Sunday Night Economic Assessment

The US Industrial economy advanced slightly last week (if pipeline scheduling is correct), while consumer spending continued to fade.

The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) moved higher in the latest week (third gain in four weeks) at 121.8 (vs last weeks revised 121.4). In its dailies (raw, non-seasonally adjusted flows) the week started soft, firmed midweek, then ended somewhat flat.

The Consumption Index eased again (5th down-week in a row), slipping to 134.5 (from last weeks 135.4). In its dailies the week was choppy but overall soft.

The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) again continued in its long-term decline.

Food Group scheduling (see "Part 8" posts on the Investor Village site) is of great concern... the measure has been ominously strengthening as of late, rising to near levels not seen since the January/February 2009 recessionary-bottom. Such activity is strongly indicative of deep consumer mistrust in the economy (probably the reason for that 5-week decline in the consumption index). The Food group has a contra-relationship with consumption, and gains to the measure historically have tended to coincide with weakness in consumer spending.

The state of the recovery for the moment is very uncertain... almost akin to a gas leak in the basement that has yet to ignite (where you hope you can get the gas shut off and basement aired out before something produces a spark). Hopefully one of those sparks won't be the saber-rattling between Democrats and Republicans regarding budgeting and threatened government default, or the forthcoming end of QE2 (second round of quantitative easing).

(My preference would be to see to see at least a meek "QE-3"... perhaps 1/2 of QE-2 (though it will continue to pressure the dollar)... and to see the White House take default off the table by executive order.)

But for the moment... the recovery continues to appear supported by the lead in the Consumption Index over the Production Index, and continuing declines in the Inventories measure... assuming no sparks! Once past the Easter holiday we are really going to need to see consumer spending reaffirm itself to keep fundamentals in place.



-Robry825

Sunday Night Economic Assessment

The US Industrial economy held steady last week (if pipeline scheduling is correct), while consumer spending continued to whittle away at it self.

The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) was unchanged in the latest week (breaking its string of two up-weeks in a row) at 121.4 (vs last weeks revised 121.4). In its dailies (raw, non-seasonally adjusted flows) the week was soft though in line with seasonals.

The Consumption Index again backtracked (fourth down-week in a row), dipping to 135.4 (from last weeks 141.9). In its dailies the week started somewhat soft-to-flat, then weakened midweek on.

The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) again continued in its long-term decline.

For the moment, the recovery appears supported by the lead in the Consumption Index over the Production Index, and continuing declines in the Inventories measure.

However, the declines in the Consumption Index are worrisome, and once past the Easter holiday we will need to see consumer spending reaffirm itself to keep fundamentals in place.



-Robry825

Sunday Night Economic Assessment

The US Industrial economy gained a little more ground last week (if pipeline scheduling is correct), while consumer spending continued to give back gains.

The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) gained for it's second week in a row, advancing 121.3 (vs last weeks revised 120.9). In its dailies (raw, non-seasonally adjusted flows) the week started off strongly, but softened as the week progressed..

The Consumption Index continued lower (third down-week in a row), dipping to 141.9 (from last weeks 145.5). In its dailies the week started somewhat firm, strengthened through Wednesday, then declined through to the weekend.

The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) again continued in its long-term decline.

Overall, the recovery continues to appear strongly supported by elevated consumer-spending, an uncharacteristically-large lead in the Consumption Index over the Production Index, and continuing declines in the Inventories measure.

First-quarter results (due out starting in another weeks) look to be exceptionally strong, as large gaps (in the past) of consumption over production have generally been consistent (in the modeling) with large jumps in profitability. And that gap widened at the end of the quarter... probably to add to optimism as CEO's prepare their comments toward the 2nd quarter.



-Robry825

Sunday Night Economic Assessment

The US Industrial economy turned and advanced last week (if pipeline scheduling is correct), consumer spending continued to ease, and the calender-page turned to start the second quarter.

