Category: Energy

Economics Update

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The Institute for Supply Management’s Chicago Purchasers’ Index beat expectations,
rising to 50, where 50 is the dividing line between contraction and expansion.

It’s the highest number since last September, but it has been goosed a bit for cash for clunkers, which has me wondering what the number will look this September.

I would say that we have a pretty good indicator for the cynics among us (hi there) that the stock market rally will soon be ending, as insiders are now selling their stocks 30.6 times more than they are buying, and when the insiders sell, it generally means that some sort of disappointment is on the way.

We are getting mixed signals from Asia, with both Chinese and Japanese industrial production rising, but South Korean exports falling this month, giving a 20.6% year over year drop.

In energy, closed at $69.96/bbl, as falling stocks led to demand concerns, and in currency, the biggest mover was the Yen, on the election news.

Economics Update

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Consumer confidence is at a 4 month low for August, Reuters/University of Michigan Surveys of Consumers, which compares with the Conference Board’s reading, which was up a few days back.

Both results are consistent in that they beat expectations, but this confuses the hell out of me. I think that future sentiment has a bigger role in the Conference Board’s survey, which may explain the difference.

We saw consumer spending rise by 0.2% in July, though income was flat, but this should be taken with a grain of salt, as the increase was entirely a consequence of the “Cash for Clunkers” program.

Meanwhile, in banking, the Federal Reserve is reducing the size of its Term Auction Facility (TAF) cash for sh$#pile auctions to banks, largely on the basis of reduced demand for them:

Banks are increasing lending to buyers of high-yield company loans and mortgage bonds at what may be the fastest pace since the credit-market debacle began in 2007.

……

“I am surprised by how quickly the market has become receptive to leverage again,” said Bob Franz, the co-head of syndicated loans in New York at Credit Suisse. The Swiss bank has seen increasing investor demand for financing to buy loans in the past two months, he said.

I’m not surprised. Modern investment banking is about making big bucks by scamming rubes like the one pictured on the right.

Unfortunately, said rube has the power to make every American taxpayer pay for his decisions.

Meanwhile, on the other side of both ponds, we have record unemployment and record deflation, while businesses in the UK cut investment spending at a record rate, so there is not much in the way of green shoots there.

In currency, the dollar fell, and more significantly, the “cost of borrowing dollars for three months slipped below the rate on similar loans in yen for the first time since 1993,” which implies that in the event of a flight to safety, that money will go toward Japan, where returns are now marginally higher.

In energy, oil rose slightly.

Economics Update, Yesterday’s

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And actually Tuesday’s too.

Between helping my kids try out recipes for a cooking contest, and general laziness, I’ve let it slide.

In any case, the big news is that consumer confidence beat expectations, and actually went into “optimistic” territory, though as Dean Baker observesmost of the increse in the index is, “Attributable to a 10.1 percentage point increase in the expectations index,” which, “is much more volatile than the current conditions index and has little relationship to spending,” so the numbers are not about hopped up consumers bringing on a recovery.

We also have reports that home sales and durable goods orders have increased, and the American Trucking Association’s Tonnage Index (top pic) all increased in July, though I will address how the home sales/prices may be a Chimera in a later post, and the durable goods orders are not as good as they appears, ex-Boeing and defense, they actually fall:

Orders for non-defense capital goods excluding aircraft, a barometer of business investment, fell 0.3 percent in July after rising 3.6 percent in June.

Additionally, the Philadelphia Fed State Coincident Indicator numbers came out (bottom pic), and all but 4 states are still contracting.

It should be noted that mortgage apps were up slightly this week.

We also had a major downgrade of an insurer, Massachusetts Mutual Life Insurance, which had its rating cut from AAA to AA+ by S&P.

I expect there to be more of this in insurance.

Despite a near record auction, US Treasuries were basically unchanged.

Meanwhile, the consumer confidence drove the dollar up, though oil fell, on the expectation of increases in inventories in today’s report.

