{"id":1441,"date":"2019-01-22T13:39:13","date_gmt":"2019-01-22T18:39:13","guid":{"rendered":"http:\/\/naroffeconomics.com\/?p=1441"},"modified":"2019-01-22T13:39:15","modified_gmt":"2019-01-22T18:39:15","slug":"december-existing-home-sales-and-january-philadelphia-fed-nonmanufacturing-survey-2","status":"publish","type":"post","link":"https:\/\/naroffeconomics.com\/?p=1441","title":{"rendered":"December Existing Home Sales and January Philadelphia Fed NonManufacturing Survey"},"content":{"rendered":"\n

KEY DATA:<\/strong> Sales (Month): -5.5%;\nOver-Year: -10.1%; Prices (Over-Year): +2.9%\/ Phila Fed (Nonman.): -6.7 points;\nNew Orders: -20.6 points; Expectations: -15.6 points<\/p>\n\n\n\n

IN A\nNUTSHELL:<\/strong>  \u00e2\u20ac\u0153The manufacturing sector may be holding up\nbut the rest of the economy, especially housing, isn\u00e2\u20ac\u2122t.\u00e2\u20ac\u009d<\/em><\/strong><\/p>\n\n\n\n

WHAT IT\nMEANS:<\/strong>  While the shutdown continues, the economy is\nbeing battered.  The latest ugly numbers\nshow issues in housing and the non-manufacturing portion of the economy.  The National Association of Realtors reported\nthat sales plummeted in December.  The\ndrop in demand was seen in three of the four major regions, with only the West\nposted a gain.<\/em><\/strong>  For all of 2018,\nsales fell by 3.1% compared to 2017.   Every\nregion declined, led by a sharp drop n the West.  The rate of price increases continues to\ndecelerate, though when you look at the year as a total, prices were still up\nsolidly (6.1%).   <\/em><\/strong><\/p>\n\n\n\n

While manufacturing in the Philadelphia Fed\u00e2\u20ac\u2122s region\npicked up a touch in January, the rest of the economy continued to fade.  The nonmanufacturing index is now showing\nalmost no growth after plummeting sharply in December and faltering further in\nJanuary. <\/em><\/strong> New orders, which had been surging as\nrecently as November, are now flat.<\/em><\/strong> \nHiring, while still occurring, has softened significantly for both full\ntime and part time workers.  And\ncompounding the problems, costs are rising faster.  All of these issues are not playing well with\nowners and their optimism about the next six months has been shaken\ngreatly.  <\/p>\n\n\n\n

MARKETS AND\nFED POLICY IMPLICATIONS:<\/em><\/strong>  The economy is slowing, which most economists\nexpected.  But the coming down off the\nsugar high is being compounded by the government shutdown and the trade\ndisagreements and that is causing growth in other countries, not just China, to\nmoderate as well.<\/em><\/strong>  Last year at this time, there\nwas optimism not just because of the tax cuts but also because we were in the\nmidst of a rare, in-phase worldwide expansion. \nIt seemed that growth was accelerating everywhere.  But to quote Inspector Clouseau: \u00e2\u20ac\u0153Not\nanymore!\u00e2\u20ac\u009d, and that does not bode well for growth going forward.  In economics, nothing is free and that\nincludes government shutdowns and trade wars. \n<\/em><\/strong>There are both real and emotional impacts.  In addition to the economic moderation,\noptimism, not just in the U.S. but around the world is fading.   Indeed,\nthe International Monetary Fund revised down its 2019 world growth estimate for\nthe second time in three months. <\/em><\/strong> I am not saying we are headed into a\nrecession.  We should get through this\nyear unscathed.  But there are weaknesses that are\nemerging that could lead to a further slowdown as we go through the second half\nof this year and into 2020.  <\/em><\/strong>How\nthe markets hold up will depend upon investors\u00e2\u20ac\u2122 perceptions of the longer-term\nimpact of the government shutdown and the trade war.  Currently, the shutdown is viewed as largely\na nuisance.  That may not be off base,\nbut only as long as it doesn\u00e2\u20ac\u2122t go on much longer.  However, there is growing concern that the trade\nsituation will create a more lasting worldwide slowdown.<\/em><\/strong> And that is\nsomething that could affect investment decisions not just in equities but\ncapital spending as well.  We are in a\nperiod of uncertainty right now.  Growth\nis solid, but for how much longer is unclear.<\/em><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

KEY DATA: Sales (Month): -5.5%; Over-Year: -10.1%; Prices (Over-Year): +2.9%\/ Phila Fed (Nonman.): -6.7 points; New Orders: -20.6 points; Expectations: -15.6 points IN A NUTSHELL:  \u00e2\u20ac\u0153The manufacturing sector may be holding up but the rest of the economy, especially housing, isn\u00e2\u20ac\u2122t.\u00e2\u20ac\u009d WHAT IT MEANS:  While the shutdown continues, the economy is being battered.  The latest … Continue reading December Existing Home Sales and January Philadelphia Fed NonManufacturing Survey<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-1441","post","type-post","status-publish","format-standard","hentry","category-economic-indicators"],"_links":{"self":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1441","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1441"}],"version-history":[{"count":1,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1441\/revisions"}],"predecessor-version":[{"id":1442,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1441\/revisions\/1442"}],"wp:attachment":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1441"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1441"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1441"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}