Morning Report: Manufacturing continues to struggle

Posted on July 2, 2024 by Brent Nyitray

Vital Statistics:

Stocks are lower this morning on no real news. Bonds and MBS are up small.

Jerome Powell is speaking at 9:30 this morning.

The manufacturing economy contracted again in June, according to the ISM Manufacturing Report. “Demand remains subdued, as companies demonstrate an unwillingness to invest in capital and inventory due to current monetary policy and other conditions. Production execution was down compared to the previous month, likely causing revenue declines, putting pressure on profitability. Suppliers continue to have capacity, with lead times improving and shortages not as severe. Sixty-two percent of manufacturing gross domestic product (GDP) contracted in June, up from 55 percent in May. More concerning is the share of sector GDP registering a composite PMI® calculation at or below 45 percent — a good barometer of overall manufacturing weakness — was 14 percent in June, 10 percentage points higher than the 4 percent reported in May.”

Importantly, the prices index fell pretty dramatically, which helps support falling inflation.

The manufacturing economy expanded slightly in June, according to the S&P US Manufacturing PMI. New orders appear to be increasing, and input costs remain an issue. That said, business confidence hit a 19 month low. “Factories have been hit over the past two years by demand switching post-pandemic from goods to services, while at the same time household and business spending power has been diminished by higher prices and concerns over higher-for-longer interest rates. These headwinds persisted into June, accompanied by heightened uncertainty about the economic outlook as the presidential election draws closer. Business confidence has consequently fallen to the lowest for 19 months, suggesting the manufacturing sector is bracing
itself for further tough times in the coming months.”

Filed under: Economy |

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28 Responses

  1. jnc4p's avatar
    jnc4p, on July 2, 2024 at 1:34 pm said:

    The meltdown continues:

    Manchin threatened to break with Biden before senior Democrats intervened

    “Nobody wants to be the first one to knife Julius Caesar,” one Democratic Party official said.

    By Liz Goodwin, Paul Kane, Leigh Ann Caldwell and Marianna Sotomayor

    July 2, 2024 at 1:23 p.m. EDT

    https://www.washingtonpost.com/politics/2024/07/02/joe-manchin-biden-debate-democrats-drop-out/

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    • jnc4p's avatar
      jnc4p, on July 2, 2024 at 1:41 pm said:

      & continues..

      The Biden Panic Is Getting Worse

      Anxious lawmakers can’t reach him. Donors are fighting over replacements. All of them are asking: When will it end?

      By Gabriel Debenedetti, New York’s national correspondent

      A few dozen influential Democratic donors in Los Angeles settled into into a plush gold-and-cream-accented living room in Holmby Hills for what was to be a cozy debate night, happy to be hosted by James Costos, a former HBO executive and Barack Obama’s ambassador to Spain, and his husband, the celebrity interior designer Michael Smith. They were joined by Second Gentleman Doug Emhoff and a trio of governors who figured to be a big part of Democrats’ post-2024 future: Michigan’s Gretchen Whitmer, Illinois’s J.B. Pritzker, and Kentucky’s Andy Beshear, each of whom gamely took the mic to greet the Angelenos before the main event. Then Joe Biden started speaking on the television and the room froze. The crowd fell silent as Biden muddled through his first few answers, then exploded into disbelieving murmurs as he continued to struggle against Donald Trump. At one point, Rob Reiner yelled above the agitated din — loud enough for the governors to hear — that Biden was going to lose the election.

      https://nymag.com/intelligencer/article/democratic-panic-biden-worse.html

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  4. Brent Nyitray's avatar
    Brent Nyitray, on July 2, 2024 at 8:29 pm said:

    The left really is not taking this immunity ruling well at all

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    • jnc4p's avatar
      jnc4p, on July 3, 2024 at 8:50 am said:

      It’s mostly a ratification of the status quo, i.e. Obama can drone strike an American citizen and not face any charges.

      Another way to look at it is as a rollback of the post-Watergate changes so the presidency is going back to what was assumed pre-Nixon.

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      • Brent Nyitray's avatar
        Brent Nyitray, on July 3, 2024 at 1:57 pm said:

        The left is in full meltdown. They think SCOTUS allowed Trump to nuke the DNC headquarters with no repercussions. Have to let them cry it out.

        Of course none of this would have happened if they hadn’t tried to use Sarbanes-Oxley as a creative way to throw Trump in prison.

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    • jnc4p's avatar
      jnc4p, on July 3, 2024 at 5:53 pm said:

      Good piece on it:

      Don’t like the Supreme Court’s immunity ruling? Blame Merrick Garland.

      With no straightforward case tying Trump to violence, Garland took a historically momentous risk.

      By Jason Willick

      Columnist|

      July 3, 2024 at 3:15 p.m. EDT

      https://www.washingtonpost.com/opinions/2024/07/03/garland-trump-roberts-presidential-immunity/

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      • markinaustin's avatar
        markinaustin, on July 4, 2024 at 8:13 am said:

        Joe, I think Willick makes a good point, but I do think the ruling was over broad in one respect. The presumptive immunity of a claimed official act should have been tempered by the recognition that it is a rebuttable presumption.

