Current Statistics (12-21-2008)

The Employment Picture

 

Unemployment Rate     ({6.1% Sep 2008}…{6.5% Oct})…{6.7% Nov 2008}

Nonfarm payroll employment fell sharply (-533,000) in November, and the unemployment rate rose from 6.5 to 6.7 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today.  November's drop in payroll employment followed declines of 403,000 in September and 320,000 in October, as revised.  Job losses were large and widespread across the major industry sectors in November. 


Industry Payroll Employment (Establishment Survey Data)
Total nonfarm payroll employment fell by 533,000 in November, bringing losses to 1.9 million since the start of the recession in December 2007.  Two-thirds of these losses occurred in the last 3 months.  In November, employment declined in nearly all major industries, although health care continued to add jobs.
 


Unemployment (Household Survey Data)

Both the number of unemployed persons (10.3 million) and the unemployment rate (6.7 percent) continued to increase in November.  Since the start of the recession in December 2007, as recently announced by the National Bureau of Economic Research, the number of unemployed persons increased by 2.7 million, and the unemployment rate rose by 1.7 percentage points. 

News Release - http://www.bls.gov/news.release/empsit.nr0.htm

 

The Employment Situation for December 2008 is scheduled to be released on Friday, January 9, 2009, at 8:30 A.M. (EST).

 

 

Jobless Claims   (4-wk rolling average: 526,250 Nov – 29, to 541,000 Dec – 6, to 543,750 Dec – 13)

 

In the week ending Dec. 13, the advance figure for seasonally adjusted initial claims was 554,000, a decrease of 21,000 from the previous week's revised figure of 575,000. The 4-week moving average was 543,750, an increase of 2,750 from the previous week's revised average of 541,000.

For 2001, the average weekly initial jobless claims were 405,538; in 2008 the average was 414,880. 

News Release - http://www.dol.gov/opa/media/press/eta/ui/current.htm

 

 

 

 

 

 

GDP (3rd Quarter 2008 Real GDP: -0.5%)

 

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- decreased at an annual rate of 0.5 percent in the third quarter of 2008, (that is, from the second quarter to the third quarter), according to preliminary estimates released by the Bureau of Economic Analysis.  In the second quarter, real GDP increased 2.8 percent.

 

The major contributors to the increase in real GDP in the second quarter were:

from Table 2.--Contributions to Percent Change in Real Gross Domestic Product

Personal Consumption Expenditures (PCE) -2.69% a 3.56% fall-off from the 3rd quarter
Durable Goods -1.19%
(
Motor vehicles and parts -0.82%); Nondurable Goods -1.51% (Food -0.79%) 0.92% change from 1st Quarter)

Gross private domestic investment: 0.06%
(Fixed Investment -0.82%; Change in Private Inventories 0.89%)

Net Exports (Exports – Imports): 1.07%
An increase in Exports contributed 0.46% while Imports improved, accounting for a 0.61% change.

Government Spending (Government consumption expenditures and gross investment): 1.06%

Federal increasing 0.96% and State and Local increasing by 0.10%

 

 

News Release – http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

 

 

 

 

  Leading Indicators

 

According to figures released by the Conference Board on December 18, 2008, the Conference Board announced today that the U.S. leading index decreased 0.4 percent, the coincident index decreased 0.3 percent and the lagging index increased 0.1 percent in November. 

 

The leading index now stands at 99.0 (2004=100). Based on revised data, this index decreased 0.9 percent in October and remained unchanged in September. During the six-month span through November, the leading index decreased 2.8 percent, with three out of ten components advancing (diffusion index, six-month span equals 30 percent).

 

Next release – Monday, January 26 at 10:00 AM ET

 

News Release - http://www.conference-board.org/economics/bci/pressRelease_output.cfm?cid=1

 

 

 

 

   Construction (put in place)    (October 1.2% below September)

 

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during October 2008 was estimated at a seasonally adjusted annual rate of $1,072.6 billion, 1.2 percent (±1.4%)* below the revised September estimate of $1,085.7 billion. The October figure is 4.6 percent (±1.9%) below the October 2007 estimate of $1,124.2 billion. 

 

During the first 10 months of this year, construction spending amounted to $906.3 billion, 5.7 percent (±1.4%) below the $960.9 billion for the same period in 2007.

 


Next release – November 2008 data will be released on January 5, 2009 at 10:00 A.M. EST.

