by Calculated Risk on 5/13/2011 04:39:00 PM

The first graph shows the rolling 12 month average of loaded inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container). Although containers tell us nothing about value, container traffic does give us an idea of the volume of goods being exported and imported - and possible hints about the trade report for April. LA area ports handle about 40% of the nation's container port traffic.

Click on graph for larger image in graph gallery.

To remove the strong seasonal component for inbound traffic, this graph shows the rolling 12 month average.

On a rolling 12 month basis, inbound traffic is up 16% and outbound up 8%.

The 2nd graph is the monthly data (with strong seasonal pattern).

For the month of April, loaded inbound traffic was up 7% compared to April 2010, and loaded outbound traffic was up 8% compared to April 2010. Even with the decline in April, exports are near the pre-recession peak.

This suggests the trade deficit with China (and other Asians countries) probably increased in April.

by Calculated Risk on 5/13/2011 01:31:00 PM

Earlier today the BLS reported:

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent in April on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 3.2 percent before seasonal adjustment.
...
The index for all items less food and energy rose 0.2 percent in April after increasing 0.1 percent in March. The shelter index, and its rent and owners' equivalent rent components, all repeated their March increases of 0.1 percent.

The Cleveland Fed released the median CPI and the trimmed-mean CPI this morning:

According to the Federal Reserve Bank of Cleveland, the median Consumer Price Index rose 0.2% (2.8% annualized rate) in April. The 16% trimmed-mean Consumer Price Index increased 0.3% (3.3% annualized rate) during the month.

Over the last 12 months, core CPI has increased 1.3%, median CPI has increased 1.4%, and trimmed-mean CPI increased 1.7%.

Note: The Cleveland Fed has a discussion of a number of measures of inflation: Measuring Inflation

Click on graph for larger image in graph gallery.

This graph shows these three measure of inflation on a year-over-year basis.

These measures all show that year-over-year inflation is still low, but increasing lately.

Note: You can see the median CPI details for April here.

Although the year-over-year increases are below the Fed's inflation target, the annualized rates were above the target in April. Core CPI increased at an annualized rate of 2.2%, median CPI 2.8% annualized, and trimmed-mean CPI increased 3.3% annualized.

However, with the slack in the system, I expect the year-over-year core measures to stay below 2% this year.

by Calculated Risk on 5/13/2011 12:47:00 PM

The preliminary May Reuters / University of Michigan consumer sentiment index increased to 72.4 from 69.8 in April.

Click on graph for larger image in graphic gallery.

This was slightly above the consensus forecast of 70.0.

In general consumer sentiment is a coincident indicator and is usually impacted by employment (and the unemployment rate) and gasoline prices.

This is still a low reading, but sentiment will probably improve later this month if gasoline prices fall.

by Calculated Risk on 5/13/2011 12:37:00 PM

A quick note ... Google's blogger has been down since yesterday afternoon.

I'll have some posts up shortly. The posts from yesterday are apparently being restored. (Yahoo mail was down too, but is back up now). The wonders of technology. Best to all

by Calculated Risk on 5/12/2011 03:54:00 PM

Mostly I focus on the housing numbers: inventory of homes for sale, homes sold, house prices, foreclosures, mortgage delinquencies, price-to-rent and price-to-income ratios and more.

Recently I've noticed a shift in sentiment - what I've been calling "hate for housing". I saw this change in sentiment during previous housing busts too, and although it doesn't mean prices have bottomed, it suggests we are getting close (the "hate" can last for a few years).

Here are two earlier posts on this shift in sentiment: Housing: Feeling the Hate and More "Hate" for Housing

And here are a couple more articles:

• From Bloomberg: Apartment Rents and Occupancies Are Poised to Rise in U.S., Economists Say

The decrease in [house] prices has turned homeownership from a source of financial security to a burden for many people, said speakers at [a conference in Vancouver].

“Now it’s the source of risk,” said Karl Case, professor emeritus of economics at Wellesley College and co-creator of the Standard & Poor’s/Case-Shiller home-price indexes.

And from David Leonhardt at the NY Times Economix: Building Wealth Through Renting

You have probably heard a version of the idea that renting a house is tantamount to flushing money down the toilet, while buying a home is building equity for your future. Well, it’s wrong, at least much of the time.

You don’t have to listen only to me on this point. Here is Jordan Rappaport, a senior economist at the Federal Reserve Bank of Kansas City, in a paper published last year:

Conventional wisdom has long suggested that homeownership is an effective way to build household wealth. Consistent with this belief, homeownership is often considered to be a key part of the American Dream ...

[Yet the] analysis in this article shows that while homeownership often builds more household wealth than renting and investing the saved cash flow, it also often does not. More specifically, for most ten-year occupancies beginning during the 1970s and 1990s, homeownership unambiguously built more wealth. In contrast, for most occupancies beginning during the 1980s, renting and investing unambiguously built more wealth. Renting and investing is also likely to build more wealth than homeownership for many of the occupancies that started in 2000 through 2009. These results suggest that either homeownership or renting and investing can be reasonable strategies for building household wealth.

In other words, the conventional wisdom that homeownership is usually the better strategy is probably too strong. For many households in many years, renting and investing the saved cash flow has built more wealth than homeownership ...

[Emphasis added.]

by Calculated Risk on 5/11/2011 04:23:00 PM

Victor Calanog, VP Research & Economics at Reis, Inc presented their quarterly briefing on commercial property sectors today. A few highlights:

• Apartments: Vacancy rates are falling and rents rising (see: Reis: Apartment Vacancy Rates fell sharply in Q1, Lowest in almost three years). Calanog expects rents to increase 4%+ in 2011 and 2012, and for the apartment vacancy rate to fall to 5.5% this year (the lowest since 2001). Note that the Reis survey is just for large cities, but this decline in vacancy rates is happening just about everywhere.

• Offices: Vacancy rates are falling and rents rising, but the recovery will be more gradual for offices than apartment. Calanog is expecting rents to rise slightly this year, and about 2.5% in 2012. He expects the vacancy rate to fall to 17.1% this year from the 17.5% in Q1 (see: Reis: Office Vacancy Rate declines slightly in Q1)

• Malls: Malls are still under pressure and Calanog expects vacancy rates at neighborhood and community shopping centers to rise slightly and rents to fall slightly this year. (see: Reis: Mall Vacancy rates increase in Q1). Reis reported that malls are seeing an echo effect from the loss of anchor tenants earlier in the cycle as smaller tenants leave malls with no anchor tenant (either by contract or when their lease expires).