        I am not hand wringing here. I think that if a future POTUS orders a drone strike on a political opponent or takes a bribe and calls it an official act both the Justice Department and the Courts will treat that claim as “rebuttable”, after the President’s term of office. I think that “rebuttable” should have been a word of art included in the opinion, and it is not. The guidance would have been clearer if that word had appeared.

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        • Let the mutherfuker burn!'s avatar
          Let the mutherfuker burn!, on July 4, 2024 at 10:22 am said:

          If a POTUS is not impeached and removed after droning or jailing a political opponent, the problems are unresovable. Re bribery for appointments, we all know that exists now.

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        • jnc4p's avatar
          jnc4p, on July 4, 2024 at 2:12 pm said:

          I sort of read “rebuttable” into the “presumptive” language. If it’s not absolute, then it’s rebuttable. But it could have been made clearer for emphasis.

          I do think the Democrats punted what was essentially a political question to the judicial branch because they didn’t have the votes to convict Trump in an impeachment trial.

          John Dean wrote an article for the Atlantic comparing the situation to Nixon, but of course Nixon himself was never indicted. He was impeached. Which is the proper constitutional remedy for abuse of power by the President.

          https://www.theatlantic.com/ideas/archive/2024/07/nixon-would-have-loved-supreme-court/678894/

          The whole thing reminds me of the famous quote from A Man For All Seasons:

          ALICE MORE: Arrest him!

          SIR THOMAS MORE: For what?

          ALICE: He’s dangerous!

          WILLIAM ROPER: For libel, he’s a spy!

          MARGARET MORE: Father, that man’s bad.

          MORE: There is no law against that.

          ROPER: There is! God’s law!

          MORE: Then God can arrest him.

          ALICE: While you talk, he’s gone!

          MORE: And go he should, if he were the Devil himself, until he broke the law!

          ROPER: So! Now you’d give the Devil benefit of law!

          MORE: Yes. What would you do? Cut a great road through the law to get after the Devil?

          ROPER: Yes! I’d cut down every law in England to do that!

          MORE: Oh? And when the last law was down, and the Devil turned round on you, where would you hide, Roper, the laws all being flat?

          This country is planted thick with laws, from coast to coast — man’s laws, not God’s — and if you cut them down — and you’re just the man to do it — do you really think you could stand upright in the winds that would blow then?

          Yes, I’d give the Devil benefit of law, for my own safety’s sake!

          The Democrats have cut a great swath through the law and norms to try and get Trump and now are afraid of what will happen if Trump is elected again and turns those precedents back on them.

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  5. jnc4p's avatar
    jnc4p, on July 4, 2024 at 8:04 am said:

    Probably PopeHat’s best piece. Always worth a reread on July 4th.

    https://popehat.substack.com/p/the-fourth-of-july

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  6. markinaustin's avatar
    markinaustin, on July 4, 2024 at 8:58 am said:

    “Early last year, a hacker gained access to the internal messaging systems of OpenAI, the maker of ChatGPT, and stole details about the design of the company’s A.I. technologies.

    The hacker lifted details from discussions in an online forum where employees talked about OpenAI’s latest technologies, according to two people familiar with the incident, but did not get into the systems where the company houses and builds its artificial intelligence.”

    While Congress tries to put a fence around AI I assume China will be making its own rules after stealing American tech to bolster its own.

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  8. jnc4p's avatar
    jnc4p, on July 4, 2024 at 2:43 pm said:

    For those who haven’t heard of this yet:

    How the Right Won the Hawk Tuah Girl This is a huge, huge problem for Democrats.

    By Luke Winkie

    July 03, 20244:38 PM

    …

    This rhymes with a recent segment on The Ezra Klein Show, where he asserted that the ideological divide in America has less to do with party polarization and is far more related to the fact that Trump, consistently, is winning huge swaths of Americans who don’t follow any political news whatsoever. The numbers are stark. According to a poll by NBC, Trump is winning the non-political-news-consuming demographic by 26 points.

    All of this has skewed the optics about what it means to be political in 2024. If you’re a member of the Zynternet—which is to say, you do not advertise precise ideological stances, your Instagram stories are not constantly paneled with causes you care about, and you tend to wield the internet for the pursuit of pleasure and nothing else—then you will be perceived to be right wing. And frankly, that is not a sustainable electoral model. The Democrat experience should not be a gantlet of soul-crushing fury and anxiety. The party must make room for people who enjoy life and all of its beautiful frivolities, which—if we’re being brutally honest—is the default setting all of humanity should be aspiring toward.

    https://slate.com/life/2024/07/hawk-tuah-girl-video-what-is-hailey-welch-meaning.html

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  9. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on July 4, 2024 at 6:41 pm said:

    Lol

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  11. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on July 5, 2024 at 12:54 pm said:

    Weird that this keeps happening.

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  13. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on July 7, 2024 at 3:52 pm said:

    Yes, it would be the end of the road for us if a sitting President tried to jail his political opponent.

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  14. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on July 7, 2024 at 10:46 pm said:

    By God, he is diabolical!

    Oy vey!

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