April 27, 2015

Not News: Baltimore Mayor Says ‘Protesters’ Who Wish to Can Have ‘Space’ to ‘Destroy’

At a Sunday press conference, Baltimore Mayor Stephanie Rawlings-Blake told reporters that she and the law enforcement in the city she runs have a de facto responsibility, in the name of “balance,” to give “space” to “destroy” to “protesters” who have such a desire.

This obviously newsworthy pull quote condoning property destruction is not present in coverage at the Associated Press’s main national site, in several stories where her comment could have been mentioned at the wire service’s “Big Story” site, or in two additional stories at the New York Times containing Sheryl Gay Stolberg’s byline. Video and a transcript follow the jump.

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April 24, 2015

AP’s Crutsinger Ignores Recession Red Flag, But Predicted Recession 30 Years Ago Based Only on a Survey

Today’s Census Bureau report on durable goods orders was like a poorly made cake with delicious frosting: tasty at first, but awful when fully experienced.

The frosting in today’s report was that overall orders increased in March by a seasonally adjusted 4.0 percent. The trouble is that an important, widely recognized element of that report — what the Associated Press’s Martin Crutsinger vaguely described as “a key category that serves as a proxy for future business investment” — came in with yet another minus sign. That category’s 0.5 percent decline, though noted, had far more significance than Crutsinger gave it.

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Rush Limbaugh Wonders How CNN and MSNBC Can Still Be on the Air; Here’s How

Rush Limbaugh posted an interesting pair of questions at his web site yesterday: “How can CNN still be on the air with no audience? How can MSNBC have been on the air with no audience? In the old days, they’re gone, kaput. Something else is tried. But they stay. And they double down on what they’re doing that’s losing audience.”

A large part of the answer, as I noted on March 30, is that those two networks apparently have suffered very little financially as they have lost audience. That’s because, as is apparently the case with most of the major cable channels, their primary source of revenue comes from “subscriptions,” also referred to as “carriage fees” or “license fee revenues.” In plain English, cable channels get paid a great deal of money even if nobody watches them, and don’t benefit as much as would be expected when their audience grows.

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April 23, 2015

At AP, Report on New-Home Sales ‘Collapse’ Argues For a ‘Bounce Back’

The Census Bureau reported today that sales new homes in the U.S. (seasonally adjusted at an annual rate) plunged sharply in March to 481,000 after hitting a seven-year record level of 543,000 in February.

As has been the case so often, AP reporter Josh Boak didn’t look past the seasonally adjusted numbers, and as a result gave the “expert” he quoted a free pass to supply sunnyside-up commentary in his mid-day Wednesday dispatch. He also shakily claimed that “winter storms” were a “likely” major impediment to March sales (bolds are mine):

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Initial Unemployment Claims (042315): 295K SA; Raw Claims 7 Percent Below Same Week Last Year

Filed under: Economy,Taxes & Government — Tom @ 8:24 am

Predictions: At Yahoo’s Econ Calendar — Briefing.com expects 285,000 seasonally adjusted claims, while “Markets” expect 288,000.

The report will be here at 8:30.

HERE IT IS:

SEASONALLY ADJUSTED DATA

In the week ending April 18, the advance figure for seasonally adjusted initial claims was 295,000, an increase of 1,000 from the previous week’s unrevised level of 294,000. The 4-week moving average was 284,500, an increase of 1,750 from the previous week’s unrevised average of 282,750.

UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 279,097 in the week ending April 18, a decrease of 28,102 (or -9.1 percent) from the previous week. The seasonal factors had expected a decrease of 29,369 (or -9.6 percent) from the previous week. There were 299,182 initial claims in the comparable week in 2014.

There was a significant difference in the seasonal adjustment factors (94.6 this week, 90.7 for same week last year). Last year’s comparable week was the week before Easter, but I don’t see the fact that this year’s week didn’t have Easter as justifying such a big change. Seasonally adjusted claims would have been 308,000, or 13,000 higher, using last year’s factor; I’d split the difference and say that today’s figure “should” have been a bit over 300,000.

Though it’s too early to get overly concerned, the overall trend here is not in a very favorable direction.

April 22, 2015

Press Takes to Calling Japan’s Most Recent Very Real Recession ‘Technical’

So when is a recession not a genuine recession? Apparently when it’s “technical.”

