Vehicle sales, commercial real estate investment, China services PMI, mortgage purchase apps

Still way down:

I like the headline but the chart not so much:

China Services PMI Rises to 3-Month High

The Caixin China General Services PMI increased to 53.8 in October 2021 from 53.4 in the prior month, pointing to the second straight month of expansion in the service sector and the steepest pace since July as COVID-19 outbreaks eased. New orders expanded the most in three months, export sales returned to growth, and employment rose for the second month in a row. Meantime, backlogs of work were unchanged following a three-month sequence of accumulation. On the cost front, input prices rose for the 16th straight month and increased at the fastest pace in three months on rising labor, and raw material costs; while output cost inflation accelerated to the quickest since July. Looking forward, sentiment weakened to a four-month low, due to concerns over rising costs and supply chain disruption.

In case you thought the housing market is about interest rates:

“Mortgage applications to purchase a home fell 2% for the week and were 9% lower than the same week one year ago.”

Optimism index, Consumer sentiment, port congestion, lumber, iron ore, coal, steel, soybeans

Apparently ports are clearing:
https://www.cnbc.com/2021/11/01/commerce-secretary-gina-raimondo-sees-clear-improvements-happening-at-congested-us-ports.html

Several commodities seem to have peaked and then fallen back.
Inflation is a continuous increase in the price level, so it doesn’t seem like that’s yet the case:

China, Brazil manufacturing, US Construction Spending, coal

Seems a global thing:

No recovery here:

Another price reversal:

GC Newcastle coal futures tumbled by over 30% to $150 per metric ton, the lowest in three months, and are more than 40% below a record high of $269.5 hit on October 5th, as China stepped up policies to boost output ahead of the winter season. China’s average daily output increased by over 1.2 million tonnes to a record at above 11.6 million tonnes on October 18th. As a result, Chinese power plants now have stocks to produce power for 16 days from less than two days’ inventories at the start of October.

GDP, Unemployment claims, China coal

Deficit spending as a % of GDP heading south fast:

US GDP Growth Disappoints

The American economy expanded an annualized 2% on quarter in Q3 2021, well below market forecasts of 2.7% and slowing sharply from 6.7% in Q2. It is the weakest growth of pandemic recovery as an infusion of government stimulus continued to fade and a surge in COVID-19 cases and global supply constraints weighted on consumption and production.

Gov’s saving money as claims fall:


Transitory?

Consumer sentiment, oil prices, federal debt/GPD

Not looking good:


Russians and Saudis now cooperating to set crude oil prices.
Not good:

Post covid fiscal contraction is underway and debt/gdp is forecast to fall a lot further.
Most of the Federal assistance was the likes of unemployment benefits which have
now expired and new spending programs from Congress seem to be not happening,
at least any time soon. Also, higher prices mean the inflation adjusted value of the
outstanding public debt falls which is a drag on private sector spending as agents seek
to sustain the value of their savings:

Unemployment claims, employment, shipping costs, oil prices

Down a bit since Federal benefits expired. This materially cuts gov. spending:

A lot worse than expected. They thought the end of Federal benefits would send people back to work.
However, a cut in Federal spending cools down aggregate demand:


Transitory comes to mind:

Saudis and Russians are working together to set price. What could go wrong???
:(