by Calculated Risk on 11/05/2014 12:23:00 PM

From the US Court: Fiscal Year Bankruptcy Filings Lowest in Seven Years

Bankruptcy cases filed in federal courts for the fiscal year 2014—the 12-month period ending September 30, 2014—totaled 963,739, down 13 percent from the 1.1 million bankruptcy filings in FY 2013, according to statistics released today by the Administrative Office of the U.S. Courts. This is the lowest number of bankruptcy filings for any 12-month period since 2007.

The number of filings for the fiscal year ending Sept 2014 were the lowest since 2007.

Click on graph for larger image.

This graph shows the business and non-business bankruptcy filings by year since 1987.

The sharp decline in 2006 and 2007 was due to the so-called "Bankruptcy Abuse Prevention and Consumer Protection Act of 2005". (a good example of Orwellian named legislation since this was more a "Lender Protection Act").

Other than 2007, this was the lowest level for filings since 1995. This is another indicator of an economy mostly recovered from the housing bust and financial crisis.

by Calculated Risk on 11/05/2014 10:00:00 AM

The October ISM Non-manufacturing index was at 57.1%, down from 58.6% in September. The employment index increased in October to 59.6%, up from 58.5% in September. Note: Above 50 indicates expansion, below 50 contraction.

From the Institute for Supply Management: October 2014 Non-Manufacturing ISM Report On Business®

Economic activity in the non-manufacturing sector grew in October for the 57th 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, CPSM, C.P.M., CFPM, chair of the Institute for Supply Management® (ISM®) Non-Manufacturing Business Survey Committee. "The NMI® registered 57.1 percent in October, 1.5 percentage points lower than the September reading of 58.6 percent. This represents continued growth in the non-manufacturing sector. The Non-Manufacturing Business Activity Index decreased to 60 percent, which is 2.9 percentage points lower than the September reading of 62.9 percent, reflecting growth for the 63rd consecutive month at a slower rate. The New Orders Index registered 59.1 percent, 1.9 percentage points lower than the reading of 61 percent registered in September. The Employment Index increased 1.1 percentage points to 59.6 percent from the September reading of 58.5 percent and indicates growth for the eighth consecutive month. The Prices Index decreased 3.1 percentage points from the September reading of 55.2 percent to 52.1 percent, indicating prices increased at a slower rate in October when compared to September. According to the NMI®, 16 non-manufacturing industries reported growth in October. The majority of the respondents’ comments reflect favorable business conditions; however, there is an indication that there continues to be a leveling off from the strong rate of growth of the preceding months."
emphasis added

Click on graph for larger image.

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

This was below the consensus forecast of 58.0% and suggests slightly slower expansion in October than in September.

However a reading of 57.1 still suggests solid expansion in October, and the employment index, at 59.6, was especially strong.

by Calculated Risk on 11/05/2014 08:10:00 AM

From ADP:

Private sector employment increased by 230,000 jobs from September to October according to the October ADP National Employment Report®. ... The report, which is derived from ADP’s actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis.
...
Mark Zandi, chief economist of Moody’s Analytics, said, “The job market is steadily picking up pace. Job growth is strong and broad-based across industries and company sizes. At this pace of job growth unemployment and underemployment is quickly declining. The job market will soon be tight enough to support a meaningful acceleration in wage growth.”

This was above the consensus forecast for 212,000 private sector jobs added in the ADP report. 

The BLS report for October will be released on Friday.

by Calculated Risk on 11/05/2014 07:00:00 AM

From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage applications decreased 2.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 31, 2014. ...

The Refinance Index decreased 6 percent from the previous week. The seasonally adjusted Purchase Index increased 3 percent from one week earlier.
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.17 percent from 4.13 percent, with points increasing to 0.22 from 0.21 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.


The first graph shows the refinance index.

The refinance index is down 70% from the levels in May 2013.

Even with the recent slight increase in activity - as people who purchased in the last year or so refinance - refinance activity is very low this year and 2014 will be the lowest since year 2000.


The second graph shows the MBA mortgage purchase index.  

According to the MBA, the unadjusted purchase index is down about 13% from a year ago.

by Calculated Risk on 11/04/2014 08:15:00 PM

From the WSJ: What Falling Exports Mean for U.S. Economic Growth

In response to Tuesday’s trade report (in addition to weak construction and factory orders data), economists are reducing the estimates for third-quarter real GDP growth. Economists at BNP Paribas now track third-quarter GDP at 2.8% and J.P. Morgan forecasters think the rate will be revised to 2.9%, while the econ shops at Goldman Sachs, Royal Bank of Scotland and Capital Economics think the rate will fall to about 3%.

The BEA will release the 2nd revision of GDP on November 25th, but so far it looks like GDP will be revised down.

Wednesday:
• At 7:00 AM ET, the Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

• At 8:15 AM, the ADP Employment Report for October. This report is for private payrolls only (no government). The consensus is for 212,000 payroll jobs added in October, down from 213,000 in September.

• At 10:00 AM, the ISM non-Manufacturing Index for October. The consensus is for a reading of 58.0, down from 58.6 in September. Note: Above 50 indicates expansion.