Unfortunately, the term “technical recession” appears to be well on the way to devolving into what has long been considered the real definition of a recession for the purpose of discounting its validity.

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April 20, 2015

Minneapolis Star Tribune Reporter Bemoans ‘Youth Exodus,’ Doesn’t Mention Taxes

Minneapolis Star Tribune reporter Jackie Crosby’s writeup on how “Minnesota has been losing residents to other states” since 2002, and that it’s especially troubling because “young adults are leaving in the greatest numbers,” contained an enormous blind spot.

The Gopher State, aka the Land of 10,000 Lakes, is also sardonically known as the Land of 10,000 Taxes by many residents, and with good reason. Yet the only time the word “tax” appeared was in a sentence discussing the need for “robust tax rolls.”

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April 19, 2015

‘Failed’ Gwyneth Paltrow Was Actually on Track to Succeed in ‘Food Stamp Challenge’

As yours truly noted on April 12, actress Gwyneth Paltrow made a bit of a splash earlier this month when she announced that she would add her name to the list of ignorant politicians, advocates and celebrities taking on the deceptively designed “Food Stamp Challenge.”

The idea is to “try to survive” eating for a week on the average benefit a Supplemental Nutrition Assistance Program (SNAP) recipient receives. The objective is to prove that it really can’t be done, thereby “proving” that food stamp benefits are too low. Of course, that’s what Paltrow claims occurred, with MSNBC.com hyping how she “succeeded by failing.” As was the case with an Indiana journalist several months ago, based on the spending figure Paltrow herself disclosed, she was not failing at all. Based on how the program really works, she would have succeeded had she stuck with it.

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April 17, 2015

Reported on Wednesday: Industrial Production Declines

Filed under: Economy,Taxes & Government — Tom @ 9:37 am

From the Federal Reserve (bolds and paragraph breaks added by me):

Industrial production decreased 0.6 percent in March after increasing 0.1 percent in February.

For the first quarter of 2015 as a whole, industrial production declined at an annual rate of 1.0 percent, the first quarterly decrease since the second quarter of 2009. The decline last quarter resulted from a drop in oil and gas well drilling and servicing of more than 60 percent at an annual rate and from a decrease in manufacturing production of 1.2 percent.

In March, manufacturing output moved up 0.1 percent for its first monthly gain since November; however, factory output in January is now estimated to have fallen 0.6 percent, about twice the size of the previously reported decline. The index for mining decreased 0.7 percent in March.

… At 105.2 percent of its 2007 average, total industrial production in March was 2.0 percent above its level of a year earlier. …

Here’s a grim graphic capture of portions of the Fed’s main table:

IndustrialProductionMarch2015

Where, other than potential government “creativity,” is first-quarter positive GDP going to come from?

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UPDATE: The Atlanta Fed’s 1Q15 estimate, after all of this week’s machinations, is back to 0.1 percent annualized, after increasing a tiny bit earlier in the week. Moody’s is basically unchanged at 1.0 percent to 1.2 percent.

April 16, 2015

Housing: Starts Down (Two Straight Months of Year-Over-Year Decline); Permits Up

Filed under: Economy,Taxes & Government — Tom @ 9:07 am

Today’s report on new home construction had more bad news on housing starts, and modestly good news about permits:

BUILDING PERMITS

Privately-owned housing units authorized by building permits in March were at a seasonally adjusted annual rate of 1,039,000. This is 5.7 percent (±2.0%) below the revised February rate of 1,102,000, but is 2.9 percent (±0.9%) above the March 2014 estimate of 1,010,000.

Single-family authorizations in March were at a rate of 636,000; this is 2.1 percent (±0.9%) above the revised February figure of 623,000. Authorizations of units in buildings with five units or more were at a rate of 378,000 in March.

HOUSING STARTS

Privately-owned housing starts in March were at a seasonally adjusted annual rate of 926,000. This is 2.0 percent (±13.0%)* above the revised February estimate of 908,000, but is 2.5 percent (±11.5%)* below the March 2014 rate of 950,000.

Single-family housing starts in March were at a rate of 618,000; this is 4.4 percent (±12.3%)* above the revised February figure of 592,000. The March rate for units in buildings with five units or more was 287,000.

