The US Industrial economy continues to push ahead (if pipeline scheduling is correct), as consumer spending surges.The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) racked up its 17th advance in 18 weeks, and now stands higher than at any time since October 27th, 2008 (It bottomed May 28th), and at levels suggesting it has made up better than two-thirds of it's recessionary deficit. In its dailies (as evidenced by the "Part 7" industrial daily posts on the IV-CWEI site) the week moderated just a tad from the previous week.
On a sector-by-sector basis (see part "8" posts on the IV-CWEI site) the steel sector (which led the other groups to the downside with a 75% drop in scheduling) continues to lead on the upside and has more than tripled (up 265%) since its worst month ever (June).
September closed out to be a very strong month (over August), with broad-based strength including the paper, chemical, refining, mining, and metals sectors.
The Paperboard-based Consumption Index (as last week) surged all week, closing out the week at an all-time high. The Consumption Index remains solidly above the Production Index... supporting the recent momentum of recovery.
The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) remains well-below pre-recession levels, adding inventory-rebuilding as another support-mechanism near-term to the economy.
I am leery (based upon ongoing weakness in Automotive gas-flow scheduling) that the Consumption index has somewhat overestimated the gains in consumption. One big handicap of the Consumption Index is (because it is derived from gas-flows into cardboard-box manufacturing) is it doesn't touch merchandise that isn't packed in cardboard boxes (like Automobiles). So with gas-flows suggesting softness in the Auto-Sector (Which the model does not represent) and strength in non-auto (Which the model does represent) the non-auto strength gets imputed into the whole of US consumption by the model.
I also struggle with the low sample size of the paperboard sector model, and wish that there were better representation of the paperboard industry in the FERC-mandated pipeline informational postings. (If it wasn't for the FERC pushing for greater transparency, we would not have the info that we have, and most of my posts & blogs would have never existed.)
My hope is that these posts of mine may serve as a demonstration of the great worth of this data, and perhaps one day, government and industry will wake up to what they could have, more avenues of information will open (intrastates and LDC's), and more help can one day preemptively be done to stave off recession or blunt impact on individual sectors of the economy by either the governments or the markets.
How much better these posts would be with the NICOR's and the MICHCON's of the US represented!
-Robry825
