by Calculated Risk on 10/05/2011 10:00:00 AM

The September ISM Non-manufacturing index was at 53.0%, down from 53.3% in August. The employment index decreased in September to 48.7%, down from 51.6% in August. Note: Above 50 indicates expansion, below 50 contraction.

From the Institute for Supply Management: September 2011 Non-Manufacturing ISM Report On Business®

Economic activity in the non-manufacturing sector grew in September for the 22nd consecutive month, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM Report On Business®.

The report was issued today by Anthony Nieves, C.P.M., CFPM, chair of the Institute for Supply Management™ Non-Manufacturing Business Survey Committee. "The NMI registered 53 percent in September, 0.3 percentage point lower than the 53.3 percent registered in August, and indicating continued growth at a slightly slower rate in the non-manufacturing sector. The Non-Manufacturing Business Activity Index increased 1.5 percentage points to 57.1 percent, reflecting growth for the 26th consecutive month. The New Orders Index increased by 3.7 percentage points to 56.5 percent. The Employment Index decreased 2.9 percentage points to 48.7 percent, indicating contraction in employment after 12 consecutive months of growth. The Prices Index decreased 2.3 percentage points to 61.9 percent, indicating prices increased at a slower rate in September when compared to August. According to the NMI, nine non-manufacturing industries reported growth in September. Respondents' comments reflect an uncertainty about future business conditions and the direction of the economy."
emphasis added

Click on graph for larger image in graph gallery.

This graph shows the ISM non-manufacturing index (started in January 2008) and the ISM non-manufacturing employment diffusion index.

This was slightly above the consensus forecast of 52.9% and indicates slightly slower expansion in September than in August. However the employment index indicated contraction in September.

by Calculated Risk on 10/05/2011 08:15:00 AM

ADP reports:

According to today’s ADP National Employment Report, employment in the nonfarm private business sector rose 91,000 from August to September on a seasonally adjusted basis. Employment in the private, service-providing sector rose 90,000 in September, up slightly from an increase of 83,000 in August. Employment in the private, goods-producing sector rose a scant 1,000 in September, while manufacturing employment declined by 5,000.

“Like August, this month’s jobs report continues to show modest job creation,” said Gary C. Butler, Chief Executive Officer of ADP. “The number of jobs added to the private sector in August and September were virtually identical."

Note: ADP is private nonfarm employment only (no government jobs).

This was slightly above the consensus forecast of an increase of 90,000 private sector jobs in September. The BLS reports on Friday, and the consensus is for an increase of 65,000 payroll jobs in September, on a seasonally adjusted (SA) basis.

Of course the ADP report has not been very useful in predicting the BLS report.

by Calculated Risk on 10/05/2011 07:17:00 AM

The MBA reports: Mortgage Applications, except Government Refinances, Decrease in Latest MBA Weekly Survey

Refinance Index decreased 5.2 percent from the previous week. The seasonally adjusted Purchase Index decreased 0.8 percent from one week earlier.
...
"Interest rates continued to fall last week, driven by the latest Federal Reserve actions to invest in longer-term Treasury and mortgage securities, but potential borrowers largely remained on the sidelines, seemingly unimpressed by the lowest (by any measure) mortgage rates since the 1940s," said Mike Fratantoni, MBA's Vice President of Research and Economics. "Refinance application volume declined and purchase volume was little changed. ... Many refinance borrowers are opting to deleverage by moving to a 15-year term, with this product accounting for 27.0 percent of refinance volume last week."
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 4.18 percent from 4.24 percent ... The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 4.49 percent from 4.53 percent

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

Click on graph for larger image in graph gallery.

The purchase index declined in August - although this doesn't include the large number of cash buyers - this suggests fairly weak home sales this fall.

by Calculated Risk on 10/05/2011 12:05:00 AM

From the WSJ: Offices Make Slow Recovery

Overall, the amount of occupied space in U.S. office buildings increased by 6.2 million square feet during the quarter, with the vacancy rate falling by 0.1 percentage point to 17.4%, Reis said.
...
Average asking rents for office space also have been growing slowly this year and rose by 13 cents to $27.85 a square foot in the third quarter. By comparison, they hit a boom-era high of $29.37 in the third quarter of 2008 and a post-recession low of $27.50 in the third quarter of 2010.

Click on graph for larger image in graph gallery.

This graph shows the office vacancy rate starting in 1991.

Reis is reporting the vacancy rate declined to 17.4% in Q3, down from 17.5% in Q2. The vacancy rate was at a cycle high of 17.6% in Q3 2010. It appears the office vacancy rate might have peaked in 2010 - and has only declined slightly since then.

Reis should release the Mall and Apartment vacancy rates over the next few days.

by Calculated Risk on 10/04/2011 06:50:00 PM

From the American Bankruptcy Institute: Consumer Bankruptcy Filings Down 10 Percent Through Nine Months of 2011

U.S. consumer bankruptcy filings totaled 1,044,722 nationwide during the first nine months of 2011 (Jan. 1-Sept. 30), a 10 percent decrease from the 1,165,172 total consumer filings during the same period a year ago, according to the American Bankruptcy Institute (ABI), relying on data from the National Bankruptcy Research Center (NBKRC). September consumer bankruptcies decreased 17 percent nationwide from September 2010 as the data showed that the overall consumer filing total for September reached 108,517 down from the 130,329 consumer filings recorded in September 2010.

“The trend of declining filings has been consistent with consumers continuing to reign in their spending, household debt, and an overall pull back in consumer credit,” said ABI Executive Director Samuel J. Gerdano. “Total consumer filings for 2011 will be less than 2010.”

Click on graph for larger image in graph gallery.

This graph shows the non-business bankruptcy filings by quarter using monthly data from the ABI and previous quarterly data from USCourts.gov.

Note: The spike in 2005 was due to the so-called "Bankruptcy Abuse Prevention and Consumer Protection Act of 2005".

It is possible that consumer bankruptcy filings peaked in 2010, but filings will probably stay elevated for several years.