HOUSING COMPLETIONS

Privately-owned housing completions in March were at a seasonally adjusted annual rate of 823,000. This is 3.9 percent (±10.4%)* below the revised February estimate of 856,000 and is 5.8 percent (±10.2%)* below the March 2014 rate of 874,000.

The raw data for starts shows two straight years of decline in February and March:

HousingStartsNSA0105to0315

I don’t think we’re going to see much positive help from Residential Construction in the 1Q15 GDP report.

Initial Unemployment Claims (041615): 294K SA; Raw Claims Top 300K, Only 3.5% Lower Than Same Week Last Year

Filed under: Economy,Taxes & Government — Tom @ 8:42 am

From the Department of Labor:

SEASONALLY ADJUSTED DATA

In the week ending April 11, the advance figure for seasonally adjusted initial claims was 294,000, an increase of 12,000 from the previous week’s revised level. The previous week’s level was revised up by 1,000 from 281,000 to 282,000. The 4-week moving average was 282,750, an increase of 250 from the previous week’s revised average. The previous week’s average was revised up by 250 from 282,250 to 282,500.

UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 307,500 in the week ending April 11, an increase of 53,967 (or 21.3 percent) from the previous week. The seasonal factors had expected an increase of 41,129 (or 16.2 percent) from the previous week. There were 318,793 initial claims in the comparable week in 2014.

Those tempted to dismiss the seasonally adjusted increase from last week still have to recognize that this is the first week with a raw claims number above 300,000 since late February, and that raw claims spiked significantly from the previous week. Since few government offices closed on Good Friday (April 3), I don’t think anyone can claim that there was much of a carryover to the week ended April 11 covered in today’s report.

Today is an indicator of deterioriation which is unfortunately consistent with the disappointment March employment report.

April 15, 2015

The Potemkin Economy

The press has hidden it for months.

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This column went up at PJ Media and was teased here at BizzyBlog Sunday evening.

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The disappointing March employment report the government released on April 3 finally forced the business press to ‘fess up to the truth, best summed up in words found at the Associated Press“For months, the U.S. economy’s strength has been flagging.”

That admission takes “too little, too late” to a whole new level.

During the past several months, business scribes and broadcasters have largely pretended that all is well, constructing and maintaining a Potemkin-like facade of a prosperous economy, even as the vast majority of hard-number economic indicators turned in performances ranging from middling to awful. To prop their false image up, they concentrated most of the commerce-related news they delivered to low-information voters and low-awareness news consumers on the job market, the economy’s one supposedly strong area, and positive consumer and corporate sentiment surveys.

After the strong economic growth seen during the second and third quarters of last year, the AP, aka the Administration’s Press, has been especially odious in insisting that the economy is still really “robust,” while coming just inches short of declaring that President Barack Obama’s economic critics should be cowering in the corner in shame. Until Friday, the shouting only got louder as the underlying data deteriorated further.

On February 20, the wire service’s Jim Kuhnhenn admired how Obama was “taunting Republicans” over the economy. Devoid of any sense of historical irony, Kuhnhenn described an “economic recovery showing signs of taking hold” — over 5-1/2 years after the recession officially ended.

When Kuhnhenn wrote his love letter, we had already seen:

  • Seasonally adjusted annualized fourth-quarter growth of 2.6 percent, barely half that reported in the previous quarter. That figure was revised down to a mediocre 2.2 percent just a week later. Given the next several items which follow, that revised figure still seems high.
  • Steep November and December declines in durable goods orders totaling over 5 percent.
  • Sharp consecutive drops in December and January retail sales.
  • A microscopic two-month advance of less than 0.2 percent in November and December construction spending.
  • December slippages in both real and current-dollar personal consumption expenditures.

Not to be outdone, five weeks later, the AP’s Martin Crutsinger composed a veritable hosanna of dishonest praise directed at Dear Leader’s economy, which he described as “sluggish,” but “one of the most durable since World War II.”

Crutsinger removed all doubt over whether he was bearing false witness when he wrote the following:

The current expansion will mark its sixth anniversary in June, meaning it will have already lasted 14 months longer than the average expansion since the end of World War II.

In referring to “months,” Crutsinger pretended that the economy has continuously expanded since the recession’s end. It hasn’t:

GDPquarterlies1Q09to4Q14

The previous expansions to which the AP writer referred were legitimate, because they were uninterrupted. By contrast, as seen above, the economy has contracted twice since the recession’s end. Its current winning streak is only three quarters. Therefore, despite what Crutsinger wrote, there will be no six-year anniversary to “mark” in June — and he has once again demonstrated why the National Review’s Kevin Williamson was correct in calling him the nation’s “Worst Economics Writer” two years ago.

