by Calculated Risk on 3/22/2011 02:08:00 PM

Moody's reported today that the Moody’s/REAL All Property Type Aggregate Index declined 1.2% in January. Note: Moody's CRE price index is a repeat sales index like Case-Shiller - but there are far fewer commercial sales and there are a large percentage of distressed sales - and that can impact prices and make the index very volatile.

Below is a comparison of the Moodys/REAL Commercial Property Price Index (CPPI) and the Case-Shiller composite 20 index. Beware of the "Real" in the title - this index is not inflation adjusted.

Click on graph for larger image in graph gallery.

CRE prices only go back to December 2000. The Case-Shiller Composite 20 residential index is in blue (with Dec 2000 set to 1.0 to line up the indexes).

According to Moody's, CRE prices are down 4.3% from a year ago and down about 43% from the peak in 2007.

by Calculated Risk on 3/22/2011 12:06:00 PM

This is one of several transportation indexes I follow ...

From the American Trucking Association: ATA Truck Tonnage Index Fell 2.9% in February

The American Trucking Associations’ advance seasonally adjusted (SA) For-Hire Truck Tonnage Index decreased 2.9% in February after increasing a revised 3.5% in January 2011. ... In January, the SA index equaled 116.6. During December 2010 and January 2011, the SA tonnage index jumped a total of 6.1%.
...
ATA Chief Economist Bob Costello said that the winter storms in February probably played a role in the latest reduction and that he wasn’t concerned about the decrease. “Tonnage is not going to increase every month and in general I’m very pleased with freight volumes early this year.” Costello also stated that the anecdotal reports from motor carriers are very encouraging. “I’m hearing a significant amount of positive news from fleets and that the largest concern continues to be the price of diesel fuel, not freight levels.”
...
Trucking serves as a barometer of the U.S. economy, representing 68% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods.

Click on map for graph gallery.

This graph from the ATA shows the Truck Tonnage Index since Jan 2007.

This decline followed two sharp increases, so it isn't that concerning. The largest concern for truckers is oil prices, not freight levels - and high oil prices are a key risk for the economy, especially with gasoline prices hitting $4 per gallon in some areas.

by Calculated Risk on 3/22/2011 10:08:00 AM

From the Richmond Fed: Manufacturing Activity Continues to Advance in March; Expectations Remain Upbeat

In March, the seasonally adjusted composite index of manufacturing activity — our broadest measure of manufacturing — fell five points to 20 from February's reading of 25. Among the index's components, shipments decreased six points to 23, new orders dropped seven points to finish at 20, while the jobs index held firm at 16. [above indicates expansion]
...
Hiring conditions continued to firm at Fifth District plants in March. The manufacturing employment index held steady at 16, while the average workweek measure moved down seven points to 10. In contrast, wage growth edged up one point to 19.

This was slightly below the consensus forecast of 24, but still shows solid expansion. Prices remain a concern.

• Also, the FHFA reported U.S. Monthly House Price Index Declined 0.3 Percent from December to January. This is for GSE loans and is not as closely followed as Case-Shiller or CoreLogic. According to the FHFA, house prices are at a new post-bubble low and the "January 2011 index is roughly the same as the May 2004 index level."

by Calculated Risk on 3/22/2011 09:16:00 AM

As Letterman said last night "What are we supposed to pay attention to, Libya or Japan?” (ht Brian)

We could add Yemen, Bahrain, Saudi Arabia and more to Letterman's list (maybe he should do a top ten world problems - but unfortunately it would be serious).

The 27 EU leaders meet on Thursday and Friday. In advance of that meeting, the Finance Ministers have reached agreement on the permanent bailout fund, from Reuters: EU finance ministers agree on capital, ESM loan pricing

The euro zone's permanent bailout fund, the European Stability Mechanism ... which will have an effective lending capacity of 500 billion euros, will be backed by 80 billion euros of paid-in capital and 620 billion euros of callable capital ... It will offer loans at funding costs plus 200 basis points for loans up to three years and plus another 100 basis points for loans longer than three years.

The temporary EFSF has a 300 basis points margin and a 50bp fee.

Here are the 2 year bond yields from Bloomberg for Ireland (over 10%!), Portugal, and Greece. And here are the ten year yields for Greece, Ireland, Spain, and Belgium. The focus will be on Ireland and Portugal at the meetings this week.

by Calculated Risk on 3/21/2011 11:14:00 PM

From Eric Wolff at the North County Times: Analysts see gas headed back to $4 a gallon

The average gas price may reach $4 a gallon by Thursday in San Diego County, and Riverside-San Bernardino counties won't be far behind, gasoline analysts said.

The average price Monday for a gallon of regular unleaded was $3.955 in Riverside and San Bernardino counties and $3.977 in San Diego County, according to AAA. Both prices exceeded the price of gas at this point in 2008, when gas prices peaked in June at $4.63.

California has higher gasoline prices than most of the U.S. - and San Diego is usually near the top in California - but prices are moving higher for everyone (although still below $4 per gallon for most).

Last week, Jim Hamilton had a post on consumer sentiment and gasoline prices, including a graph on prices across the country. Note: The final March Reuter's/University of Michigan's Consumer sentiment index will be released on Friday.

Earlier:
• February Existing Home Sales: 4.88 million SAAR, 8.6 months of supply
• Existing Home Inventory decreases 1.2% Year over Year
• Existing Home Sales and Inventory Graphs

by Calculated Risk on 3/21/2011 06:08:00 PM

A couple of stories ...
• From Treasury: Treasury to Begin Orderly Wind Down of Its $142 Billion Mortgage-Backed Securities Portfolio

Today, the U.S. Department of the Treasury announced that it will begin the orderly wind down of its remaining portfolio of $142 billion in agency-guaranteed mortgage-backed securities (MBS). Starting this month, Treasury plans to sell up to $10 billion in agency-guaranteed MBS per month, subject to market conditions.

“We’re continuing to wind down the emergency programs that were put in place in 2008 and 2009 to help restore market stability, and the sale of these securities is consistent with that effort,” said Mary J. Miller, Assistant Secretary for Financial Markets.

I don't think this will have much impact on mortgage rates.

• From Bloomberg: Fed Must Release Data on Emergency Bank Loans as High Court Rejects Appeal

The Federal Reserve will disclose details of emergency loans it made to banks in 2008, after the U.S. Supreme Court rejected an industry appeal that aimed to shield the records from public view.

The justices today left intact a court order that gives the Fed five days to release the records, sought by Bloomberg News’s parent company, Bloomberg LP

There was probably heavy borrowing by - shock - Citi, BofA and most other big banks. This ruling is for discount window lending, and the Dodd-Frank bill required the Fed to disclose this information with a two year lag - so I'm not sure why the Fed objected. The Fed has already released data on the emergency Credit and Liquidity Facilities. There were no surprises. I support transparency, but I doubt there will be any surprises with the discount window data either.