The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) broke its string of four down-weeks in a row, gaining to slipped for it's fourth week in a row, easing to 120.9 (vs last weeks revised 120.4). In its dailies (raw, non-seasonally adjusted flows) the week started flat and finished strong. Seasonally-adjusted, there was a pronounced change precisely at quarters-end, with the first two days of April exceptionally strong.

The Consumption Index edged lower (second down-week in a row), dipping to 145.5 (from last weeks 148.1). In its dailies the week started soft but finished very strongly, paralleling the Production Index's quarters-end flip to positive..

The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) again continued in its long-term decline.

Overall, the recovery continues to appear strongly supported by elevated consumer-spending, an uncharacteristically-large lead in the Consumption Index over the Production Index, and continuing declines in the Inventories measure.

First-quarter results (due out starting in about 3 weeks) look to be exceptionally strong, as large gaps (in the past) of consumption over production have generally been consistent (in the modeling) with large jumps in profitability. And that gap widened at the end of the quarter... probably to add to optimism as CEO's prepare their comments toward the 2nd quarter.

(One has to wonder at that softening in the Production Index the last four weeks of the quarter... that looks to have ended in the gas-flows precisely at quarters-end. Makes one think industry is sandbagging... seeing a strong quarter coming and cutting production runs & inventory abnormally to cut expenses... to "juice" an anticipated strong quarter into a barn-burner.)



-Robry825

Sunday Night Economic Assessment

The US Industrial economy again continued to gradually ease last week (if pipeline scheduling is correct), while consumer spending edged off of it's prior-week surge.

The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) slipped for it's fourth week in a row, easing to 120.3 (vs last weeks 121.2). In its dailies (raw, non-seasonally adjusted flows) the week was choppy, starting soft and ending with a flattish look.

The Consumption Index also declined (breaking it's string of four up-weeks in a row), gaining to 148.1 (from last weeks 150.6). In its dailies the week started strong in its raw (non-seasonally adjusted) numbers then softened mid-week.

The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) again continued in its long-term decline.

Overall, the recovery (despite the weeks declines) continues to appear strongly supported by elevated consumer-spending, an uncharacteristically-large lead in the Consumption Index over the Production Index, and continuing declines in the Inventories measure.

First-quarter results (due out starting in about 3 weeks) look to be exceptionally strong, as large gaps (in the past) of consumption over production have generally been consistent (in the modeling) with large jumps in profitability. And that gap is widening near the end of the quarter... probably to add to optimism as CEO's prepare their comments toward the 2nd quarter.

One possible good sign in the gas flows over the weekend - a large plunge in the gas-flows for the food-group (See the "Part-8" postings on the Investor-Village CWEI site) , which has been fearfully-robust virtually the whole winter (The food group has served as a contra-indicator in the past, probably because that junk-food-laden sampling picks up on America's habit of comforting its nervousness by heading for the fridge).

I took the news as quite economically-positive late last week... perhaps that food-group (if its premature weekend scheduling numbers hold up) is early confirmation... we shall see in coming weeks.

This upcoming week is both an end-of-month week and an end-of-quarter week. Industrial gas-flow numbers can sometimes change rapidly at such times (up or down), and with the gas-flow implied strength in consumption, a pickup in industrial activity once past quarters-end would not be (historically) unexpected.

Of course, with the slow-slide in the past few weeks on the industrial-side, an unexpectedly-bad unemployment report would also not be unexpected, so this game of watching and waiting goes on...

ROBRY DATA On ENERCAST

(http://www.firstenercastfinancial.com/energy/)

As a reminder, Enercast Financial now hosts several web pages on their site for viewing and downloading the data I post, and I would want to encourage it's use (Enercast now offers the most comprehensive, accurate, and up-to-date site for the data I post... and has become the preferred site on the natural-gas side of the data).

(First Enercast also shares my appreciation for the public domain, so the Robry825 data downloads will continue to be free of cost and free of restrictions... and can be shared with friends, reposted, published (etc) at your discretion... for the better of all).