Economics Update

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The Big Picture looks at the sales numbers

Seeing as how I did not post on Friday, there was a tornado watch, and my kids were freaking, I’ll start with the big story from last week, which was that existing home sales rose to a 2 year high.

Of course, the 1st thing that comes to mind is that the National Association of Realtors (NAR) are supplying this data, and it’s suspect.

The 2nd thing that comes to mind is that a remarkably large portion of these sales are distressed.

The Big Picture runs the numbers more fully (chart pr0n is from this link, click to see full size), and while mentioning these two points, notes some other interesting bits of information:

  • “If not for a surprise and suspect 16k increase in Northeast condo sales, Existing Home Sales would have been lower month-over-month and only up 12k units from July 2008, which was the worst year on record for housing.”
  • Non-seasonally adjusted data actually shows a decrease, and given the high proportion of foreclosures and short sales, seasonal adjustment is actually not going to be accurate right now; the market is just too fracked right now.
  • Prices are still falling.
  • Sales less foreclosure activity (bottom pic) is way down.

Furthermore, we are also seeing the effect of the housing cash for clunkers tax credit, which allows a 10% tax credit (max $8K) on purchases for “New” (not owned a house in 3 years) buyers, but the home has to close before November 30, which really means having the sale done in the next 8 weeks or so, so it’s another blip, unless, as CR notes, the NAR and NAHB manage to successfully bribe lobby for an extension.

Note that the tax credit can be used for a down-payment, which further distorts the market.

He have a housing market that is really still heading down, albeit more slowly, despite massive federal subsidies.

If there were really a return to health in the housing market, then Taylor Bean, the 12th largest mortgage company in the US, would not be filing for bankruptcy.

As to housing news for the rest of us, the rate at which mortgage holders who have fallen behind catch up on their payments, the so-called “cure rate”, for holders of prime mortgages, has fallen to 6.6%, down from 45% in the years 2000-2006, and very close to the rate for Alt-A (4.3%) and sub-prime (5.3%).

Meanwhile, treasuries have risen again, driving yields down, though it is unclear how much is risk aversion increasing, and how much is the Federal Reserve buying more of the securities.

It does mean that investors believe that the Fed won’t be raising rates for a while yet, though the Bank of Israel just raised its benchmark rate, which indicates optimism on their part.

My guess is that they are wrong, simply because they are the 1st central bank to do so, and my money is on any first mover jumping the gun.

Then again, they could be right. The Chicago Fed July National Activity Index rose sharply in July, increasing to -0.74 in July from -1.82.

Even though the numbers still show contraction, the delta is impressive.

Meanwhile, in energy, crude oil is at a 10-month high on “green shoots” in the economy, and retail gasoline prices have remained basically unchanged, despite falls at the wholesale level.

The dollar was up slightly, largely in a holding pattern as traders wait for new consumer spending and housing data.

Economics Update

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Well, mortgage applications rose this week as rates fell 23 basis points (0.23%), not too surprising.

The Architecture Billings Index, one of the leading indicators of future construction activity, rose in July, (click pic for full size) but remained below 50, indicating continued contraction roughly 12 months out.

Meanwhile, we are seeing near record drops in producer prices in Germany, adding more weight to the idea that the current concern should be deflation, not inflation.

Energy is kind of confusing, with prices falling below $69/bbl today, largely on a 5% drop in prices in Chinese stocks, but prices rise to nearly $72/bbl tomorrow on reports of shrinking inventories.

It’s an international dateline thing. The drop was at market close in New York, and the increase was from places where it is tomorrow.

Meanwhile, the dollar is down on optimism about the world economy.

Economics Update

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Housing Starts, Courtesy Calculated Risk

I guess that it’s time to rejoice, because the IMF’s chief economist is saying that the global recession is over…Seeing as how they handled things like the Asian Financial Crisis of the 1990s, I’m inclined to believe that they are not a reliable source.

