US Economy

Recession Drumbeat Getting Louder

Apr 20, 2023 3 min read

The S&P 500 has been holding up quite well as the the nattering nabobs of negativism beat their drums more loudly. Today's batch of economic indicators gave the bears plenty to growl about. Consider the following: (1) LEI. The Index of Leading Economic Indicators (LEI) peaked at a record high during February 2022 (chart). It's been falling since then. It was down during March

Ed Yardeni

More Shoes To Drop?

Mar 17, 2023 2 min read paid

Needless to say, the recent turmoil in the banking sector is raising renewed fears of a recession and a resumption of last year's bear market. The rolling recession could turn into a full-blown recession if the turmoil roils the banking system significantly. Bankers could become more cautious lenders especially among the smaller regional and community banks. On the other hand, the Fed probably stabilized the situation with its

Ed Yardeni

Capital Spending Getting A Lift From Washington

Feb 28, 2023 1 min read paid

Inflation-adjusted capital spending rose 4% y/y during Q4. That was a solid increase. However, it may be starting to slow. The CEO Outlook Index compiled by the Business Roundtable fell most of last year as the Fed's interest rate hikes heightened recession concerns (chart). Nondefense capital goods orders excluding aircraft have stalled at a record high in recent months through January (chart). The weakness in primary metals,

Ed Yardeni

More Soft Landing Stats

Feb 22, 2023 2 min read paid

No boom, no bust. That describes yesterday's flash estimates for February's M-PMI and NM-PMI released by S&P Global. They both track the comparable series compiled by the Institute for Supply Management (ISM). The flash M-PMI rose from 46.9 in January to 47.8 this month (chart). It suggests that the ISM's version of this index will uptick but remain below 50.

Ed Yardeni

Less Inflation & Growth In Three Regional Surveys

Jan 24, 2023 1 min read paid

We now have three business surveys for January conducted by the NY, Philly, and Richmond Fed district banks. Collectively, they are showing less economic growth and lower inflation. The average of their general business indexes dropped further into negative territory this month, suggesting that the M-PMI also fell further below 50.0 this month (chart).

Ed Yardeni

Surveys Say NY & Philly Manufacturing Weak

Jan 19, 2023 1 min read paid

Stock prices tanked yesterday following reports showing sharp declines in December's retail sales and industrial production. As a result, the Citigroup Economic Surprise Index (CESI) fell to -24.7 (chart). The 13-week change in the 10-year US Treasury yield (in basis points) is highly correlated with the CESI and it continued to drop yesterday. On Tuesday, January's NY Fed business survey was much weaker than we

Ed Yardeni

A Bowl of Mixed Nuts

Jan 4, 2023 2 min read paid

Today's batch of economic indicators was mixed, showing that the manufacturing economy remains weak, while the labor market remains strong. In addition, inflationary pressures continue to ebb in the goods sector. Yesterday, the Atlanta Fed's GDPNow tracking model's latest estimate was that real GDP rose 3.9% (saar) during Q4, up from 3.2% during Q3. Here's more:

Ed Yardeni

Running Out of Money?

Jan 2, 2023 2 min read members

Monetarists seem to be making a comeback, and they are sounding the alarm that the recent weakness in the M2 measure of money is confirming that monetary policy already is tight enough to cause a recession. We’ve addressed this issue in the past, and we still aren’t alarmed.

Ed Yardeni

Loose Lips Sink Bonds & Stocks

Oct 20, 2022 2 min read paid

The members of the FOMC ("Federal Open Mouth Committee") continue to sink prices in the fixed-income markets. The 2-year Treasury yield soared to 4.62% today, while the 10-year Treasury yield jumped to 4.24% (chart). The S&P 500 rallied through mid-morning, but then fell the rest of the day to 3665.78, just below the June 16 low. Triggering today's selloff in the

Ed Yardeni

Consumers Are Still Consuming

Oct 11, 2022 1 min read paid

So far, consumers haven’t read the recession memo. They are spending freely, according to MasterCard SpendingPulse, which found that retail sales grew by double digits, both online and offline, in September 2022. Excluding autos, off-line retail sales increased 11% y/y, and e-commerce sales rose 10.7% y/y. (The data are based on in-store and online retail sales across all forms of payment and are not adjusted for

Ed Yardeni

No Recession In Services

Oct 5, 2022 1 min read

Following today's release of September's nonmanufacturing purchasing managers index (NM-PMI), the Atlanta Fed's GDPNow tracking model revised Q3's growth rate from 2.3% (saar) to 2.7%. Consumer spending and real-gross private domestic investment were revised higher from 0.7% to 1.1% and from -4.1% to -3.6%. The next recession might be the most widely anticipated recession that doesn&

Ed Yardeni

Slow Moving Economy

Sep 15, 2022 1 min read

August's industrial production and inflation-adjusted retail sales reports today show that the US economy is growing, but just barely. The former was down a bit, while the latter was up a bit (charts below). Both are included in the Coincident Economic Indicators. Consumers went on a spending spree after the lockdown recession in early 2020. They spent mostly on goods because many services were still not open for

Ed Yardeni

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