by Calculated Risk on 9/01/2011 10:00:00 AM

PMI was at 50.6% in August, down from 50.9% in July. The employment index was at 51.8%, down from 53.5%, and new orders increased to 49.6%, up from 49.2%.

From the Institute for Supply Management: August 2011 Manufacturing ISM Report On Business®

The report was issued today by Bradley J. Holcomb, CPSM, CPSD, chair of the Institute for Supply Management™ Manufacturing Business Survey Committee. "The PMI registered 50.6 percent, a decrease of 0.3 percentage point from July, indicating expansion in the manufacturing sector for the 25th consecutive month, at a slightly slower rate. The Production Index registered 48.6 percent, indicating contraction for the first time since May of 2009, when it registered 45 percent. The New Orders and Backlog of Orders Indexes edged up slightly from July, but both indexes are indicating contraction in August at slower rates than in July. The rate of increase in prices slowed for the fourth consecutive month, dropping another 3.5 percentage points in August to 55.5 percent. The overall sentiment is one of concern and caution over the domestic and international economic environment, which is affecting customers' confidence and willingness to place orders, at least in the short term."

Click on graph for larger image in new window.

Here is a long term graph of the ISM manufacturing index.

This was above expectations of 48.5% and suggests manufacturing expanded - slowly - in August.

The regional surveys early in August were especially weak, but the surveys towards the end of the month were a little better - suggesting the debt ceiling debate impacted consumer and business confidence early in August.

by Calculated Risk on 9/01/2011 08:30:00 AM

The DOL reports:

In the week ending August 27, the advance figure for seasonally adjusted initial claims was 409,000, a decrease of 12,000 from the previous week's revised figure of 421,000. The 4-week moving average was 410,250, an increase of 1,750 from the previous week's revised average of 408,500.

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 increased this week to 410,250.

Weekly claims declined slightly, but the 4-week average is still elevated. Next week claims will probably increase due to Hurricane Irene.

Note: The Verizon strike added to claims the previous two weeks.

by Calculated Risk on 9/01/2011 12:12:00 AM

• From the WSJ: Germany's Resiliency Buoys Europe

A pair of bullish reports, on German employment and manufacturing, were reassuring on Wednesday: Unemployment remained at its lowest level in nearly two decades last month, while July machine orders jumped 9% from a year earlier. The latest data suggest that Europe's largest economy, which is expected to grow 3% this year, remains resilient ...

• This is similar to the recession measure graphs I posted from Doug Short: Real GDP per Capita

[Doug's] preferred GDP metric is the per-capita variant. I take real GDP and divide it by the mid-month population estimates from the Census Bureau, which has reported this data from 1959 (hence my 1960 starting date). By this measure, Q2 2011 GDP is 3.4% off its peak.

Check out the 2nd graph at Doug's site.

Earlier:
• ADP: Private Employment increased 91,000 in August
• CoreLogic: Home Price Index increased 0.8% in July
• Restaurant Performance Index declined in July
• Fannie Mae and Freddie Mac Serious Delinquency Rates mostly unchanged in July

by Calculated Risk on 8/31/2011 07:22:00 PM

Update from Lawler: Yesterday I gave some stats on the "states" with the highest and lowest shares of owner-occupied homes owned free and clear. Those %'s were incorrect; they were %'s for the % of ALL occupied homes owner free and clear. (My bad).

From economist Tom Lawler:

While Census has not released “Summary File 1” for the US as a whole, it has released such data for all 50 states plus DC. As such, aggregate US data from these files, including homeownership rates by selected age groups, can be constructed using the mathematical tools called “addition” and “division.”

Note the sizable declines in homeownership rates over the last decade in the 25-54 year old age groups!

US Homeownership by Age Group (Decennial Census)
	1980	1990	2000	2010
15 to 24 years	22.1%	17.1%	17.9%	16.1%
25 to 34 years	51.6%	45.3%	45.6%	42.0%
35 to 44 years	71.2%	66.2%	66.2%	62.3%
45 to 54 years	77.0%	75.3%	74.9%	71.5%
55 to 64 years	77.6%	79.7%	79.8%	77.3%
65 years and over	70.1%	75.2%	78.1%	77.5%
Total	64.4%	64.2%	66.2%	65.1%

Here is a comparison of the decennial Census homeownership rates (which reflect April 1st) and the Housing Vacancy Survey (which are yearly average estimates). HVS data by age group only go back to 1982.

