Bernanke Raises Interest Rates
In its first meeting with Ben Bernanke as chair, the Fed raised short-term interest rates a quarter point. So Ben is willing to raise rates. No surprise there. And the Fed sees strength in current …
Rockies & Sunbelt look good
State personal income shows fastest growth in the Rockies and the Sunbelt. The common factor is rapid population growth. Folks are moving into these regions, pushing personal income up. On a per capita basis, the …
Consumer Confidence: Beware the Headline
The Wall Street Journal headline: "Consumer Confidence Soars Amid Strong Start to 2006" Now take a look at the data: That last data point, the small increase, is confidence soaring. In truth, confidence is pretty …
Capital Goods Orders
Monthly data on orders for capital goods were soft, but not very far off trend. So, no need to change a forecast here, but no cause for celebration either. Computer equipment still looks OK, but …
Home Sales Weak: The End is Near
New home sales are weak, and existing home sales are past their peak. What’s even more indicative of a market weakening is the large inventory of unsold homes. Keep in mind that January weather nationally …
Producer Prices Down Nicely
Inflation in producer prices declined nicely in February–but the statisticians haven’t yet tallied this month’s gasoline costs. The government report showed a large decline in energy costs. Here’s what’s not to like: even excluding food …
Production Headline Better Than Reality
Industrial production rose nicely in February, but the gain was primarily due to utilities having more business in February than in unseasonably-mild January. The better gauge for month-to-month fluctuations is industrial production in the manufacturing …
Housing Starts Continue Strong
OK, the headlines say that housing starts dropped. But really, January was abnormally high, thanks to mild weather in much of the country (reversed in February). The trend looks steady to my eyes: Permits for …
Inflation Not Bad
Today’s news was OK. I usually look at the CPI in 12-month percent change format: I see that high energy inflation (included in "All Items") has not bled through to the core inflation rate ("Ex …
Inventories Look Lean
The inventory and sales report on American business shows that inventories are lean. This usually means that production will be increased to restock shelves. But look at the longer-run trend: For over a decade, we’ve …
Value Pricing on Airlines
Northwest Airlines is going to start charging premium prices for exit row seats and for aisle seats. Although I dislike the complexity of airline pricing, it does make sense to price up for a valuable …
Banks Competing on Deposits
Last week I sent my banker friends an article about the coming funding crunch: loan growth will exceed deposit growth in 2006. I recommended that banks engage in serious efforts to beef up core deposits …