I would also note that he has a huge caveat in this, “we may not go back to the old growth path … potential output may be lower than it was before the crisis,” which to my mind sounds like a permanent decline in economic activity, and thus the recession might be over because normalcy is being redefined.

That being said, we are seeing signs of either a recovery, or a pause in the path downward, with credit card defaults moderating somewhat, so, for example, BoA’s charge-off rate dropped to 13.81% last month, down 0.05% from the level in June.

Basically, the numbers are still pretty horrible, but they aren’t getting any worse…yet.

We also have a stronger consumer confidence level in August, with the Investor’s Business Daily and TechnoMetrica Market Intelligence (IBD/TIPP) Economic Optimism Index rising to 50.3 in August from 46.3 last month, and this is a real positive number as 50 is the dividing line between optimism and pessimism.

In inflation, producer prices fell by -0.9% from the previous month, and the year over year price decline was -6.8%, beating the predictions of -0.3% and -5.9% respectively.

Meanwhile, in the UK, consumer inflation remained steady at 1.8%, but it had been predicted to drop to 1.5%.

Real estate is confusing, or at least the reporting of it is.

The data came out today, and the coverage is interesting, with Bloomberg noting that single-family housing starts rose for the 5th straight month, but CNN noting that housing starts and building permits declined with only single family housing starts showing an improvement, and that the year over year numbers are way down.

I’d go with CNN here, because:

  • We know that more than a third of single family home sales are distressed.
    • As an aside, we know that people are coming out of the woodwork looking for distressed sales, and prices are still falling, driven by foreclosures and short sales, as evidenced by the latest data out of California.
  • The month to month numbers are seasonally adjusted, but I think that the current market is so out of whack that the seasonal adjustments do not serve their intended purpose.
  • The drop in multi-residential buildings indicates that fewer people are moving into condos/townhouses, from which they would trade up to single family structures.

Then again, YMMV, and I always see the economic glass as half empty.

Oil was briefly back above $70/bbl before settling at $69.19, largely on a report that US crude inventories have dropped, and the dollar and Yen both fell against the Euro, largely on more optimistic business sentiment in Germany.

Economics Update

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Graph Pr0n, courtesy of Calculated Risk

Lets lead with some good news, the New York Bank of the Federal Reserve’s Empire State Manufacturing Index hit its highest level since November, 2007, and it’s actually positive, as opposed to the “falling less slowly,” good news we frequently see from hack economic reporters. (See top pic)

We also have home builder confidence, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, rising to its highest level in more than a year.

<Paul Harvey>And now, the rest of the story:</Paul Harvey>

We have the delinquency rates at commercial banks rising sharply in Q2, and the banks responded by tightening credit significantly.

This is pushing up the price of treasuries, and thus lowering their yields, as investors flee to quality.

As a result, the Fed has extended its TALF facility for commercial real estate, because they (correctly) see an impending crash.

Meanwhile, on the other side of the pond, where our other partner in corrupt “Anglo-Saxon Capitalism” goes to work, asking prices of UK homes fell by 2.2% this month, (that’s for the month, not annualized) with lack of credit to home buyers being a large factor in this move.

All in all, most of the signs are not good, which is why both crude oil and natural gas fell significantly today, and the US dollar and the Japanese Yen both rose.

Economics Update

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You know, someone had better tell the ordinary people of the US that things are getting better, because they are not buying it. 63.2 in August, down from 66 in July.

What’s more, we are seeing more signs of deflation, with consumer prices falling by 2.1% year over year, the biggest drop since January, 1950.

What’s more, commercial real estate is going through the economy like a guy in a hockey mask through a road trip of teenage girls in a slasher flick, with commercial mortgage backed bonds falling, which has driven up their yields, and commercial real estate prices falling by 17% in the first ½ of the year.

We do have some good news in industrial production, where output rose by ½%, beating expectations, largely on “cash for clunkers”.

The confidence figures had currency traders moving to the Yen, and it also pummeled both crude oil and wholesale gasoline futures.

