The Laird Economics Report, September 2013
We are pleased to provide readers with the latest edition of The Laird Economics Report — hot off the press. Each month, The Laird Economics Report examines where we are today, based on a detailed presentation of economic indicators with some historical context. This comprehensive downloadable monthly report — prepared by financial expert Jim Laird — compiles a plethora of key economic data in one easy-to-understand summary.
In this month’s report: it’s rare that everything points in the same direction. Trade data seems to be coming in much stronger — though hard to see on the chart, there’s been a big boost in the BALTIX index, which tracks the pricing on shipping. Excess demand over supply causes it to jump. This seems to match the Purchasing Managers Indices (PMI), which generally speaking are improving around the globe. They are our favorite leading indicator of economic activity and are usually positively correlated with stronger economic performance.
In reviewing the data, the one thing that puzzled Jim was the decline in earnings estimates for the S&P 500 components — especially in 2014. Downgrades across the board in estimated operating and reported earnings, often a reduction of about $1 per quarter.
This is partially a US story — it is the S&P 500 after all — but it’s peculiar given the positive results from employment figures and various survey data (though consumer confidence did take a hit this month). The bond market seems to be saying something different as the yield curve continues to shift upwards (though still at historic lows) – which would be true if (1.) higher inflation is expected, or (2.) the bond market thinks that the fed will let rates rise again.
The Laird Economics Report
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