US Homeownership by Age Group (Housing Vacancy Survey)
	1980	1990	2000	2010
15 to 24 years	---	15.7%	21.7%	22.8%
25 to 34 years	---	44.2%	47.1%	44.4%
35 to 44 years	---	66.3%	67.9%	65.0%
45 to 54 years	---	75.2%	76.5%	73.5%
55 to 64 years	---	79.3%	80.3%	79.0%
65 years and over	---	76.3%	80.4%	80.5%
Total	---	63.9%	67.4%	66.9%

While the decennial Census data show that the homeownership rates for all age groups save for “geezers” in 2010 were down significantly from 1990, the HVS data do not show the same declines. Census officials are unsure of why there are such large discrepancies, but most – though not all -- feel that the decennial Census data are more accurate, and that there is “sumpin’ wrong” with the HVS data (the same is true for the HVS vacancy data), and not just for 2010, but for 2000 as well.

Some readers might be surprised at the sizable declines in the homeownership rates for younger householders from 1980 to 1990 – after all, they’ve been deluged with charts showing “aggregate” US homeownership rates over the last several years, but with little or no discussion of homeownership rates by age group. There was actually a fair amount written about the drop in younger householder homeownership rates from 1980 to 1990, with researchers attributing the decline to a number of factors – younger folks marrying later in life, job choices and labor mobility, and several other factors (I don’t plan to summarize the literature.)

Also from Tom Lawler: Number of Homes Owned Free and Clear

Here is a table derived from the decennial Census 2010 on the number of owner-occupied homes with a mortgage vs. those owned free and clear.

Owner-Occupied Homes (Census 2010)
Total	75,986,074
Owned with a mortgage or loan	52,979,430
Owned free and clear	23,006,644

Update: By state with correction:

% of OO Homes owned free and clear, 2010
US Total	30.3%
Alabama	36.6%
Alaska	31.2%
Arizona	27.9%
Arkansas	38.9%
California	22.3%
Colorado	22.3%
Connecticut	26.4%
Delaware	28.2%
District of Columbia	19.6%
Florida	33.0%
Georgia	25.6%
Hawaii	29.3%
Idaho	29.1%
Illinois	28.3%
Indiana	27.9%
Iowa	34.8%
Kansas	33.3%
Kentucky	35.9%
Louisiana	40.9%
Maine	33.5%
Maryland	21.2%
Massachusetts	25.8%
Michigan	31.3%
Minnesota	27.2%
Mississippi	41.5%
Missouri	31.5%
Montana	38.5%
Nebraska	33.7%
Nevada	21.4%
New Hampshire	27.5%
New Jersey	27.1%
New Mexico	37.7%
New York	33.0%
North Carolina	30.3%
North Dakota	42.9%
Ohio	30.0%
Oklahoma	37.7%
Oregon	28.2%
Pennsylvania	35.0%
Rhode Island	26.2%
South Carolina	33.9%
South Dakota	39.1%
Tennessee	34.1%
Texas	34.4%
Utah	23.7%
Vermont	31.9%
Virginia	25.3%
Washington	25.6%
West Virginia	47.7%
Wisconsin	30.3%
Wyoming	36.5%

CR Note: So, in 2010, about 30.3% of owner-occupied homes were owned free and clear. There will be much more on the 2010 Census data once the Summary File is released.

by Calculated Risk on 8/31/2011 04:15:00 PM

Fannie Mae reported that the Single-Family Serious Delinquency rate was unchanged at 4.08% in July. This is down from 4.82% in July of 2010. The Fannie Mae serious delinquency rate peaked in February 2010 at 5.59%.

Freddie Mac reported that the Single-Family serious delinquency rate increased to 3.51% in July from 3.50% in June. This is down from 3.89% in July 2010. Freddie's serious delinquency rate peaked in February 2010 at 4.20%.

These are loans that are "three monthly payments or more past due or in foreclosure".

Note that the Fannie and Freddie serious delinquency rates are much lower than the overall serious delinquency rate (LPS reported that the overall serious delinquency rate and in-foreclosure was 7.72% in July).

Click on graph for larger image in graph gallery.

Some of the rapid increase in 2009 was probably because of foreclosure moratoriums, and also because loans in trial mods were considered delinquent until the modifications were made permanent.

Although the delinquency rate was unchanged in July, the serious delinquency rate has been falling as Fannie and Freddie work through the backlog of delinquent loans.

The normal serious delinquency rate is under 1%, and it doesn't look like the delinquency rate will be back to "normal" for a number of years.