Category: U.S. Economy
Economic: U.S. – Consumer Credit
Consumer credit is as old as human history but, Adam Smith (1723-1790) mostly dismissed the idea because he never thought it would be popular. Benjamin Franklin observed in Poor Richard’s Almanack that staying out of debt was desirable but, not always practiced, “the People heard it and approved the Doctrine, and immediately practiced the contrary”. Most early economists never believed consumer credit would have a major impact on global economies.
Update Economic USA Consumer Credit
Consumer credit continues to show renewed expansion without undue stress in servicing debt. Household debt remains low at 66% of household economic output compared to 87% of 2009.
Update Economic USA Employment
Employment continues to do well in the U.S. with the addition of 235,000 in nonfarm payrolls. This is better than the previous month in all categories except Midsized businesses. Increases in the small business category is especially important because this is the category where most new jobs are created. Most jobs in larger enterprises are replacement positions, but even in this category the additions were 62,000 greater than previous. Inflation in wages may start to appear in greater earnest in the next 6 months, but for now it is subdued at 2.4% annually. The unemployment rate remains extremely low at 4.1% with 5.27 million new hirings.
Update Economic USA Housing
Housing has returned to the upper ranges of our forecast coming in at 1,127 while new home sales continued on a growth path reaching 667,000. Existing home sales (gold line) started moving back up again after several months of lower levels. Existing homes are struggling under low inventory and increasing prices.
Update Economic USA Industrial Production, Capacity Utilization
Industrial production continues to grow with a 0.2 point increase over last month and 1.6 points from last year. Capacity utilization moved up 0.2% to 76.0% from last month and industrial output advanced 0.1 points. This economic measurement is gradually approaching the long-term average of 79.5%.