Am (gladly) able to backtrack on yesterdays dire economics post. There was an error that overemphasized the drop off in industrial activity. While the economy is sluggish at present, it is no where near approaching that "point of no return" as feared within yesterdays post. A "corrected" commentary follows...The US Industrial economy advanced meekly last week (if pipeline scheduling is correct), while consumer spending softened.
The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) gained for the ninth time in the last ten weeks to 124.8 (vs last weeks revised 124.7). It was the fourth straight weekly record-high in a row for the index. In its dailies (raw, non-seasonally adjusted flows) the week started firm but weakened midweek. (In the last two days, the index declined to 124.6)
The Consumption Index reversed its recent short-term surge, slumping to 139.8 (from last weeks 144.9). In its dailies the measure was very strong early through the 31st, Then ratcheted down sharply June 1st on.. (In the last two days, the index declined to 137.3)
The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) again continued in its long-term decline.
Steel-manufacturing scheduling dropped precipitously to start June (averaging .145 BCF/day, down from .153 in May and well below the recovery high of .206 in May of 2010). Steel-scheduling (though I haven't had a chance to roll it into these posts) is consistent with durable-goods orders, and its rapid-weakening had been a harbinger of recessions past.
Food-Group scheduling, which bearishly broke above previous-recession highs in April, also remains a worry. The Food group has a contra-relationship with consumption, and gains to the measure historically have tended to coincide with weakness in consumer spending.
-Robry825