Economics Update

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Retail sales numbers courtesy of Calculated Risk

It’s Jobless Thursday, and initial claims rose by 4,000 to 558K, with the 4 Week moving average increasing to 565K from 556.5K, and continuing claims, falling by 141K to 6.2 million, though for the latter, I’m not sure how much is people exhausting claims and moving to extended benefits, and how much is people finding work.

My money is on a negative interpretation of the data, what with retail sales falling in July. (see graph pr0n)

In Europe, Germany’s and France’s GDP both rose at an annual rate of 0.3%, which has people shouting that they’ve left the recession, but a recession is more than raw GDP numbers, and industrial output in the EU tanked in June.

I’m a pessimist….I see it as a pause, not a reversal, we still have more down to go.

All in all, when one considers the that 35% increase in bankruptcy filings in the 2nd quarter , the abysmal foreclosure numbers, and the fact that video game sales are down for the 5th straight month, I just don’t basis for anything like a robust recovery.

In T-Bill news, I’m very confused.

First, the 3-year notes rose, then the 10 year notes fell, and today, 30 year Treasuries rose, and I cannot make any sense of that. (bonds rising=yields falling, and vise versa)

If Treasuries continue to rise though, it might reverse the reverse the rise in rates that has a depressed mortgage demand.

In any case, the economic news from Europe had the dollar tanking versus the Euro, to $1.4295:€1.0000, and it also pushed oil marginally higher.

Economics Update

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Trade Deficit Graphs Courtesy of Calculated Risk

The lede today is that the Federal Reserve Open Market Committee (FOMC) med and has issued its report.

Rates are staying where they are, but they are winding down their bond purchase program, and they seem to be seeing a light at the end of the recession tunnel.

You can read their full statement here.

Unsurprisingly, their upbeat attitude pushed the prices down, and hence the yields up, on 10 year US treasuries.

Me, I’m not the optimistic type, and with home prices declining 15.6% year over year, as foreclosures push down prices, and there is also tremendous amount of Shadow inventory out there, where banks are not listing houses on the MLS in order to support prices.

In any case, mortgage rates are on the rise again, which has depressed mortgage applications, particularly those for ReFis.

In addition, further indicators of what is going on in the real economy, specifically back to school sales and pay raises are both trending in the direction of awful.

On the trade deficit, there has been an increase in the US trade deficit, (see graphs) but this is not an artifact of increased demand for goods and services, but of rising oil prices, which, by the way, were up today.

We are also seeing a deflationary spiral in Japan, where wholesale prices fell by 8½% year over year in July.

Still, it appears that the Fed’s optimism has driven the dollar up today.

Economics Update

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We have some pieces of good news. The 1st is that non-farm productivity rose at a 6.4% annual rate, the highest rate since 2003, the 2nd is that wholesale inventories fell at more than twice the predicted rate, and the 3rd is that the Hotel Industry’s Pulse index (HIP) rose in July, for the first time in 19 months.

Both of these numbers are generally positive, though the numbers for productivity include a reduction in hours worked and worker pay, and a reduction in inventories is only a good thing to the degree to which we get to the end of that process.

On the less encouraging side of the spectrum, we have demand for US Treasuries increasing, which indicates a return to risk aversion, and the Baltic Dry Index has fallen for a 9th straight day, which indicates a big drop in international trade.

In energy, we have oil falling below $70/bbl, and in currency, the dollar fell, particularly against the Yen.

Economics Update (Yesterdays)

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Temporary Help Numbers, H/T The Big Picture

I was going to post, but thunder storms came through, and even with a surge protector, I shut down.

It was a big day for central bank news, with reports that the Federal Reserve sending signals that it will stop purchasing Treasuries, which means that while rate hikes are not on the horizon, that quantitative easing (printing money) will be ended over the next few months.

