- US Industrial Production -

Transcription

1 4 - US Industrial Production - Figure 1. INDUSTRIAL PRODUCTION INDEXES (1992=1) 12 3 Business Week s Production Index* Fed s Industrial Production Index: All Industries 1 12/ ary durable goods orders led by 145% surge in the volatile aircraft category * Four-week average. Includes auto, truck, coal, lumber, electric power, rail-freight traffic, crude oil refining, and steel production. Source: Board of Governors of the Federal Reserve System and "Business Week," McGraw-Hill, Inc. 4 Figure 2. INDUSTRIAL PRODUCTION & NEW ORDERS Business Week s Production Index* (1992=1) New Orders: Durable Goods (billions of dollars, sa) 12/ * Four-week average. Includes auto, truck, coal, lumber, electric power, rail-freight traffic, crude oil refining and steel production. Page 4 / March 15, 1999 / Economic Scoreboard www.

2 Figure 3. - Capacity Utilization - Our Boom-Bust Barometer is up for the fifth straight week as jobless claims drop below 3,. Industrial commodity prices remain extremely weak. 1 Figure 4. CAPACITY UTILIZATION & T-BILL RATE Three Month T-Bill Rate (yearly change) 9 T-bill rate remains below a year ago. Capacity utilization rate at cycle low and falling. 5 Capacity Utilization Rate: Total 8 12/ Page 5 / March 15, 1999 / Economic Scoreboard www.

3 - Energy Usage - 21 Figure 5. U.S. PETROLEUM USAGE & INDUSTRIAL OUTPUT (million barrels per day, 52-week ma) Total Petroleum Usage 1/ Industrial Production (22=1) Petroleum usage flattening out, coinciding with slowdown in industrial output. Gasoline usage remains on uptrend Source: U.S. Department of Energy and Board of Governors of the Federal Reserve System. Figure 6. US GASOLINE USAGE & INDUSTRIAL OUTPUT (million barrels per day, 52-week ma) 1/ Industrial Production (1992=1) Source: US Department of Energy, Energy Information Administration. Page 6 / March 15, 1999 / Economic Scoreboard www.

4 37 35 Figure 7. - Commodities - CRB RAW INDUSTRIALS SPOT PRICE INDEX* (1967=1) 37 12/27 35 CRB raw industrials spot price index in free-fall--about to drop into "global recession zone"! global boom global growth recession zone < GDP < global recession zone -2 < GDP < * Includes copper scrap, lead scrap, steel scrap, tin, zinc, burlap, cotton, print cloth, wool tops, hides, rosin, rubber, and tallow. Source: The Commodity Research Bureau. Figure 8. Widespread weakness. Page 7 / March 15, 1999 / Economic Scoreboard www.

5 11 9 Figure 9. WEEKLY PROFITS PROXY (yearly percent change) - Profits - Weekly Profits Proxy* S&P 5 Reported Earnings Per Share / Profits recession. Our Weekly Profits Proxy falling at a 7% clip over the past year, reflecting weak pricing environment. Price component continues to fall at a double-digit pace. Output component growing in flat trend around 4% * Business Week s industrial production index multiplied by CRB raw industrials spot price index. Figure 1. WEEKLY PROFITS PROXY COMPONENTS (yearly percent change) Units* Prices** / * Business Week s industrial production index. ** CRB raw industrials spot price index. Page 8 / March 15, 1999 / Economic Scoreboard www.

6 Figure Inventories - Recent movements in short-term business borrowings likely related to credit conditions in global bond markets rather than movements in US business inventories. Growth in inventory investment has been fairly stable in recent months. ***** Chart Not Available ***** Task: SBWCIMTI Invalid calculation element [NFC@PCMLL] :24:55 Jobless claims fell 5, last week to 293,. The four-week average dropped to 292,5--the lowest since February 1989! Low claims level consistent with record low inventories-to-sales ratio Figure 12. INVENTORIES & UNEMPLOYMENT CLAIMS Manufacturing & Trade Inventories-To-Sales Ratio Initial Unemployment Claims (4-week average, thousands, sa) / Page 9 / March 15, 1999 / Economic Scoreboard www.

7 Figure Employment - Labor indicators remain strong as 1999 begins. Jobless claims at decade-low. Conference Board s "jobs plentiful" series at record high, predicting continued strong gains in payroll employment. Figure 14. Page 1 / March 15, 1999 / Economic Scoreboard www.

8 14 13 Figure 15. UNEMPLOYMENT RATES - Consumer The rate of insured unemployment unchanged at 1.9%, remaining near record low 1.8%. Civilian jobless rate at 28-year low of 4.3%. Drop in Conference Board s "jobs hard to get" series suggests still lower unemployment rate State-Insured Unemployment Rate* Median Unemployment Duration In Weeks Civilian Unemployment Rate / * Unemployment rate for persons covered by state unemployment insurance programs. All confidence measures remain near record levels. Consumer optimism and healthy jobs growth predicting strong consumer spending through the first half of the year Figure 16. CONSUMER CONFIDENCE Money/ABC News Consumer Comfort Index Conference Board: Present Situation Index / Page 11 / March 15, 1999 / Economic Scoreboard www.

