One of the most useful things you can do as an investor is chart the course of US economics.
I put up 24 charts side by side for comparative analyis. 11 charts focus just on US housing.
Titled - Are we heading for recession?
To answer this question I decided to focus on the US market to determine the true state of affairs and ascertain risk in the current market.
The source of pure data (without formatting) is located at: US Economic Charts
It's just not possible to put so many charts for analysis into a nice looking blog page but the initial analysis is:
- US GDP growth is lower but not recessionary. Economic growth in the second half of the year is now expected to be about 2%, down from prior estimates of as much as 4% - Inflation - ticking up but contained - Manufacturing - indicates monthly expansion in general activity though at a very slow rate - Inventories - historically at low levels - Auto sales - lower but still elevated - Retail sales - trending well but expected to lower as consumers respond to Augusts' downdraft of data by spending less. Consumers are proving to be more resilient than expected but consumer credit remains elevated with the exception of a 10-20% reduction in revolving or ongoing credit. - Corporate profits - remains elevated but not growing as fast. Half of the revenue generated by the S&P 500 comes from overseas and roughly 50% of that from Europe. Of the 498 of the S&P 500 that have reported second-quarter earnings, 71% have exceeded expectations, according to Thomson Reuters analyst Jharonne Martis. - Unemployment - remains elevated (Obama's jobs package appears to be targeting an area of key weakness in the US economy) - Jobless claims - trended up slightly in the last few weeks - Housing - key area of focus, housing starts are trending slightly up which may explain the slight pickup in construction, existing home sales are tapering off with a slight rise in inventory . Shadow inventory (deliquencies etc) remains at at elevated level but has fallen as has the number of homes in the deliquency process. The key positive here that may indicate a bottom is also a slight uptick in prices paid.
I have thus become more bullish and more optimistic. a history of my pessmism though is recorded at: Business Blog
(20min delay)