Last week I stated that “other than a horribly weak economy, there are no major signs indicating an outright contraction.” This needs to be expanded as an economy is not a homogeneous mechanism that ebbs and flows in unison. There are economic elements which can be pointed at that are contracting or, if not contracting, …
This month’s Philly Fed business outlook survey has reverted to almost exact values of one year ago using unadjusted data. Early evidence is accumulating that the current recovery sub-cycle may be peaking, a call made by Econintersect’s economic activity indicator in late March.
The Philly Fed Business Survey quantitatively was less good in April 2011 – but this is a quantification of opinion, and changes may be real, or not.
The economy is improving but the record high opinion of improving new orders is not a credible measurement of great strength.
The businesses surveyed by the NY Fed and the Philadelphia Fed reside in different universes. One says conditions have collapsed, the other says they improved.