Until that March employment report, the economy had indeed added an impressive-sounding seasonally adjusted 200,000 or more payroll jobs per month for 12 months. Though it’s a nice round number and the best such streak in 15 years, it’s still not particularly strong in historical context. More importantly, it remains far from what’s required to get discouraged and disengaged Americans on the sidelines who want to work back to work, or searching for more financially rewarding work.

As seen below, the post-recession Reagan economy of the 1980s, during which the Gipper did all of the things which Obama and his Keynesian cadre insist “don’t work,” after adjusting for the size of the workforce, more than doubled the job-creating performance seen during the Obama post-recession era:

ReaganVsObamaGraphicsThru69mos

By the time Crutsinger produced his false, fawning crud, there had been further weakening in durable goods orders and shipments, all factory orders and shipmentsconstruction spending, and retail sales. All of this has caused economists to write down their estimates of first-quarter growth to as low as the annualized 0.1 percent seen at the Atlanta Branch of the Federal Reserve as of late last week. Even the incurable optimists at Moody’s were only expecting 1.1 percent on April 3.

The March employment news was so bad that the Potemkin curtain had to be lifted. Instead of the 250,000 payroll jobs “experts” predicted — one particularly well-known analyst actually thought we would see almost 300,000, and that it would mark the beginning of several “even faster gains … in the spring”  — the government’s jobs report showed only 126,000 payroll jobs added in March accompanied by 69,000 in combined reductions to January and February. Far more damning, despite the nominally low unemployment rate of 5.5 percent, the job market’s malaise indicators got worse. The civilian workforce actually shrunk, and the labor force participation rate sank back to a 37-year low.

The cumulative effect of monthly declines have brought some year-over-year comparisons into negative territory, particularly in durable goods and total factory orders. Logically, this would seem to dictate that the producing side of the economy has given up all of the gains seen last spring and summer and reverted back to where it was last winter — or worse.

If that’s really true, first-quarter GDP, absent a strong surge in consumer spending which no one expects, seems destined to come in with a minus sign.

The only thing which seems more certain is that Marty Crutsinger and the other propagandists at the Associated Press will continue to pretend that we’re in the midst of a six-year expansion.

April 14, 2015

Bloomberg, AP Sharply Differ in Evaluating Ominous March Retail Sales Report

Today, the Census Bureau reported that retail sales in March increased by a seasonally adjusted 0.9 percent. While that was the first such positive figure in four months, it was less than the 1.1 percent increase analysts expected, and did little to calm fears that the economy contracted during the first quarter of 2015.

An unbylined report at Bloomberg News and a dispatch from Josh Boak at the Associated Press had sharply differing takes on what the result meant. Longtime readers probably won’t have a difficult time guessing who had the bigger set of blinders on.

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CNN, While Showing a ‘Vintage’ Car: ‘See Cuba Before American Investors Ruin It’

Journalists’ and leftists’ (but I repeat myself) misguided love for Cuba goes back decades. Y’know, free healthcare (cough), yada-yada.

Now that President Obama is unilaterally changing the relationship between the two nations, and as usual getting nothing in return, you’d think that they’d be happy. Heck no. It started several months ago when Fox News’s Shepard Smith fretted about how a thaw in U.S.-Cuban relations might “ruin the place,” and has been echoed in many quarters since then. Early today, CNN International went over the top, essentially communicating in one picture their concern that the changed situation will “ruin” what has already been ruined:

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In Low-Visibility Report, AP’s Crutsinger Masks Spike in Govt. Spending

Late Monday afternoon, the Associated Press’s Martin Crutsinger produced a typically dodgy dispatch on the government’s Monthly Treasury Statement. The Treasury Department released the March version of that report covering the first six months of the current fiscal year early Monday afternoon.

The odd thing is, while it has been published elsewhere at the web sites of certain of its subscribers, a search on “budget deficit” (not in quotes) at the wire service’s national site indicates that it’s not present there at all. The national site’s only mention of March’s deficit is in the sixth of 13 listings at a “Business Highlights” summary. It reads as follows (bolds are mine throughout this post):

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