9 Yearly growth rate in weekly personal loans data predicting further pick up in pace of consumer borrowing Consumer & Mortgage Credit - Figure 17. CONSUMER CREDIT Personal Loans At All Banks* (52-week percent change) Consumer Credit** (12-month percent change) / * Source: Federal Reserve G.19 release Figure 18. REAL ESTATE LOANS (yearly percent change) /27 Growth rate in real estate loans at banks looking toppy despite boom in housing activity. Bankers are probably securitizing mortgages they make and mortgage bankers may be gaining market share At All Banks Page 12 / March 15, 1999 / Economic Scoreboard www.

10 New Purchase Index breaks lower. Refinancing Index continues to fall Consumer & Mortgage Credit - Figure 19. MORTGAGE APPLICATIONS: NEW PURCHASE INDEX (four-week mvoing average, sa) Source: Mortgage Bankers Association. Figure 2. MORTGAGE APPLICATIONS (March 16, 199=1) / Refinancing Index Four-week moving average Weekly Data / / * Source: Mortgage Bankers Association. Page 13 / March 15, 1999 / Economic Scoreboard www.

11 - G7 Industrial Production - Figure 21. ***** Chart Not Available ***** Task: SBG7CRB KEEP command attempted on missing data :24:52 Industrial commodity prices falling at fast clip, predicting weaker production in both G7 and non-g7 economies. Growth in G7 industrial production approaching zero. Figure 22. ***** Chart Not Available ***** Task: SBG7MET KEEP command attempted on missing data :16:6 Page 14 / March 15, 1999 / Economic Scoreboard www.

12 - G7 Industrial Production Figure 23. YIELD CURVE & PRODUCTION Yield Curve* (52-weeks ahead) Industrial Production (yearly percent change) / Flattish global yield curves forecasting slower global growth in * 1-year government bond yield minus 3-month Treasury bill. Figure Page 15 / March 15, 1999 / Economic Scoreboard www.

13 Figure G7 Interest Rates - US money rates looking toppy. G4 rates falling. Figure 26. Temporary backup in global bond yields. Fundamentals remain bullish. Global deflationary pressures should push yields lower. Page 16 / March 15, 1999 / Economic Scoreboard www.

14 Short-term interest rates flat to down in most industrial economies. UK rates down sharply G7 Interest Rates - Figure 27. THREE-MONTH EURO RATES Canada Japan UK Germany / / /27 Global bond yields remain on steep downtrends--except in Japan. However, Japan s Ministry of Finance recently announced measures to curb the rise in long-term bond yields Figure 28. GOVERNMENT BOND YIELDS* Canada Japan UK Germany 12/ * 1-year maturities Page 17 / March 15, 1999 / Economic Scoreboard www.

15 Figure Stock Prices - Global stock markets hovering at or near record highs Figure 3. S&P 5 INDEX (Wednesday closing price, ratio scale) 15 12/ Page 18 / March 15, 1999 / Economic Scoreboard www.

16 Figure Stock Prices - Ditto. Figure 32. Stock markets in this region vulnerable given severe recessions in several economies. Page 19 / March 15, 1999 / Economic Scoreboard www.

17 There s still plenty of liquidity. M3 exceeds $6 trillion Figure 33. M3 & WEEKLY LIQUID ASSETS COUNTER (trillion dollars, sa) Liquidity - MONEY MARKET MUTUAL FUNDS / /13 3/ M WLAC* * Sum of other checkable deposits, total savings deposits, money market deposit accounts, money market mutual funds, and small and large time deposits. Central bank holdings of US Treasury securities looking toppy after turning up recently Figure 34. FOREIGN OFFICIAL DOLLAR RESERVES (Monthly) (billion dollars, nsa) FRODOR US Treasuries US Treasuries Plus US Federal Agency Securities US Federal Agency Securities Source: Board of Governors of the Federal Reserve System. Jul Jul Jul Information herein is believed to be reliable and has been obtained from sources believed to be reliable, but its accuracy and completeness cannot be guaranteed. Opinions, estimates, and projections constitute our judgement and are subject to change without notice. This publication is provided to you for information purposes only and is not intended as an offer or solicitation for the sale of any financial instrument. Oak Associates, ltd. may hold a position in the financial instruments of any issuer discussed herein or act as advisor or lender to such issuer. Transaction should be executed through a Deutsche Bank entity in the client s home jurisdiction unless otherwise permitted by law. Oak Associates, ltd. Copyright 211 Oak Associates, ltd.