Bloomberg Survey ================================================================ Release Period Prior Median Indicator Date Value Forecast ================================================================ Construct Spending MOM% 5/4 March -0.9% -1.6% Pending Homes MOM% 5/4 March 2.1% 0.0% ISM NonManu Index 5/5 April 40.8 42.0 Initial Claims ,000’s 5/7 2-May 631 635 Cont. Claims ,000’s 5/7 25-Apr 6271 6350 Productivity QOQ% 5/7 4Q -0.4% 0.8% Labor Costs QOQ% 5/7 4Q P 5.7% 2.8% Cons. Credit $ Blns 5/7 March -7.5 -4.5 Nonfarm Payrolls ,000’s 5/8 April -663 -600 Unemploy Rate % 5/8 April 8.5% 8.9% Manu Payrolls ,000’s 5/8 April -161 -157 Hourly Earnings MOM% 5/8 April 0.2% 0.2% Hourly Earnings YOY% 5/8 April 3.4% 3.3% Avg Weekly Hours 5/8 April 33.2 33.2 Whlsale Inv. MOM% 5/8 March -1.5% -1.0% ================================================================
David Brooks interprets genius through the availability heuristic
For the last 200 years, despite occasional shocks, the western world has been dominated by a belief in progress, based on its extraordinary scientific and entrepreneurial achievements. On a broader perspective, this optimism is a grave anomaly.
It is all of humanity that is under threat during a pandemic. The biggest question right now is this: How severe will the pandemic be? All countries should immediately now activate their pandemic plans.
—Margaret Chan, WHO director-general
The economy has continued to contract, though the pace of contraction appears to be somewhat slower. Household spending has shown signs of stabilizing, but remains constrained by ongoing job losses, lower housing wealth and tight credit.
—Fed Open Market Committee
I’m actually very enthusiastic about housing, and I haven’t said that in five years. We’re within shouting distance of a bottom.
I do not think there are grounds for great optimism. It is going to take a while, I think, to have a strong recovery.
There’s a visible commitment by the government to support these so-called systemically important institutions at this point, so they’re not going to go under in the sense of ceasing operations or even interrupting operations. It’s a question of how much support they’re going to need.
How quickly we deal with the system that is, as I say, still in intensive care, is the question.
The Federal Reserve is going beyond the traditional role of central banks here or abroad. At some point it’s reasonable to ask should this particular institution, with its independence very well protected, be allocating so much of what is essentially government money.
The inflation problem, which should be a real threat for the future, is not right on the doorstep. But two or three years from now that may be the critical problem, how that’s handled. Because, given what the Federal Reserve has been doing, it’s going to be harder to retrace their steps, so to speak, than it ordinarily would be.
Institutional growth and the allocation to hedge funds will be significant [in 2009]. Pension plans, both public and private, need to take risk. People will start putting money into hedge funds in the fourth quarter.
—Stephen Nesbitt, CEO of pension fund adviser Cliffwater
There is a very widespread sense that the US “needs” China more now because it is issuing more Treasuries to finance its fiscal deficit.
That isn’t quite true.
According to Morgan Stanley – the following six will require capital
- Citigroup
- Bank of America
- SunTrust
- KeyCorp
- Regions
GDP = Consumption + Gross Investment + Government Spending + Exports – Imports
This is one of those good-bad numbers. Businesses are running about as lean as they possibly can be. It sets up the reality that any sort of increase in demand will cause firms to have to increase production.
—Joel Naroff, president of Naroff Economic Advisors
- GDP drops at a 6.1% annual pace, exceeding forecasts, but lower than the 6.3% annual rate in 4Q2008
- Weakest six months since 1957-1958, and that was the year of the Edsel
- Personal consumption increased 2.2% in Q1, vs a decrease of 4.3% in 4Q08
- Durable goods: up 9.4%, vs down 22.1% in 4Q08
- Nondurable goods: up 1.3%, vs down 9.4%
- Services: up 1.5%, same as 4Q08
- Real nonresidential fixed investment decreased 37.9% in Q1, vs 21.7% decrease in 4Q08
- Non residential structures: down 44.2%, vs down 9.4%
- Equipment & Software: down 33.8%, vs down 28.1%
- Residential: down 38%, vs down 22.8%
- Real exports & imports
- Exports: down 30%, vs down 23.6%
- Imports: down 34%, vs down 17.5%
- The pace of Government Spending declined, increasing 4%, vs 7% in Q4
- Private inventories subtracted 2.79% from Q1 GDP, almost half of the decline. On an real dollar basis, they decreased $103.7b in Q1, vs a decline of $25.8b in Q4.
- Big impact on real final sales (GDP minus change in private inventories)
- Big impact on real GDP, which would have declined at a 3.4% pace, otherwise
- Price Index for gross domestic purchases
- decreased 1%, compared to a decrease of 3.9% in 4Q08
- adjusted to exclude food & energy, the index increased 1.4% in Q1, vs 1.2% in 4Q08.
The slightly smaller decrease in real GDP in the first quarter than in the fourth reflected an upturn in PCE for durable and nondurable goods and a larger decrease in imports that were mostly offset by larger decreases in private inventory investment and in nonresidential structures and a downturn in federal government spending.
There wouldn’t be a case for new moves unless the economy appeared to be deteriorating at a faster clip, and the opposite is the case since the last meeting. [The statement may include] an acknowledgement that the decline in activity seems to have moderated a bit.
—Former Federal Reserve Governor Lyle Gramley
Stilltitled 