Happy Independence Day!
During the 2012 Presidential campaign President Obama said, “The private sector is doing fine,” which was immediately jumped on by his erstwhile opponent Republican Tea Party (GOTP) 2012 presidential footnote, Willard Mitt Romney, who replied, “I think he’s really defining what it means to be out of touch with reality.”
Now almost two years later clearly the economy is in recovery and the following indicators show the private sector is indeed “doing fine”, and all the info – by-the-way – comes from FOX Business:
First Quarter earnings: Citicorp reported $20.1 billion and Coca-Cola reported $10.58 billion
Following are fourth quarter 2014 earnings: FedEx reported $11.8 billion
Consumer Goods:
The Labor Department reports prices for consumer goods rose 0.4% in May from the month prior, the largest increase since February 2013, and more than the 0.2% increase Wall Street expected. Excluding the food and energy components, prices were up 0.3%, also above economists’ expectations of 0.2%, and the largest increase since August 2011.
Home Sales:
The Commerce Department reports sales of new single-family homes hit the highest level since May 2008, soaring 18.6% in May to an annualized rate of 504,000 units, beating analyst estimates for 440,000 units, and marking the biggest increase since January 1992.
Home prices in 20 major U.S. metropolitan areas rose 1.1% in April from March on a non-seasonally adjusted basis, more than the 0.8% economists expected, according to a closely-watched gauge from S&P/Case-Shiller. From the same period in 2013, prices rose 10.8%, a shallower increase than the 11.6% gain Wall Street was looking for.
The National Association of Realtors reports sales of existing single-family homes rose 4.9% in May to an annualized rate of 4.89 million units, more than the 4.73 million units economists expected.
The National Association of Realtors reports signed contracts to buy previously-owned homes jumped 6.1% in May, the biggest gain since April 2010, higher than the 1.5% increase Wall Street anticipated.
The Commerce Department reported starts of new home construction jumped 13.2% in April to an annualized rate of 1.07 million units, more than the 980,000 starts Wall Street anticipated for the month. Permits, meanwhile, rose 8% to an annualized rate of 1.08 million in the same month, the highest rate since June 2008. Wall Street was expecting a slightly lower number of 1.01 million.
The Commerce Department reported starts of new home construction rose 2.8% in March to an annualized rate of 946,000, short of expectations for an increase to 973,000. Permits fell 2.4% in the same month to an annualized rate of 990,000, also below Wall Street views of a drop to 1.01 million.
Manufacturing:
A gauge of U.S. manufacturing activity from the Institute for Supply Management fell to 55.3 in June, from 55.4 in May, missing Wall Street estimates for an increase to 55.8. Readings above 50 point to expansion, while those below indicate contraction.
The Philadelphia Fed’s gauge of manufacturing activity in the mid-Atlantic region rose to 17.8 in June from 15.4 in May, surpassing Wall Street expectations for a fall to 14. The reading was the highest since September.
Unemployment:
The U.S. economy added 288,000 jobs in June, far surpassing the 212,000 jobs Wall Street expected. The unemployment rate for the month fell to 6.1%, lower than expectations it would remain at 6.3% from May. The labor force participation rate, meanwhile, remained unchanged at 62.8%.
According to payroll processor ADP, the U.S. private sector grew by 281,000 jobs in June, widely beating Wall Street estimates for an increase of 200,000.
The number of Americans filing for first-time unemployment benefits fell the week of 13 June 2014 to 312,000 from an upwardly revised 318,000 the week prior. Wall Street expected claims to fall to 314,000 from an initially reported 317,000.
The U.S. economy added 288,000 jobs in April, surging past the 210,000 jobs Wall Street expected, marking the biggest increase since January 2012. The jobless rate fell by 0.4 percentage point to 6.3%, its lowest level since September 2008. The labor force participation rate fell to 62.8% from 63.2% in March.
Stock Market:
At Thursday’s closing bell the broad S&P 500 was up at 1,985.44, the Dow closed up at 17,068.26 and the Nasdaq finished off at 4,485.93. When the President was sworn in the S&P 500 was at 831.95, the Dow stood at 8,077.56 and the Nasdaq was hovering at 1,477.29.
So, let’s see, even though the 2012 GOTP presidential footnote claimed President Obama was defining what it meant to be “out of touch with reality” it appears it was he – Willard Mitt Romney, and the entire corps of conservative talking heads – who appears to have defined it. The economy continues to improve, no thanks to the GOTP obstructionists in Congress, and all signs point to it continuing to improve.
The Liberty Tree 