Also linked through the Enercast site is the new "Robry-Calc" spreadsheet application (another project that I have become both deeply involved with the past couple of years and have mentioned previously), which I hope will serve to be of value for many as well. In many ways I believe "Robry-calc" to be revolutionary, and it is at it's foundation what I rely upon for the number-crunching I do daily. It is (by its nature) simple enough that the kids can easily use it to check their homework at night, and at the same time complex and powerful enough to be able to open up to process millions (or even billions) of cells of data in seconds.


-Robry825

Sunday Night Economic Assessment

The US Industrial economy continued to ease last week (if pipeline scheduling is correct), while consumer spending surged.

The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) had its third decline in a row, easing to 121.2 (vs last weeks 121.9). In its dailies (raw, non-seasonally adjusted flows) the week had a soft-to-flat look throughout.

Different story on the consumption side, with the Consumption Index surging to a record high (its fourth weekly gain in a row), gaining to 150.6 (from last weeks 147.1). In its dailies the week started soft in its raw (non-seasonally adjusted) numbers then took off starting on Monday and especially Tuesday.

The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) again continued in its long-term decline.

Overall, the recovery continues to appear strongly supported by elevated consumer-spending, an uncharacteristically-large lead in the Consumption Index over the Production Index, and continuing declines in the Inventories measure.

I suspect first-quarter results (due out starting in about 3 weeks) are going to be exceptionally strong, as large gaps (in the past) of consumption over production have generally been consistent (in the modeling) with large jumps in profitability. And that gap is widening near the end of the quarter... probably to add to optimism as CEO's prepare their comments toward the 2nd quarter.

There is a "teeter-totter" like effect behind all this (and those following this blog for some time have undoubtedly picked up on this) in that the Production Index often moves conversely to the direction of the Consumption Index, and I have postulated in the past that those "converse" moves are often politically-driven... with positive effects to the Productive end of US society (and negative effects to the Consumptive end of US society) when Republicans (perceived as representing business & investor interests) get their way...and positive effects to the Consumptive end of US society (and negative effects to the Productive end of US society) when Democrats (perceived as representing consumer interests) get their way.

We are now in a phase (have been the past 3 weeks) where that teeter-totter is strongly tipped in the consumers direction (thanks also both to accommodative Federal Reserve policy and stimulative governmental policy), which is consistent with good corporate profitability. (the direction of the "fulcrum" (mid-point) of that "teeter-totter" would also strongly consistent with economic direction in past data).

Also consistent in past data when the economic "teeter-totter" gets tipped strongly in the consumers direction (as it is today) is a bit of inflationary pressure and commodity-bullishness... which we are also seeing a little bit of in here too.



-Robry825

Sunday Night Economic Assessment

(My heart goes out to the many suffering in the wake of the devastation in Japan, where tens of thousands have doubtlessly perished (and multitudes been left homeless) in the trampling footsteps of a massive earthquake and tsunami, and those who face the difficult and daunting task of putting things back together in the face of the further fear of a possible nuclear-reactor-meltdown catastrophe.)

The US Industrial economy again eased off a tad last week (if pipeline scheduling is correct), while consumer spending continued to strengthen.

The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) put in its second down-week in a row, easing to 121.9 (vs last weeks 122.4). In its dailies (raw, non-seasonally adjusted flows) the week started soft but firmed as the week progressed.

The Consumption Index went the other way (having its third weekly gain in a row), gaining to 147.1 (from last weeks 145.9). In its dailies the week (as last week) looked soft in its raw (non-seasonally adjusted) numbers but benefited from seasonals.

The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index) again continued in its long-term decline.

Overall, the recovery continues to appear strongly supported by elevated consumer-spending, an uncharacteristically-large lead in the Consumption Index over the Production Index, recent firmness in industrial gas-flow scheduling, and continuing declines in the Inventories measure.



-Robry825