Business Cycle Indicators as of Mid-September

Industrial production suprised on the upside on Friday, 0.4% vs. 0.1% Bloomberg consensus. Here’s the picture of key indicators followed by the NBER BCDC, plus monthly GDP.

Figure 1: Nonfarm payroll employment, NFP incorporating preliminary benchmark (dark blue), civilian employment (orange), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), consumption in Ch.2012$ (light blue), and monthly GDP in Ch.2012$ (pink), GDP (blue bars), 2023Q2 is GDPNow of 8/31, all log normalized to 2021M11=0. Source: BLS via FRED, BLS preliminary benchmark, Federal Reserve, BEA 2023Q2 second release via FREDb, S&P Global/IHS Markit (nee Macroeconomic Advisers, IHS Markit) (9/1/2023 release), and author’s calculations.

Note that the Lewis-Mertens-Stock/NY Fed Weekly Economic Index indicates a modest reacceleration in growth (to 1.88% year-on-year), using data through September 6.


11 thoughts on “Business Cycle Indicators as of Mid-September

  1. pgl

    Rudy Giuliani too cheap to pay his lawyers?

    Rudy Giuliani’s former lawyer sued him Monday, alleging the ex-New York City mayor has paid only a fraction of nearly $1.6 million in legal fees he’s racked up from investigations into his efforts to keep Donald Trump in the White House. Robert Costello and his law firm, Davidoff Hutcher & Citron LLP, say Giuliani has paid them just $214,000 and still has a $1.36 million tab. Giuliani’s last payment, according to the lawsuit, was $10,000 on Sept. 14 — about a week after Trump hosted a $100,000-a-plate fundraiser for Giuliani at his Bedminster, New Jersey, golf club. Costello and the firm say Giuliani, once celebrated as “America’s mayor” for his leadership after the Sept. 11, 2001, attacks, breached their retainer agreement by failing to pay his invoices in full in a timely fashion. They seek full payment of his unpaid bills, as well as costs and fees stemming from their efforts to get him to pay up. “I can’t express how personally hurt I am by what Bob Costello has done,” Giuliani said Monday in a statement provided by his spokesperson. “It’s a real shame when lawyers do things like this, and all I will say is that their bill is way in excess to anything approaching legitimate fees.”

    1. Moses Herzog

      When you have large numbers of East Indian people washing their clothes in river water containing animal (and probably human) feces, it’s amazing these things don’t happen more often. China loves shoving scores of diseased (dead) pigs into large bodies of water (instead of, say for example, doing an open burning of the animal corpses). I wonder where exactly they think that leads?? It’s real “rocket science” of course.

      Have more children and worship some cows, surely something good will eventually happen.

  2. Macroduck

    A little shutdown speculation, given that D.C. types now say a shutdown is unavoidable –

    The figure I’ve heard for unpaid layoffs in a federal shutdown is roughly one million workers. That’s out of a (non-farm) total of 156 million. Federal workers earn 76 cents for every dollar earned by an equivalent private worker. So ignoring jobless benefits, that’s something like just under 0.5% of worker pay that will be interrupted for however long the federal government may be shut down. Similar things will happen to contractors, so probably more than 0.5%.

    Zandi’s estimate of output drag from the auto strike is 0.02%, if memory serves. So a government shutdown is a bigger hit to incomes than the auto strike. The two would be additive in their effect on incomes. Student loan payments restart next month – another drag on disposable income.

    People always dip into savings to smooth over this sort of interruption, so the hit to household spending will be a fraction of the hit to income. Student loan payments are semi-permanent, so the adjustment there won’t be offset from savings for very long. Cuts to spnding by the federal government will be partial, but here is no discretion – cuts are abrupt and complete in unprotected categories.

    Both government and the auto sector will be jerking workers around at a time when labor demand is still pretty healthy in other parts of the economy, so we’ll probably see some permanent losses of workers. My guess is that some government workers who qualify for pensions may jump to the private sector and double dip. Who needs the headache of interrupted income when you can have a guaranteed income? That would mean loss of experience, not what the federal government needs after the losses suffered after Trump played “Apprentice” with government workers.

