The US Industrial economy took a break in the latest week (if pipeline scheduling is correct), consumer spending maintained its recent surge, and inventories bullishly continued their recent trends of sharp contraction.The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) eased for the first time in 5 weeks, but remains 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 was soft throughout.
Apart from the 28-day moving average of the Production Index, last week was the fourth down week in a row in the raw numbers, with seasonal adjustments within those weeks muting the decline. Seasonal factors now include last years fall plunge within their calculations.
On a sector-by-sector basis (as per the "Part 8" posts) the softness was centered mostly in the chemical/fertilizer and refining sectors, missing the core areas of the recent economic recovery. Steel delivery natgas scheduling remains very firm (steel has been front-and-center in the recovery) and the Automotive group is trying for a mid-month increase... challenging its monthly "climb-early-then-die" habit.
The Paperboard-based Consumption Index maintained its recent surge, again setting another all-time high within the week. 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-recessionary levels and is dropping fast. Inventory-rebuilding (once it kicks in) will be another major support-mechanism for the economy.
Next challenge (for the economy) looks to be the health-care debate in congress. Will the Democrats steamroll the republicans by breaking a filibuster to win a purely democratic health-care bill (scaring the pants off of America's productive class)? Will the Republicans scuttle health-care reform by a successful filibuster (depressing the pants off of America's consumptive class)? A lot of folks want to see genuine, non-gimmicky reform. What those folks are given to see could be an economy maker... or an economy breaker.
Best thing the Dem's and Rep's could do... go into a closed room (with the camera's, lobbyists, and power-brokers left behind), give the Democrats 60% of what they want, the Republicans 40% of what they want (as per the 60/40 split in representation) and come out of the room to reassure both the productive class and consumptive class with a bill that would be supported by 70% of each party.
Please... Please... Please... Forget about the filibuster gambit!
-Robry825
