The Bowyer Briefing

Chicago Fed just said Manufacturing dropped in the midwest in August by a 1/3 pct. The culprit: autos plunged over 4%. That settles it, cash for clunkers didn’t increase growth, it just cleared auto company inventories.

 http://www.economy.com/dismal/pro/release.asp?edition=1&r=usa_cpmi&src=dd_immediate

Today we moved the bar again. First it was ‘create jobs’. Next it was ‘create or save jobs’. Now, it’s ‘only jobs that make a difference’.

On Frank Pastore on KKLA yesterday evening. We talked about this WSJ article below. FHA is making risky loans, the kind they spank bankers for. Here’s reality, bad credit risk borrowers are what they are: no amount of securitizing, bundling,… counter-party derivitive hedging of government guaranteeing can change that.

http://online.wsj.com/article/SB10001424052970204488304574428970233151130.html

Chain store sales have fallen since July. Yet, we will have a recovery in the third quarter. Why? Consumer spending does not drive growth. Supply, not demand is the key to recovery. J.B. Say wins again.

FHA says averarge mortgage rate down to 5.3%. No wonder houses are selling again. The money is coming from the Fed, not from the stimulus plan. This is Ben’s recovery.

http://www.fhfa.gov/webfiles/15008/September%20MIRS%20Sep%202009%20final.pdf

Color-coded world economic growth map. Here’s the key to interpretation: as in leisure suits, so in data – lime green is bad.

http://www.imf.org/external/datamapper/index.php

Germany finally gets some classical economics and some results. Only 200 years late.

“But indicators and surveys released in recent weeks suggest that the European economy is returning to growth.”

http://online.wsj.com/article/SB125413365942645917.html?mod=wsj_share_facebook

Business sentiment up for the seventh month in a row. Not a great recovery, but so far better than ours:

http://www.economy.com/dismal/pro/release.asp?edition=2&r=eur_bcs&src=dd_immediate

Those are the business optimism numbers for the US, Latin America, Europe and Asia respectively. Great timing as Germany elects a strong supply-side majority yesterday.

http://www.economy.com/dismal/pro/release_extInfo.asp?rk=2E04405B-1730-4496-9951-2D203ED87E27

 The Chicago Fed says data for August is…

“…improved for the seventh consecutive month…. [but] suggests that growth in national economic activity was below its historical trend.”

This should sound familiar to you.

http://www.chicagofed.org/economic_research_and_data/files/cfnai_september2009.pdf