Meanwhile, the granddaddy of zero interest rate central banks, the Bank of Japan, has decided to keep its rate at 0.1% (basically 0%), as the Bank Governor, Masaaki Shirakawa, says that he does not see a strong recovery once stimulus measures fade, “I can’t be confident about the strength of final demand after inventory adjustments and policy measures run their course.”

The Bank of Korea is of the same mind, with it keeping its benchmark rate at 2%, an all time low for the institution.

In employment, the decline in temporary workers seems to be moderating a bit (see graph).

In real estate, it looks like commercial real estate (CRE)is on a path to crash more catastrophically than residential real estate, Fitch Ratings predicting that delinquencies could exceed 5% by year’s end.

Basically, CRE is in a worse place than residential, because they typically take out 5 year mortgages that they have to refinance at the end of the term. If real estate prices go down, they cannot refinance, while in residential real estate, once you have a mortgage, you have one until the loan is paid off.

In China, exports have declined for the 9th straight month, and new loans fell, indicating that they are not out of the woods yet.

Meanwhile, in currency, there has been a flight to safety, driving up the US dollar, and to an even larger degree, the Japanese Yen.

In energy, oil fell, though it is still above $70/bbl, and gasoline prices have spiked, up 15¢ in the past two weeks.

Economics Update

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Yes, it does appear as if things may be bottoming in this pic, H/t Calculated Risk

So, initial unemployment claims fell by 38,000 to 550,000 (seasonally adjusted), which is good, but continuing claims* rose by 69K to 6.31 million, and this number does not include folks who have exhausted benefits, and those who are getting extended benefits, and any number much above 400K is bad news anyway, so this week is just less bad than expected.

We’ve also now had a 5th straight month of pending home sales increases, which seems like good news, though the foreclosure rate seems to still be on the “getting worse” side of the trend, (more in another post) and this includes the fact that somewhere between 30% and 50% of current home sales are in some manner distressed sales.

It’s likely that the continued rise in bankruptcy filings (click on pic for bigger picture), has a lot to do with this.

BTW, this is one of the problem that I have with the Obama/Geithner/Summers “stimulus”: it has very little to do with ordinary people in pain, and a lot to do with keeping the banks healthy.

The fake economy is a higher priority than the real economy.

Which is why the Institute for Supply Management’s Non-Manufacturing Index and the Manufacturing Index both fell again in July, while in the UK, where the stimulus was, you know, stimulus, and not a half baked plan which included inefficient tax cuts, and genuflecting to conservatives in the name of “bipartisanship”, manufacturing rose for the first time in 16 Months.

We do have some good news in real estate, with June pending homes sales increased for the fifth straight month, though I’m still of the opinion that this is largely vulture investors looking for cheap bargains.

Additionally, mortgage rates fell, though one cannot be too certain about how long that will last, as the yields on the mortgage backed bonds hit a 2-month high.

In any case, the good initial claims numbers strengthened the US dollar, which in turn pushed oil down from yesterday’s 6 week high.

*Full disclosure, this includes me…..Any engineering openings in the greater Baltimore area would be very much appreciated.

Economics Update, One Day Late

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Normally, I don’t comment on stock market swings, but the Dow closing above 9000 for the first time since January allows me to invoke this Dragonball Z meme, sorry.*

Yes, I know that this should have been done yesterday, but once I got all the links together, we had heavy thunder storms, and so I shut down for the evening.

In any case, yesterday was unemployment claims Thursday, and new claims are up by 30K to 554K, but note that these numbers are all seasonally adjusted, which means that they really are not particularly valid, since the July shutdowns of GM and Chrysler happened in the spring of this year, so for this week, and to a lesser degree next week, we are flying blind on these statistics.

That being said, I think that the numbers on continuing claims are still valid, or at least more valid, and those numbers fell 88K to 6.225 million.

In any case, 550,000 weekly new unemployment claims, or for that matter anything over 400,000 new claims, is a grim picture, and so we are still well within the “grimness event horizon.”

