Tag Archives: economy

Construction is Dragging

By Alhambra Investment Partners

Lost amid last week’s stock euphoria was the collapse in both the ISM’s Chicago Business Barometer (which I covered here) and construction spending. While sentiment surveys are hard to judge, it wasn’t a huge intuitive leap to suggest that both data points may be related to the energy sector. While that will remain unanswered for Chicago, the construction figures are much more conclusive in that regard.

In terms of nonresidential private construction, a harder figure for capex spending and proclivity, January 2015 was only 4.1% above January 2014. That amounted, in non-adjusted terms, to a gain of just $1 billion which was the smallest advance since October 2013.

ABOOK March 2015 Construction Nonres NSA Continue reading Construction is Dragging

Around the Web

By Biiwii

A more annoying ‘around the web’ than usual…

  • Adjusting Barry Ritholtz for inflation and hypocrisy  –IKN  [biiwii comment: a short, sweet and perfect little post exposing b/s in a corner of the internet i don’t normally expect to find it. but then again, it’s everywhere isn’t it?  i am sure in all my years of writing you’ve even found some of it here… and @ IKN and well, everywhere]
  • What Top Fund Managers Really Think About Gold  –Casey Research  [biiwii comment: speaking of bullshit, i’ll go a little IKN on you and present the winner of the b/s olympics, this hilariously titled piece from jeff clark.  jim rickards helped bail out ltcm, wrote books and is a smart guy who i sincerely respect.  but a top fund manager?  really?  now the rest of them… a “wealth coach”, a part newsletter writer/part fund manager and then old pal chris martenson, a “futurist who specializes in energy depletion”… please.  it’s another gold article attempting to make sense of things that seemingly don’t make sense, and that is the answer… it doesn’t make sense but it is what it is.  got that jeff?  i just wrote a post that wondered if the gold promoters were extinct or maybe just tuned out.  they’re not extinct, so hopefully they are well tuned out.  i’d better move on before i get hung up on this one and piss myself off]

 

O’Neill: Why the US is Not as Strong as You Think

By Biiwii

From CNBC (hey look, they have some good content… it’s not all mindless, after all).

Jim O’Neill on the Swiss Franc, the Euro and the US economy…

O’Neill: Why the US is not as strong as you think

Around the Web

By Biiwii

  • Gathering thin reeds  –Jeff Saut  [biiwii comment; oh jeff, how could you own anything by putnam? oh, they’ve cleaned up their front running act?  i see.  all the same, no thank you…  not that it matters to you, but you are on notice for inclusion in this segment in the future.  putnam?  really?  every time I saw the ‘proud sponsor of the n.e. patriots’ ads this past football season, I wanted to hurl]
  • btw  –Josh Brown
  • HP Warns and Blames the Mighty Greenback  –Across the Curve  [biiwii comment: add hp to the list.  since q4 we have been on watch for the strong dollar dynamic to have some effect in corp. america.  not the end of the world, but an effect]

 

Architecture Billings Flashes Warning

By Tom McClellan

Architecture Billings Index Flashes Warning

Architecture Billings Index
February 20, 2015

The latest news from the American Institute of Architects (AIA) has some economists alarmed, because it shows a potential shrinkage in housing related activity.  The AIA publishes data based on surveys of member firms, known as Architecture Billings Indices, and their two main index products are the Billings Index and the Inquiries Index.  Billings represents actual work that gets billed to the customer, while Inquiries is a softer data set reflecting customers potentially generating new work.

Continue reading Architecture Billings Flashes Warning

Is it Time to Zig?

By Alhambra Investment Partners

The US stock market made another all time high last week amid more mediocre – at best – US economic data. Much of the gain was credited to positive developments in the geopolitical arena as a ceasefire was announced in Ukraine and negotiations continued on Greek debt relief with some positive signs that an agreement might be reached. Whether either of those things are important for the value of US stocks is questionable at best but the bulls managed to convince themselves that they are and that is all that really matters. From a technical and fundamental perspective I’m a bit skeptical of this move even if it does make a new high. The rally was on fairly light volume, stocks have been struggling for months and this doesn’t change much in that regard. The S&P is up less than 2% on the year and less than 4% since September. Not exactly ripping even if it does go into the record books.

Continue reading Is it Time to Zig?

Macro Themes & Research Highlights

By Alhambra Investment Partners

Deflation Narrative text

deflation narrative

Continue reading Macro Themes & Research Highlights

Cyclical Gold Ratios

If we are going to use the CCI-Gold ratio as an important indicator to global economic contraction, we might view its recent bounce as making sense with respect to a broad global asset market bounce (incl. commodities) and in the US, a break upward from the recent nerve wracking ‘swing phase’ of volatile ups and downs in the stock market.

cci.gold

NFTRH managed the bullish stock market break in real time and I personally positioned accordingly.  But I am not going to go all ‘Dow 30,000′ on you in Armstongian fashion.  I am simply going to note that the indicator above has made a cyclical trigger (most recent red arrow) and its companion, the Palladium-Gold ratio is looking none too good either (though the MA’s have not triggered).

pall.gold

If these act as they historically have, they are a ticking clock.  This clock ticks painfully slowly, but it is ticking for the economy none the less.

Around the Web

 

Winter is Coming

Guest Post by Michael Ashton

Sometimes being a value investor, amid overvalued (and ever more so) markets, feels a bit like being a Stark in Westeros. The analogy will be lost on you if you do not follow Game of Thrones, but the Starks hold the largest of the sub-kingdoms in Westeros. This kingdom also happens to be the coldest, and the sober Starks are always reminding people that “Winter is coming.”

I should observe that winter in Westeros is a much more serious affair than it is around here; it comes at odd intervals but can last for years. So being prepared for winter is really important. However, getting people to prepare for winter during the long “summer” is very difficult.

Sound familiar? The thing to keep in mind is that the Starks are always right, eventually, and they’re the ones who come through the winter in the best shape. Such is the case with value investors. (Some people might prefer calling value investors who are bearish on stocks right now “Chicken Littles” but I prefer being compared to Ned Stark, thanks. Although both of them have been known to lose their heads on occasion.)

Fortunately, it does not appear that winter is coming to the U.S. very soon. Friday’s Employment report was strong, despite the beginnings of downsizing in the oil and gas extraction businesses. The chart below shows the Baker Hughes oil and gas rig count, which is falling at a rate every bit as fast as it did in the credit crisis.

rig count

Continue reading Winter is Coming

The “Big Lie” About the US Jobs Picture

Guest Post by Elliott Wave International

The “Big Lie” About the US Jobs Picture

Some 30 million people are either out of work or severely underemployed

Editor’s note: You’ll find the text version of the story below the video.

The financial media has recently featured stories with an upbeat outlook for the U.S. economy.

For example: The economy is on track for “the fastest growth in a decade” (Associated Press), and “Experts expect jobs aplenty in ’15” (USA Today).

This upbeat tone is related to December’s U.S. jobless rate of 5.6%, its lowest since June 2008.

Continue reading The “Big Lie” About the US Jobs Picture