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A Tale of Two Trends

A tale of two trends. That is what it feels like these days. The consumer-related trends are healthy and pointing toward a growing economy. Other trends, such as Nondefense Capital Goods New Orders, are pointing in the opposite direction.

What is a manager to do? Know which leading indicators count when it comes to your business and your markets. For the overall economy, the consumer ultimately steers the ship. Keep your eye on the retail sales and employment trends in addition to housing. That is what we are doing.

What does the economy tell us about the future for Forming & Fabricating?

In this post, we will explore what the economy has in store for the Forming & Fabricating industries and the trends that should impact business decisions among those in the industry.

Annual economic growth in the US, as measured by Industrial Production, has slowed substantially since reaching a rate of growth high in February of this year. The US economy is expected to decelerate to 2.1% by the end of 2015 and remain in relatively slow-growth mode through the first half of next year.

Talk About Not Getting Any Respect…

Europe isn’t getting the economic respect it deserves. Headlines tell us China is devaluing their currency; their currency is down about 2.6% against the US dollar since July. Neglected, is the approximately 2.3% decline in the euro versus the USD since July. Why the focus on China and not Europe?

China accounts for approximately 13.4% of the world’s economy based on 2014 IMF GDP statistics.
In contrast, Europe accounts for approximately 25.2% of the world’s economy.

Subscriber Bulletin: Stocks, Oil, China, and the US Economy

A chain of events culminating with China’s recent currency devaluation and follow-on decline in commodity prices/share prices across the globe has created fear and consternation for decision makers. The view to the future is not as clear as it was a few days ago. A more detailed analysis of what is going on and what it means will be in this month’s ITR Trends Report but here is the synopsis:

We think the S&P 500 is correcting and not entering into a full-fledged bear market based on current economic fundamentals.

China devaluates currency - what does it mean for the US Macroeconomic Outlook?

The Chinese devalued their currency a few days ago. The change in policy appears to be an attempt to stimulate China’s exports in light of the ongoing cyclical weakness in that economy. Two consequences to the currency change are 1) a stronger US dollar and 2) weaker oil prices. Neither consequence is helpful to the macroeconomic status in the US.

Press Release: ITR Economics and Chief Outsiders Announce Partnership for Mid-sized Business Growth

Top economists and fractional marketing execs combine resources to better serve CEOs.

June Retail Sales Up - US Economy sees ongoing growth

Retail sales in June came in 2.9% higher than the year-ago level. This is the best year-over-year performance since January 2015. The May-to-June seasonal decline in retail sales activity (nominal dollars) was milder than each of the last three years. It was a good June. Automobile retail sales for the month were up 10.5% from the year before. All told it was a good month and portends ongoing growth for the US economy as we head through the second half of the year.

ITR Economics BULLETIN: US Census Bureau Annual Revision

On May 15, the US Census Bureau released their annual revision to the New Orders data ITR Economics uses in EVPs, Reports, and our monthly publications. The resulting revision was one of the largest we have ever seen, and many sectors were dramatically affected. As an example of how severe this revision was, Industrial Machinery New Orders was downward revised by 47.4% on an annual moving total basis, from $61.2 billion (as reported in May’s Trends Report) to $32.2 billion. Construction Machinery New Orders saw a similar revision; its annual moving total was revised downward 28.7%.

Manufacturing Reality

I read a recent article written by a former manufacturing executive in which he expressed his grave concerns over free trade agreements. He lays the following problems at the feet of free trade: massive trade deficit of over $10-$11 trillion; millions of good paying jobs have been lost (net); manufacturing sector has suffered a massive loss, from over 20% of GDP to approximately 11%.

I think these concerns, and perceptions, are shared by millions of Americans. Fortunately for all of us, their perception is not backed by reality.

Tax time cut into Retail Sales in April

April retail sales came out and the numbers were weak (not seasonally adjusted and not adjusted for price changes). Data for all categories is not yet available but we can note the following:

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