A Break Down Of PCEs

What do we spend money on? To answer that question, let's take a look at personal consumption expenditures, or PCEs. These are the largest component of the GDP report. Click on all images for a larger imageFirst, note that PCE expenditures are broken down into services, non-durable and durable expenditures.Services is the largest area of expenditures,...

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Bonddad In the NY Times

As some of you know, I also write a weekly column for 538.com. That site was recently purchased by the NY Times. My first blog entry as a New York Times Blogger is he...

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Robert Barro - Paste Eater

Yesterday, Harvard economist Robert Barro penned an editorial that has to be one of the most insulting to intelligent economic researchers and should embarrass Harvard University for employing someone willing to put his personal ideology above the academic reputation of Harvard like Mr. Barro. This editorial espoused the idiotic notion that somehow...

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Yesterday's Market

The SPYs were in a downward sloping channel yesterday, bounded by trend lines (a) and (b). Prices continually made lower lows and lower highs(c and d), eventually falling below the lower trend line at the close of trading on increased volume (e).On the daily chart, prices are in a downward sloping channel (a and b) and are currently in a fairly tight...

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State Tax Revenue Increasing

From the WSJ:Overall tax revenue increased 2.2% in 47 states that have reported their receipts for the three months ended June 30, compared with the same period a year ago, according to a report to be released Monday by the Nelson A. Rockefeller Institute of Government at the State University of New York.This marks the second quarter in a row of...

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Chip Sales Rise in July

From the WSJ:Global chip sales rose 1.2% in July from a month earlier despite signs of a slowing economy, with results remaining sharply above prior-year levels, according to the Semiconductor Industry Association. Chip sales in July reached $25.24 billion, up 37% on a yearly basis. The year-to-date increase was 47% above the moribund levels seen for the same period last year as by midyear the sector was starting to come out of a sharp slump in the wake of the financial crisis. Meanwhile, "worldwide sales of semiconductors were strong in...

Credit Card Losses Are Slowing

From the FT:US credit-card losses are falling faster than expected, with the six largest card issuers expected to earn nearly $10bn more in the coming 12 months than predicted, says a study by Moody’s.Historically, US credit-card write-offs have tracked the unemployment rate. But for the first time in a decade, loans considered uncollectible by...

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Yesterday's Market

Prices dropped after gapping at the open (a) but rebounded pretty quickly (b). After rallying, prices fell back to key support levels (c) before again moving higher. Notice that prices used the 10 minute EMA as technical support. Finally, prices ended near highs for the day.On the IEF, notice that prices were in a tight range for a 6 days (a)....

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Weekend Weimar And Beagle

It's that time of the week. Think and work on anything except the markets or the economy. Until Monday ...

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Weekly Indicators: Horse Latitudes Edition

- by New Deal democratAn initial note: at another, large blog, someone commented that "Krugman = lagging indicator." The person meant it sarcastically, but rephrased as "pundits = lagging indicator," it is true. It has been proven over and over again that pundit opinion as a whole follows trends. Which means that it misses turning points, which is why the KISS method of sticking with the LEI is more successful. As the economic data has deteriorated in the last few months, the range of generally accepted opinion has moved Gloomier and Doomier....

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GDP Redux

After looking at the numbers, this report looks like a one-off. Consider the following points (please reference the posts below).1.) PCEs are still increasing in line with the previous three quarters.2.) PCEs of durable goods increased 6.9%.3.) Service expenditures increased the most in a few years.4.) Gross private domestic investment increased at a strong rate5.) Equipment and software investment continues6.) Residential investment was positive as well.As I noted in the initial post on GDP, the real issue in the 2nd quarter was a huge increase...

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A Closer Look at GDP: Investment

Let's continue our look at today's GDP report with a closer look at domestic investment.Total domestic investment is increasing at a solid rate.Non-residential investment was just positive last quarter, although I wouldn't hold my breath about this number moving strongly higher in the near future.Equipment and software investment increased at a strong...

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A Closer Look At GDP: PCEs

Let's take a deeper look into the data from today's report, starting with the largest percentage component of GDP, personal consumption expenditures or PCEs. You can click on all images for a larger image.Total PCEs increased 2% from the preceding quarter, right in line with recent experience. Services -- which comprise 65% of PCEs saw the largest...

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Growth

As ever, figures provided by the ONS have had to be revised. This time the figures for growth in Q2 2010 have been revised upwards, from 1.1% to 1.2%. This is the fastest quarterly growth in the UK since 1999. However, the economy had contracted by more than 6% before this.A large part of this growth is made up of inventory building by companies, therefore it is presumed not necessarily to be sustainable.Ed Balls, a Labour leadership candidate, used the revised figures to warn of an economic hurricane hitting the UK if the government cuts public...

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GDP Revised Lower to 1.6%

From the BEA:Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 1.6 percent in the second quarter of 2010, (that is, from the first quarter to the second quarter), according to the "second" estimate released by the Bureau of Economic Analysis....

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Yesterday's Market

After gapping higher at the open, prices broke the trend line started yesterday (a). They found support at previous lows (b) and tried breaking out but found resistance at the EMS (C). Even getting above the EMA couldn't give prices enough momentum, so they fell through support (e). When momentum shifter (f) prices rose but found resistance...

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A Look At the Value Line Average

Reader "R" asked the following question yesterday:Have you noticed that Valueline Arithmetic is currently correcting from a high it made earlier this year? That recent peak was an all time high, and therefore was higher than the peak before the 2008-2009 crash. The Drawdown from this recent peak is approximately 15%. What do you make of this...

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