    The auto strike is a Q3 issue, so far. Government shutdown is Q4, as is the student loan payment restart. If the auto strike ends around the beginnjng of Q4, it could offer a lift to GDP at about the time government becomes a drag. So while the damage from the two will be additive if they ovrlap, there is some chance restarting auto production will provide a tiny offset to the drag fro a government shutdown in Q4 GDP data.

    1. Moses Herzog

      @ Macroduck
      When this little lady, Lisa Desjardins. who I have high degree of respect for, says, gov shutdown is near unavoidable, we can take it to the bank. She didn’t run off during the Jan 6th treason at the U.S. Capitol. She planted her feet right there, and reported what was happening, as it was happening, in a dangerous environment. She has more dauntlessness and resolve than most male reporters. I think the gov shutdown is going to happen:

      You’re welcome to remind me I was wrong if the shutdown does not materialize later.

  3. pgl

    JohnH was jumping for joy when the Ukrainians lost one tank. Huh – he never mentioned this:

    ‘Capture That Tank!’: Ukraine’s Farmers Keep Stealing Russian Tanks with Tractors

    The war in Ukraine has been a nightmare for Russian President Putin as his forces have been crushed in countless battles. Much of that is due to the bravery of Kyiv’s forces and billions of dollars in Western military aid. And, of course, that means Ukraine has been very innovative and making sure it can steal any Russian military equipment it can and reuse.

    Time to Steal the Tanks with Tractors
    Back during one terrible week for Putin in March, Ukraine’s armed forces claimed that Russia had lost 21 tanks in a single day. In addition to the armored vehicles, Russian Forces reportedly lost nearly two dozen personnel carriers and eight artillery systems during one brutal day in March as well. In fact, it is widely believed that Moscow has lost more than 2,000 main battle tanks since the onset of its invasion of Ukraine last February. The London-based think tank the International Institute for Strategic Studies estimates that Russian Forces may have lost half of its fleet of modern tanks including the T-72B and T-72B3M and that “its inventory of T-80 tanks has been depleted by two-thirds.” While many of these armored vehicles were destroyed by weapons in combat, some were “stolen” by Ukrainian forces in an unexpected way – capture by a tractor.

    This was is horrific but only Putin can end his war crimes. But wait – if little Jonny boy did not get his daily dose of seeing Ukrainian children being killed, little Jonny boy would have nothing to live for.

  4. pgl

    Jeffrey Sachs used to be a good economist. Of late – he has turned into a nutcase. Yea Bloomberg pulled him off the air for good reason – blaming the US for that Nordstream explosion. And now this?

    “Our politicians are liars”: Jeffrey Sachs Says US Is in Decline and a Surly, Nasty Place
    Jeffrey Sachs, an economist, professor, and author, discussed the key differences between the happiest nations and the US. Americans are not happy The professor noted that Americans are “sliding,” adding that ten years ago, “we were 4th in the high-income world.” He continued, “This time, we are 21st.”

    Jeffrey acts as if he wants to be Trump’s campaign adviser. If so – he boy certainly is a liar. Now I checked on real GDP per capita over the past decade and it has grown as one would expect. Jeffrey asks how did we fall from 4th to 21st? Easy – a few other nations had faster real growth per capita than we did. An actual economist would celebrate that but not Jeffrey.

    1. Moses Herzog

      Sounds like Sachs acquired Peter Navarro Disease. If you’re an economist with your Master’s or above you need to wear an N-95 mask around those two, or you might get the Navarro Virus. Called “PN65” or its more commonly known moniker “Pee’n at 65” due to the age of those getting it, and that Navarro was Patient Zero.

  5. Macroduck

    Hiring talk from retailers for the holiday season is for fewer than last year:

    Last year, the seasonally adjusted total of retail workers fell in September, October and November:

    Since expected sales drive hiring, this ain’t a good look for Q4 PCE. Last year, November was particularly bad for core retail sales:

    This year’s early calls are for sales growth of half or a little better than last year’s growth:

    We could see a goose egg for GDP in Q4.

    1. Moses Herzog

      WSj is sure to have some “anecdotal” stuff on this retail hiring and retail blablabla between now and Thanksgiving. Will try to monitor, if my laziness can extend me anywhere past branch cutting and collecting before thunderstorms. It’s 50/50. You know it’s bad when you pick up two small branches and you’re looking around earnestly for the mayor in your backyard to give you the civic duty award. “Where did he go?? Huh?? Just these neighbor dogs barking???”

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