I would also note that downward pressure on the continuing claims numbers is coming from people who are exhausting their unemployment benefits, and as Peter Boockvar at The Big Picture notes, the number of people on emergency unemployment benefits, which cut in after 26 weeks, are way up, but they are not counted in the continuing claims numbers.

So, I would not put a whole bunch of credence in the normally reported unemployment numbers until probably the August 7 numbers.

In terms of more general economic news, we have credit card charge offs rising again in June, hotel revenues down and vacancies up, and on a conference call, the CEO of UPS noted that he is not seeing any signs of recovery in his shipping business.

On the plus side, Canadian consumer confidence rose in July, and there was a surprise jump in U.K. retail sales, largely on increased purchases of clothing, which means that the Brits are poor, but not poorly dressed.

In real estate, existing home sales rose in June, but it should be noted that 1/3 of these are distressed sales, either foreclosures or short sales, and it should also be noted that prices are still falling off a cliff, down 15.4% year over year.

Mortgage rates are marginally lower, probably in reaction to Bernanke’s testimony before the Congress.

In the area of news that sounds important, but that I cannot for the life of me suss out what it means, it appears that Swiss banks are running out of vault space for gold bullion.

Finally, oil rose and the dollar fell yesterday.

*OK, I’m really not sorry, not one little bit.

Economics Update

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Well, it was a tough day for bonds, with prices falling, and yields rising, on US Treasuries, as investors look more to the downside of the economy.

Interestingly enough, we had a lot of mixed signals from real estate, with the
Federal Housing Finance Agency saying that single family home prices rose 0.9% in May, though they are down 5.6% year over year, the U.S. architecture billings index down again in June, which indicates a continued fall in construction, mortgage applications rose last week, though they remain very low, and Standard & Poor’s losses on subprime mortgage backed securities was revised higher.

In the world of real people, the PBGC took over struggling auto parts maker Delphi’s pension obligations, which should come as a surprise to no one.

We do seem to be seeing signs of “green shoots” in other countries though, with the
South Korean GDP growing at the fastest rate in 6 years in the last quarter, and the Central Bank of Brazil cutting its benchmark rate by the smallest amount since beginning of the year, indicating that they think that their recession is largely over.

In the old standbys of energy and currency, oil ended above $65/bbl on reports of tight inventories, and the dollar hit a 7 week low on increased optimism.

Economics Update

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It appears that Ben Bernanke has a mentioned a secret plan to win the war in Vietnam protect the US dollar from inflation,* which will prevent inflation when the economy recovers, and this has driven Treasuries higher, and their yields lower:

Fed officials said in a report submitted as part of Bernanke’s testimony that policy will be “tightened” when the labor market improves, an economic recovery takes hold and pressures holding down inflation “diminish.” The comments follow a rally in stocks and a rebound in corporate earnings that have stoked speculation the worst recession in half a century is ending.

I’m not an economist, but I still think that one way to get out of this mess is to inflate our way out of this, which will have the effect of devaluing the debt which is holding back our economy.

I understand that it can (*cough* Zimbabwe *cough*) get out of hand, but it seems to me that too many people are under water for any recovery now.

Considering the fact that Americans are paying down their debt at the fastest rate since 1952, I do not see an alternative.

IMHO, We are in a deflationary trap, and creating inflation is the way out of it.

In any case, Bernanke’s statements about inflation boosted the US dollar, and his statements about recovery boosted crude oil prices.

*It’s a “Tricky Dick” Nixon reference, OK?

Economics Update

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The obvious lede here is that the leading economic indicators have risen for the 3rd straight month.

3 straight months is supposed to indicate that that a recovery is likely.

I’m not sure just what the recovery is supposed to be, as in the nonsensically titled article, “Commercial property price drop may signal bottom,” which takes the position that a -7.6% price decline in May, which followed a -8.6% decline in April, (-16.2% in 2 months!!), a -29% year over year decline, and -34.8% decline from peak is not the next tsunami in real estate and banking.

The fact that commercial mortgage defaults have hit a20-year high would seem to mitigate against any recovery any time soon in the commercial real estate sector.

