Housing prices are booming, stocks are staying afloat despite rapidly deteriorating domestic and international economic fundamentals for one reason and one reason only, the Federal Reserves zero interest rates policy–all unsustainable trends end, this one will end disastrously. This is why there is panic in the halls of capital. There is no exit, none. Collapse and financial destruction are coming with only one response left for the elites–and it will be an authoritarian, coercive and police enforced loss of the economic sovereignty of the people of this nation, what little left they think they still have. Cash will, as planned log ago, be outlawed, totally monitored , centrally controlled digits will be king instead–some King. If you do not own some physical gold, despite the fact that eventually too they will come for that as well as they have in the past when the Constitution was still a hell of a lot fresher than it is today, you are will certainly regret it. And very soon. Just today’s headlines from Zero Hedge–it does bear to remember that all governments lie and ours is lying more than it ever has before, thus anyone who trusts even these inescapably bad numbers and those over the past months is a fool. Trust is 4-letter word.
After a very modest bounce in April, Philly Fed fell again in May, printing a disappointing 6.7 (against 8.0 expectations). Philly Fed has now missed 5 of the last 6 (and 7 of the last 9) months. While new orders picked up, prices paid plunged at recessionary pace, inventories tumbled, and the average workweek slumped. Hope also tumbled as future expectations dropped.
Consumer Comfort is now the lowest it has been since Dec 2014 as Bloomberg’s sentiment index continues to track the pain of higher gas prices better than the gain of higher stock prices. This is the biggest 6-week plunge in sentiment since Oct 2013. What is more worrisome is ‘hope’ is plunging. Economic Expectations fell by the most since Oct 2013 – the government shutdown – having fallen for 3 straight months. It appears the trickle-down popularity of seeing a Green Dow print every night on the news does not make the average joe feel any better about the world after all???
Having dipped and missing by the most on record in April, Markit’s US Manufacturing PMI printed 53.8 (against expectations of 54.5). This comes on the heels of weakness in European PMIs (especially Germany – but but but lower EUR… exports, growth, etc…) andChinese PMIs. This is the lowest US Manufacuring PMI since Jan 2014 (in the middle of the polar vortex). May saw the slowest rise in new orders since Jan 2014 – but the post-weather rebound? – and input costs rrise for the first time in 2015. Markis now carefully noting that “the survey is likely to encourage policymakers to err on the side of caution.”
Initial claims rose very modestly this week but the smoother 4-week average hit fresh cycle lows at 271k – just shy of the lowest level since 1973. Continuing claims also fell to new cycle lows at their lowest since 2000. It appears, as we have noted previously, that peak job-related cost-cutting has been achieved. However, it’s not all unicorns and ponies… as Chicago Fed National Activity Indicator printed a disappointing -0.15, the 4th month in a row of contraction.