- by New Deal democrat
Monthly data released last week were sparse, but included a substantial increase in December factory orders, Productivity in the 4th quarter decreased, and unit labor costs increased. Consumer credit increased, and wholesale inventories decreased.
This week continued to give some indications that tax increases may be affecting the economy. So Let's start this look at the high frequency weekly indicators by checking what is happening with tax withholding:
Daily Treasury Statement tax withholding
- $137.6 B (adjusted -13.1% for 2013 payroll tax withholding changes) vs. $146.5 B, -6.2% YoY last 20 days. The unadjusted result was $158.1 B for a 7.9% increase.
- 366,000 down 2,000
- 4 week average 350,500 down 1,500
- unchanged at 89 w/w up 2.5% YoY
I am adjusting my YoY tax withholding figures to reflect the increase in personal withholding taxes. While the YoY collections are up substantially, they should be up over 15% to compesnate for the tax increase. Since I can think of no reason why employment itself should have fallen off a cliff in January, it is very possible that there is a lag in the payment of withholding taxes with the new increase. In fact, the rolling 20 day average this week is much better than the average was last week compared YoY. If this hypothesis is correct, I would expect tax withholding to be much more reliable by the end of February.
- ICSC +2.4%%% w/w +2..6% YoY
- Johnson Redbook +1.5% YoY
- Gallup daily consumer spending 14 day average at $80 up nearly $20 YoY
- YoY this week. +2.6%
Real estate loans, from the FRB H8 report:
- 0.3% w.w
- +1.3% YoY
- +2.9% from its bottom
- +2% w/w purchase applications
- +16% YoY purchase applications
- +4% w/w refinance applications
Interest rates and credit spreads
- +0.13% to 4.85% BAA corporate bonds
- +0.12% to 2.02% 10 year treasury bonds
- +0.01% change at 2.83% credit spread between corporates and treasuries
- +0.4% w/w
- +1.1% m/m
- +10.5% YoY Real M1
- +0.1% w/w
- -0.4% m/m
- +5.3% YoY Real M2
Oil prices and usage
- Oil $95.72 down $2.05 w/w
- gas $3.54 up $.18 w/w
- Usage 4 week average YoY +4.7%
- -9800 or -3.4% carloads YoY
- +1800 or +0.6%% carloads ex-coal
- +16,600 or +7.2% intermodal units
- +6,800 or +1.3% YoY total loads
- 9 of 20 types of carloads up YoY, a decrease of 1 from last week
- Harpex up 7 at 366
- Baltic Dry Index down 10 to 748
Bank lending rates
- 0.225 TED spread down -0.015 w/w
- 0.2000 LIBOR down -0.006 w/w
JoC ECRI Commodity prices
- up 0.02 to 129.91 w/w
- +2.15% YoY
By far the most negative data was tax withholdings, although these were not so bad as last week. Temporary jobs also stalled, and initial claims are back in their 2012 range. Bond interest rates and spreads are also increasing. Money supply, while positive, is near the lower end of its range.
Continuing positives include the housing market, money supply, consumer spedning, bank lending rates, and commodity prices. Gas prices, while rising, haven't turned constrictive yet. Gas usage has turned positive. Rail traffic is also positive again.
If austerity measures emanating from Washington are enough to tip the economy into contraction, the evidence should accumulate in the next few weeks. While there is some evidence of a consumer and employment slowdown, most of the high frequency data continues to support economic expansion.
Have a nice weekend.