In any case, commercial lender CIT, not to be confused with Citi, managed to cut a deal which staved off bankruptcy, and this calmed investors, which increased their optimism and appetite for risk, which
pushed the dollar to a 6 week low, and drove oil prices up, though retail gasoline, which lags oil prices, fell to an 8 week low.

The Best Press Release Ever

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Cyclone Power Technologies issued the following press release regarding rumors of it creating flesh eating zombie hordes:

PRESS RELEASE

Cyclone Power Technologies Responds to
Rumors about “Flesh Eating ” Military Robot

POMPANO BEACH, FL, July 16, 2009. In response to rumors circulating the internet on sites such as FoxNews.com, FastCompany.com and CNET News about a “flesh eating ”robot project, Cyclone Power Technologies Inc. (Pink Sheets: CYPW) and Robotic Technology Inc. (RTI) would like to set the record straight: This robot is strictly vegetarian.

On July 7, Cyclone announced that it had completed the first stage of development for a beta biomass engine system used to power RTI ’s Energetically Autonomous Tactical Robot (EATR™), a Phase II SBIR project sponsored by the Defense Advanced Research Projects Agency (DARPA), Defense Sciences Office. RTI ’s EATR is an autonomous robotic platform able to perform long-range, long-endurance missions without the need for manual or conventional re-fueling.

RTI ’s patent pending robotic system will be able to find, ingest and extract energy from biomass in the environment. Despite the far-reaching reports that this includes “human bodies,” the public can be assured that the engine Cyclone has developed to power the EATR runs on fuel no scarier than twigs, grass clippings and wood chips – small, plant-based items for which RTI ’s robotic technology is designed to forage. Desecration of the dead is a war crime under Article 15 of the Geneva Conventions, and is certainly not something sanctioned by DARPA, Cyclone or RTI.

“We completely understand the public ’s concern about futuristic robots feeding on the human population,but that is not our mission,”stated Harry Schoell,Cyclone ’s CEO.“We are focused on demonstrating that our engines can create usable, green power from plentiful, renewable plant matter. The commercial applications alone for this earth-friendly energy solution are enormous.”

(emphasis original)

Somehow, I do not think that this press release will help much. They just cemented their position in the public view as a manufacturer of Cannibal Zombdroids™.

If Leno, O’Brien, Letterman, Colbert, or Stewart’s writer’s hear about this, it will be how your company is introduced to mainstream America.

H/t Noah Shachtman.

Economics Update

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Housing starts rose from May to June, but as Barry Ritholtz notes, “The year-over-year data is much clearer: New Starts down 46%, Permits down 52%.” (The graph to the right illustrates this pretty well)

In either case, the housing data was better than expected, which drove oil up, bonds down (and thus their yields rose), and increased the spread between the 2 and 10 year notes.

The dollar rose today, but both the dollar and Yen have fallen more this week than they have since May, indicating an increase appetite for risk.

Still, the number that worries me is the fact that June video game sales are at a 9 year low.

When gaming geeks are cutting back, everyone is cutting back.

Economics Update

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Yeah, it’s actually yesterday’s….What can I say.

Since Thursday is new jobless day, we lead with the fact that new claims for unemployment fell to a 6 month low, though it must noted that these are seasonally adjusted figures, and the still accounts for the spike from the July shutdowns of the GM and Chrysler, which happened earlier this year.

We have two other indices moving in opposite directions, with the Philadelphia Fed industrial index falling, and the NAHB builder confidence index rising, but I’m more inclined to go with the Philly Fed, it’s an index of activity, not sentiment, and also because RealtyTrac is reporting that foreclosure filings hit a new record for the first half of the year.

Mortgage rates stayed pretty much flat over the last week.

In energy, retail gasoline continues to fall, hitting a 2 month low, and crude oil fell on demand concerns.

The dollar fell as well, on increased optimism by investors, who have moved their money to more speculative ventures.