Big miss on PMI

Just to show you what a totally muddled economic picture we’ve got, the Purchasing Manager’s Index (PMI) contracted sharply today contrasting with last week’s “happy news” about an unexpected increase in GDP.

Still, the PMI miss wasn’t much of a surprise to me. The monthly series is fairly volatile so the chart above [...]

Here comes the recession

When trying to forecast the markets one indicator I like to look at is durable goods. A clear proxy for future factory activity, durable goods help us understand how much activity businesses are seeing and in turn can be used to infer possible unemployment and even gross domestic product, GDP. In other words, durable [...]

Is the US already in recession?

One of the indicators that I like to watch is the Institute for Supply Management Purchasing Managers Index (PMI) due to its clarity and relative simplicitly. The PMI is composed of five indicators of the economic strength of the manufacturing sector: production, inventories, deliveries, new orders and employment. Interpretation is very simple: a metric [...]

PMI is contracting and The Fed can’t cut no more

With yesterday’s reporting of Purchasing Managers Index (PMI) numbers from China, Europe and The United States, the coordinated recessions I’ve previously written about seem more and more likely every day. I because curious about the relationship between PMI and recessions so started looking into the data a little more throughly. The chart above shows [...]