From Bloomberg today:
Two measures of U.S. economic performance unexpectedly turned positive in December...The National Association of Realtors said sales of existing homes rose 6.5 percent to an annual rate of 4.74 million last month, propelled by the biggest slump in prices since the Great Depression. The Conference Board’s index of leading economic indicators increased 0.3 percent as the supply of money expanded.
I won't gloat. I'll just hyperlink.
But, but, but....What about continued, massive job losses? Again, from Bloomberg:
Analysts said the indicators...needed to be viewed against the backdrop of surging firings -- 72,500 announced today alone [including from Catepillar, Sprint and Home Depot]. The job losses, they said, may deepen the pullback in consumer spending and make banks more reluctant to lend, exacerbating what’s already the longest recession since 1982.
“We are not out of the woods yet by any stretch,” said Jonathan Basile.
Duh. Payroll trends always lag behind the economy's ups and downs. The economy faces a terrible hangover from a long debt binge, serious tailwinds and even more serious risks from national capitals everywhere (see bad economic policy from governments). Employers will want confirmation things are stabilzing and are headed up before they stop retrenching and start hiring again -- especially before they start hiring full-time again.
By the time we're "out of the woods," the improved reality will be obvious to everyone and the best profit opportunities will be gone. There's no value added in asserting what is plain for all to see. There is value added in pointing out what many do not yet see.
There was no inflation in 2008 -- the first year for which this has been the case since 1954. This report has served to further inflame speculation that a deadly deflation spiral is upon us. Meanwhile, the Fed's separate report on industrial production in the US shows manufacturing is still nosediving. US factories, mines and utilites are operating at only 73.6% capacity -- that's a 26-year low, with the multi-month slide in capacity use rate also the most pronounced in 26 years. And like the stock market's resumed slump, this one has much more the look of a determined rot than the Arab-oil-influenced, up-and-down, V-shaped bounce in the early 1980's. It's not an oil spike, but a 20+ year self-inflicted debt binge that's behind our problems this time. This is bad.