 

News Release - http://www.census.gov/const/C30/release.pdf

 

 

 

 

 

      New Housing Starts    (November 18.9% below October)

 

Privately-owned housing starts in November were at a seasonally adjusted annual rate of 625,000. This is 18.9 percent (±8.9%) below the revised October estimate of 771,000 and is 47.0 percent (±5.5%) below the revised November 2007 rate of 1,179,000. 

 

Single-family housing starts in November were at a rate of 441,000; this is 16.9 percent (±8.5%) below the October figure of 531,000.  The November rate for units in buildings with five units or more was 166,000.

 

Next release (for December 2008) – Thursday January 22, 2009, at 8:30 A.M. EST

 

News Release - http://www.census.gov/const/newresconst.pdf

 

 

 

 

   New Residential Sales   (October 5.3% below September)

 

Sales of new one-family houses in October 2008 were at a seasonally adjusted annual rate of 433,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development.  This is 5.3 percent (±15.0%)* below the revised September of 457,000 and is 40.1 percent (±9.9%) below the October 2007 estimate of 723,000.

 

The median sales price of new houses sold in October 2008 was $218,000; the average sales price was $272,300. The seasonally adjusted estimate of new houses for sale at the end of October was 381,000. This represents a supply of 11.1 months at the current sales rate.

 

Next release (for November 2008) – Thursday, December 23, 2008, at 10:00 A.M. EST

 

News Release - http://www.census.gov/const/newressales.pdf

 

 

 

 

     Durable Goods (October decreased 5.1% over September)

Summary

New orders for manufactured goods in October, down three consecutive months, decreased $21.9 billion or 5.1 percent to $407.4 billion, the U.S. Census Bureau reported today. This followed a 3.1 percent September decrease.

Shipments of manufactured durable goods in October, down three consecutive months, decreased $6.2 billion or 3.0 percent to $202.1 billion, revised from the previously published 2.4 percent decrease. This followed a slight September decrease.  

Unfilled orders for manufactured durable goods in October, down for the first time in twenty-six months, decreased $5.1 billion or 0.6 percent to $823.1 billion, unchanged from the previously published decrease. This followed a 0.2 percent September increase. 

Inventories of manufactured durable goods in October, up fifteen of the last sixteen months, increased $1.5 billion or 0.4 percent to $341.3 billion, unchanged from the previously published increase. This was at the highest level since the series was first stated on a NAICS basis in 1992 and followed a 0.2 percent September increase.

Next release (the advance report on durable goods for November) –scheduled for December 24, 2008 at 8:30 a.m.

 

News Release - http://www.census.gov/indicator/www/m3/

 

Capital Goods Industries (October):

Nondefense new orders for capital goods in October decreased $2.4 billion or 3.6 percent to $65.6 billion.

Defense new orders for capital goods in October decreased $3.7 billion or 31.0 percent to $8.3 billion..

Next release (for November) –December 24, 2008 at 8:30 A.M. EDT.

 

News Release - http://www.census.gov/indicator/www/m3/adv/

 

 

              Current Account Balance (Trade Balance)

 

The Current Account Balance consists of the Trade Balance (Net Exports (Exports less Imports) of Goods and Services), the Income Balance (Income Receipts and Income Payments), and net Unilateral Current Transfers.  The Department of Commerce publishes the Current Account Balance data on quarterly basis.


The U.S. Current Account Balance 2003   – $523.4 billion

The U.S. Current Account Balance 2004   – $625.0 billion

The U.S. Current Account Balance 2005   – $729.0 billion

The U.S. Current Account Balance 2006   – $788.1 billion

The U.S. Current Account Balance 2007   – $731.2 billion

 

 

*The U.S. Trade Balance 2003   – $496.9 billion

*The U.S. Trade Balance 2004   – $607.7 billion

*The U.S. Trade Balance 2005   – $711.6 billion

*The U.S. Trade Balance 2006   – $753.3 billion

*The U.S. Trade Balance 2007   – $700.3 billion

*Balance on goods and services

 

The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that total October exports of $151.7 billion and imports of $208.9 billion resulted in a goods and services deficit of $57.2 billion, up from $56.6 billion in September, revised.  October exports were $3.4 billion less than September exports of $155.1 billion.  October imports were $2.7 billion less than September imports of $211.6 billion.

