THE BASIS POINT

GDP +2.0%. TRID Hits Home Sales.

 

GDP (3rdQ2015)

– Real (inflation adjusted) GDP quarter/quarter seasonally adjusted, annualized +2.0%. Initial release was +2.1%
– GDP price index quarter/quarter seasonally adjusted, annualized +1.3%. Previous was +1.3%.

Consumer Spending was +3.0%.  This is the core of GDP.  Overall GDP was weakened by inventory reductions and lower exports which are a consequence of the stronger dollar.

2.0% GDP growth is not going to sustain the increased government spending in the just-passed 2016 budget.  We should be striving for 4% growth in GDP for fiscal sustenance.

 
Corporate Profits (3rdQ2015)
– After-tax Profits year/year  +1.3%. Previous was +1.4%.

 
Redbook Chain Store Sales (week ended 12/19/2015)

– Store Sales year/year  1.8%. Previous was +1.5%

 
FHFA House Price Index  (October 2015)

– Prices month/month +0.5%. Previous was +0.7%
– Prices year/year +6.1%. Previous was +6.1%.

This slowing of price appreciation is, in my view, healthy.  The issues is affordability.

 

Existing Home Sales (November 2015)

– Existing Home Sales seasonally adjusted, annualized  4,760,000. Previous was 5,320,000
– Existing Home Sales month/month -10.5%
– Existing Home Sales year/year -3.8%.

This could be due to the new TRID disclosure rules which may have dislocated sales which might otherwise have happened in October.  The new disclosure rules lengthen the time it takes to close. If this assessment is correct we will see a recovery in the next release.

 
Richmond Federal Manufacturing Index (December 2015)

– Index Level +6. Previous was -3.

This is a survey index of manufacturers in the district served by the Richmond Fed.

 

 

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