The Week's Economic Reports

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The Week's Economic Reports

By: The Mess that Greenspan Made Saturday, October 04, 2008 9:57 PM

Sectors: Economics Data , Finance
Symbols: GM, GS

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The worst labor report in more than five years and the sharpest decline in manufacturing activity since 9/11 highlighted the week's economic reports.

Stocks and bonds ended with the S&P 500 Index down 9.4 percent to 1,099 (for a year-to-date total return of -23.3 percent) and the yield of the 10-year U.S. Treasury note fell 19 basis points to 3.64 percent.

Personal Income and Spending: Incomes rose but spending was flat in August - good news for workers but bad news for the economy. Personal income rose 0.5 percent in August, a big rebound from the upwardly revised decline of -0.6 percent in July. On a year-over-year basis, personal income is now up 4.6 percent while overall PCE inflation is up 4.5 percent, producing meager wage gains in inflation-adjusted terms.

Spending was unchanged in August after rising an upwardly revised 0.6 percent in July. The September data for personal consumption is expected to be flat or negative, part of a continuing slowdown that may produce a quarterly decline in consumer spending in nominal terms for the first time since 1991. This would make it very difficult to post a positive number for economic growth for the third quarter.

Case-Shiller Home Price Index: The S&P Case-Shiller Home Price Index revealed record annual declines of 17.5 percent and 16.3 percent for the 10-City and 20-City Composite Home Price Indices, respectively, paced by Las Vegas and Phoenix where annual declines were 29.9 percent and 29.3 percent. Though a few areas posted month-to-month increases, all 20 cities were in negative territory on a year-over-year basis. For a colorful chart of all 20 cities in the index, see this item from Tuesday

Consumer Confidence: Moderating gasoline prices have helped to push consumer confidence up off of historically low levels seen just a few months ago, however, a rapidly deteriorating job market is beginning to have an impact. The Conference Board's confidence index rose from an upwardly revised 58.5 in August to 59.8 in September but those saying jobs are hard to get rose 1.1 percentage points to 32.8 percent while those saying jobs are plentiful fell 1.3 percentage points to 12.2 percent.

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