 

In October, the goods deficit increased $0.3 billion from September to $69.8 billion, and the services surplus decreased $0.4 billion to $12.6 billion.  Exports of goods decreased $3.0 billion to $104.8 billion, and imports of goods decreased $2.7 billion to $174.6 billion.  Exports of services decreased $0.3 billion to $46.9 billion, and imports of services were virtually unchanged at $34.3 billion.

 

In October 2008, the goods and services deficit increased $0.9 billion from October 2007.  Exports were up $7.6 billion, or 5.3 percent, and imports were up $8.5 billion, or 4.2 percent.

 

Next release (for November 2008) – January 11, 2009 (8:30 AM EST)

 

News Release - http://www.bea.gov/newsreleases/international/trade/tradnewsrelease.htm 

 

 

 

 


               CPI - 1.9% (November) / PPI - 2.2% (November) (Seasonally adjusted)

 

CPI – The Consumer Price Index for All Urban Consumers (CPI-U) decreased 1.9 percent in November, before seasonal adjustment, the Bureau of Labor Statistics of the U.S. Department of Labor reported today.  The November level of 212.425 (1982-84=100) was 1.1 percent higher than in November 2007.

On a seasonally adjusted basis, the CPI-U decreased 1.7 percent in November, the second consecutive record decrease.

 

The index for all items less food and energy remained the same in November 0.0 percent, following a -0.1 percent decline in October. 

 

Next release (for December 2008) – January 16, 2009 at 8:30 A.M. (EDT)

News Release - http://www.bls.gov/news.release/cpi.nr0.htm  

 

 

PPI – The Producer Price Index for Finished Goods fell 2.2 percent in November, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today.  This decline followed decreases of 2.8 percent in October and 0.4 percent in September. 

 

Among prices for finished goods, the index for energy goods fell 11.2 percent in

November following a 12.8-percent drop in the preceding month.  Prices for consumer foods were unchanged after declining 0.2 percent in October. 


Next release (for December 2008) – January 15, 2009 at 8:30 A.M. EDT

 

News Release - http://www.bls.gov/news.release/ppi.nr0.htm  

 

 

  Productivity, Compensation and Unit Labor Cost (Seasonally Adjusted)

 

The Bureau of Labor Statistics of the U.S. Department of Labor today reported revised productivity data--as measured by output per hour of all persons--for the third quarter of 2008.  The seasonally adjusted annual rates of productivity growth in the third quarter were:

1.5 percent in the business sector
1.3 percent in the nonfarm business sector
-2.7 percent in manufacturing
(2.9 percent in durable goods manufacturing, and -10.2 percent in nondurable goods manufacturing)

 

Business Sector

Business sector productivity grew at a 1.5 percent annual rate during the third quarter of 2008, less than the 1.9 percent rate of growth from the third quarter of 2007 to the third quarter of 2008 and the 2.5 percent average annual rate from 2000 to 2007.  Productivity growth in the third quarter was the result of hours worked falling faster than output. 

 

Hourly compensation in the business sector increased 4.2 percent during the third quarter of 2008, following a 1.2 percent increase in the second quarter (seasonally adjusted annual rates).

Note: Real hourly compensation fell 2.4 percent, the fourth consecutive quarter in which it declined.  This reflected the 6.7 percent increase in consumer prices during the third quarter, the fastest growth since a similar increase in the third quarter of 1990.

Unit labor costs increased 1.4 percent over the past four quarters. The change in unit labor costs approximates the change in hourly compensation less the change in productivity.

 

Nonfarm Business Sector   

Productivity in the nonfarm business sector rose at a 1.3 percent annual rate in the third quarter of 2008, slower than the 2.1 percent rate over the last four quarters, and slower than the trend rate of 2.5 percent per year from 2000 to 2007. 

Hourly compensation in the nonfarm business sector rose 4.1 percent in the third quarter of 2008. 

Note: As in the business sector, real hourly compensation decreased 2.4 percent in nonfarm business during the third quarter, due to the increase in consumer prices. 

Nonfarm business unit labor costs increased 2.8 percent in the third quarter of 2008.  Over the last four quarters unit labor costs increased 1.4 percent.  The implicit price deflator for the nonfarm business sector rose 4.9 percent in the third quarter, more than in any quarter since the third quarter of 1982 (5.0 percent).

 

Manufacturing

Manufacturing output per hour fell 2.7 percent in the third quarter of 2008, as output fell 7.8 percent and hours fell 5.3 percent.  This is the largest quarterly decline in productivity in the entire series, going back to the second quarter of 1987.  The decline in output was the largest since the first quarter of 1991, when output fell 8.0 percent.  Third quarter 2008 saw the second consecutive quarter of negative manufacturing productivity growth; revised output per hour for the second quarter of 2008 fell 2.2 percent. 

