Weakness on Both Sides of the Atlantic

February 5, 2009

Everyday brings more evidence of the global recession’s severity.  Today’s data were extraordinarily dire and bear special mention.

  1. German industrial orders plunged 49.6% at a seasonally adjusted annual rate last quarter from the 3Q level, with similar drops of 53.5% saar in foreign demand and 45.3% in domestic demand.  A 47.2% drop in domestic orders for capital goods points to substantial cutbacks in business investment and industrial production.
  2. British car sales were 30.9% lower in January than a year earlier.
  3. Canadian building permits were 28% lower in December than in September. The Canadian IVEY-PMI index, a composite of both manufacturing and service-producing sectors, fell to 36.1 in January from 52.2 in October and 56.2 a year ago.
  4. U.S. factory orders were more than 15% lower in December than in September.
  5. Following an earlier pattern of alternate months of leaping and consolidating growth, new U.S. jobless claims averaged 582.25K in the four weeks to January 31st, 55.75K and 10.6% more than during the previous four-week period.  Similarly, new jobless claims averaged 541K in the four weeks to December 6th compared to 491K in the four weeks to November 8, 484.75K in the four weeks to October 11 after 445.75K in the four weeks to September 13, and 446K in the four weeks to August 16 versus 381.75K in the four weeks to July 19th. The worst labor market numbers lie ahead, not behind.  Partisan politics in Washington is poisoning a very bad situation further.

Copyright 2009 Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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