation report being #1. Surprisingly (at least to me) investors tend to react more to "surprises" for existing home sales than new home sales, even though the later is far more important from an economic perspective.

A-List
• BLS: Employment Situation Report (Employment Graphs)
• BEA: GDP Report (quarterly) (GDP Graphs)

B-List
• Census: New Home Sales (New Home Graphs)
• Census: Housing Starts (Housing Graphs)
• ISM Manufacturing Index (ISM Graph)
• Census: Retail Sales (Retail Graphs)
• BEA: Personal Income and Outlays (graph)
• Fed: Industrial Production (graphs IP and Capacity Utilization)
• BLS: Core CPI (graph CPI)
• ***DOL: Weekly Initial Unemployment Claims (graph weekly claims)

C-List
• Philly Fed Index (Graph Philly Fed)
• NY Fed Empire State Manufacturing Index (Graph Empire Index)
• Chicago ISM: Chicago PMI
• Census: Durable Goods
• ISM Non-Manufacturing Index (Graphs)
• House Prices: Case-Shiller and CoreLogic (House Price Graphs)
• NAR: Existing Home Sales (Graphs Existing Home)
• NAHB: Housing Market Index (Graph NAHB HMI)
• Census: Trade Balance (Graph Trade Balance)
• ***MBA: Mortgage Delinquency Data (Quarterly) (Graph MBA delinquency)
• ***LPS: Mortgage Delinquency Data (Graphs LPS Delinquency)
• ***CoreLogic: Negative Equity Report (quarterly) (Graphs Negative Equity)
• ***AIA: Architecture Billings Index (Graph ABI)
• ***Reis: Office, Mall, Apartment Vacancy Rates (Quarterly) (Graphs REIS Vacancy Rate)
• ***NMHC Apartment Survey (Quarterly) (Graph NMHC Survey)

D-List
• Reuters / Univ. of Michigan Consumer Confidence Index (Graph Consumer Confidence)
• MBA: Mortgage Purchase Applications Index (Graph MBA Index)
• BLS: Job Openings and Labor Turnover Survey (Graph JOLTS)
• Census: Construction Spending (Graph Construction Spending)
• ¹Census: Housing Vacancy Survey (Quarterly) (Graphs Homeownerhip, Vacancy Rates)
• Fed: Senior Loan Officer Survey (Quarterly)
• AAR: Rail Traffic (Graph Transportation)
• ATA: Trucking (Graph Transportation)
• Ceridian-UCLA: Diesel Fuel Index (Graph Transportation)
• NFIB: Small Business Survey (Graphs NFIB Survey)
• Fed: Flow of Funds (Quarterly) (Graph Household Net Worth)
• STR: Hotel Occupancy (Graph Hotel Occupancy)
• CRE Prices: CoStar, Moody’s (Graphs)
• Manufacturers: Light Vehicle Sales (Graph Vehicle Sales)
• NRA: Restaurant Performance Index (Graph)
• Fed: Consumer Credit
• DOT: Vehicle Miles Driven (Graph Miles Driven)
• LA Port Traffic (Graph Port Traffic)
• BLS: Producer Price Index
• ADP Employment Report
• Conference Board Confidence Index
• NAR: Pending Home Sales
• Census: State Unemployment Rates, (graph)

¹: There are questions about the accuracy of the HVS.

Sources (Government):
BEA: Bureau of Economic Analysis
BLS: Bureau of Labor Statistics
Census: Census Bureau
DOL: Dept of Labor
DOT: Dept. of Transportation
Fed: Federal Reserve

Sources (Industry):
AAR: Association of American Railroads
AIA: American Institute of Architects
ISM: Institute for Supply Management
LPS: Lender Processing Services
MBA: Mortgage Bankers Association
NAHB: National Association of Homebuilders
NAR: National Association of Realtors
NFIB: National Federation of Independent Business
NRA: National Restaurant Association
STR: Smith Travel Research

by Calculated Risk on 8/03/2011 03:14:00 PM

Here is a depressing report from the National Employment Law Project: States Made Unprecedented Cuts to Unemployment Insurance in 2011

NELP’s new analysis shows that in 2011, six states cut the maximum number of weeks that jobless workers can receive unemployment insurance to less than 26 weeks—a threshold that had served as a standard for all 50 states for more than half a century, until this year. Michigan, Missouri, and South Carolina cut their available weeks down to 20; Arkansas and Illinois cut down to 25; and Florida cut to between 12 and 23 weeks, depending on the state’s unemployment rate. Double-digit unemployment in Michigan, South Carolina, and Florida did not discourage lawmakers there from making the cuts.

... Indiana changed the formula it uses to calculate weekly benefit amounts so that the average unemployment check will drop from $283 to $220 a week.

Ouch.

More from the report:

Throughout the recession, states with inadequate unemployment insurance trust fund reserves have relied on loans from the federal government to pay state unemployment insurance benefits. This September, states will begin paying interest on these loans, and starting in 2012, the federal government will raise taxes on employers in borrowing states until loans are paid in full, as required by the law.