The average hourly compensation of all manufacturing workers rose 4.7 percent in the third quarter of 2008, and increased more in the durable goods sector, 6.1 percent, than in the nondurable goods sector, 2.6 percent.

Note: Hourly compensation increased 5.0 percent during the third quarter, but when consumer prices are taken into account, real hourly compensation declined 1.6 percent.  Real hourly compensation declined 1.2 percent since the third quarter of 2007. 

Unit labor costs increased 3.1 percent in durable goods industries and 14.3 percent in nondurable goods industries during the third quarter.

Next Release of Productivity and Cost is scheduled for Thursday, February 5, 2009.  Preliminary fourth-quarter and annual 2008 measures for the business, nonfarm business, and manufacturing sectors will be released at that time.

 News Release - http://www.bls.gov/news.release/prod2.nr0.htm   

 

           10-year U.S. Government Bond Rate

 

The 10-year Maturity U.S. Government Security continues to remain trading at a relatively low rate. 

 

 

 

Again…something to pay attention to here…

 

Worth another look…

 

Straight from the FED…

http://www.federalreserve.gov/pubs/arms/arms_english.htm

 

Lenders base ARM rates on a variety of indexes. Among the most common indexes are the rates on 1-year constant-maturity Treasury (CMT) securities, the Cost of Funds Index (COFI), and the London Interbank Offered Rate (LIBOR). 

 

Selected Index Rates for ARMs over an 11-Year Period - This graph shows interest rates from 1996 to 2006, including the one year London Interbank Offered Rate (from 6.2% in 1996 to 5.6% in 2006), the Eleventh District Cost of Funds Index (from 4.8% in 1996 to 4.2% in 2006), and the one year constant maturity treasury securities index (from 5.8% in 1996 to 5.2% in 2006).

 

Bear in mind that the 1-Year Constant Maturity is heavily influenced by Federal Resverve Board Open Market Committee activity. 

 

What does this mean?  If you are unfortunate enough to have been stuck holding an Adjustable Rate Mortgage (unable to refinance due to financial hardship, etc, then you’ve likely watched your mortgage interest payments rise for the past two and a half years).  The real travesty in this situation is that while the longer yield bonds have remained quite stable (note the following graph depicting the 10-year US government security, the shorter term yields have driven dramatically…and the ARMs have happily followed. 

 

Example:

If your original rate was around 4.5% and it has risen to 8.5% (not at all uncommon), then your payments have likely risen by more than 50%

 

(Based on 30-yr, $150,000 mortgage)

Monthly Cost

4.5% = $760

8.5% = $1,153

 

Yearly Cost

4.5% =   $9,120

8.5% = $13,840

 

As a percent of Income

4.5% = 19.7% of total income of $46,326

8.5% = 29.9% of total income of $46,326

 

Median Household Income 2005 = $46,326

http://www.whitehouse.gov/fsbr/income.html

 

Mortgage Status and Selected Monthly Owner Costs:  2000

http://factfinder.census.gov/servlet/QTTable?_bm=y&-geo_id=01000US&-qr_name=DEC_2000_SF3_U_QTH15&-ds_name=DEC_2000_SF3_U

  

 

New York State Controller’s Office

December 19, 2006

“Wall Street is expected to pay out $23.9 billion in bonuses in 2006, surpassing last year’s record of $20.5 billion, according to a forecast released today by State Comptroller Alan G. Hevesi.” 

http://www.osc.state.ny.us/press/releases/dec06/121906b.htm

 

Be sure to keep in mind the Fed’s continued role in pressuring up short-term interest rates when you consider the following speech pertaining to the Income Distribution…

 

“That said, we also believe that no one should be allowed to slip too far down the economic ladder, especially for reasons beyond his or her control.  Like equality of opportunity, this general principle is grounded in economic practicality as well as our sense of fairness.”

 

Remarks by Chairman Ben S. Bernanke (Chairman, Federal Reserve Board of Governors)

Before the Greater Omaha Chamber of Commerce, Omaha, Nebraska

February 6, 2007

The Level and Distribution of Economic Well-Being

http://www.federalreserve.gov/BoardDocs/Speeches/2007/20070206/default.htm

 

 

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