Monday, October 10, 2005

More recession warnings

As readers of this blog may or may not know, I made prediction here last August that we were on the brink of heading into a recession. Here are some more leading indicators. From The Houston Chronicle this morning - "Companies have not been in such shape since the Depression"

From James Hamilton's blog Econobrowser: -

So where do we stand right now? In response to the rapid run-up in gasoline prices in August and the devastation from Katrina, the University of Michigan's index of consumer sentiment fell from 96.5 in July to 76.9 in September. Consumption spending fell 0.5% in August, with sales of many SUV's down 50% in September compared with the year earlier. And today Delphi, the largest U.S. auto parts supplier, filed for bankruptcy.

On Friday we further learned that U.S. nonfarm payroll employment fell by 35,000 jobs in September. Given that we'd normally expect to see a monthly increase in employment of 150,000 jobs, the September figure amounts to 185,000 jobs lost. Although this loss was evidently smaller than many other analysts I suggested on Sept. 7 for the size of the effect that we might expect to see from Katrina itself. I also noted then that 200,000 lost jobs would amount to about 1/4 of a recession-inducing employment shock. See also excellent discussions of the latest job figures by Calculated Risk and Macroblog.

What else is out there? Anything pointing the other way?

Help me out here people.

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