Archive for April 2019

In 2005, sales of drop-tops peaked at 344,000, 2% of sales. During the recession sales collapsed and haven’t recovered. In 2014, sales were 124,000 and are on pace to hit just 86,000 this year, half-a-percent of total vehicle sales. Sales have cratered because sales of 4-door sedans have collapsed, and because car bodies and frames…

GDP 19Q1 GDP came in at a remarkably strong 3.2%; don’t be deceived. Growth was pushed up by an unsustainable surge in inventories, a huge one-time jump in state and local government spending, and a drop in imports precipitated by a rise in 18Q4 imports in advance of Chinese tariffs that never materialized. That said,…

The Friday File: As of today, James Holzhauer has won 17 straight regular Jeopardy! games and in the process has amassed a staggering $1,275,587. He holds the top seven single-game winnings records, the highest being $131,127. At $60,000, he holds the record for the largest successful Daily Double wager. He trails just Ken Jennings in…

In 2005, the share of the labor force working in non-standard arrangements was 10.9%. In 2017, despite the “sharing economy” the percentage declined to 10.1%! Within non-standard arrangements, the percentage of independent contractors fell from 7.4% to 6.9%, on-call workers declined from 1.8% to 1.7%, while temp agency and contract company workers were unchanged at…

Over the past few decades new firm creation has declined, as have job gains attributable to new firms. Similarly, profit margins have risen, especially for the top 10% of global firms. Why? A substantial decline in knowledge diffusion from new, innovative firms to laggards due to patent concentration increasing among firms with the most patents.…

March housing starts eased to 1.139 million, the weakest data since 5/17, down 14.2% compared to 3/18, and down 9.7% YTD. Part of the apparent softness is because starts were particularly strong through 5/18. However, it is still somewhat surprising given lower rates and a very strong labor market. I suspect some of the weakness…

First time claims for unemployment benefits fell to 192,000 in the week ending 4/13, their lowest level since 9/69, while the less volatile four-week moving average fell to 201,250, the lowest level since 11/69. When unemployment claims hit their cyclical lows in 1/89, 4/00 and 1/06, a recession occurred in 18 months, 11 months and…

The Friday File: In 1995, 2% of couples met online, today it’s 39%. Meeting in bars went from 19% to 27%. Other methods have significantly declined. Meeting through friends has fallen from 33% to 20%, meeting through coworkers has dropped from 19% to 11%, meeting through family has tumbled from 15% to 7%, meeting in…

While hardly surprising, the IMF cut its forecast of 2019 global economic growth to 3.3% from 3.5% in January; 3.7% in October. A key reason; world trade, which had been growing at 5%/year for a long time, slowed to 3.8% last year and is forecast to grow just 3.4% in 2020. Advanced economies will slide…

In March, Chinese lending activity hit its highest level in a decade, the money supply is now growing at its fastest pace in a year, and exports have completely recovered from their dismal December. Thus, the stock market is up 33% YTD, and 10-yr Chinese Government bond yields have jumped from 3.1% to 3.4% as…