Factory Order Decline Continues for the Fifth Month

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Ceramic Factory Equipment
Ceramic Factory Equipment
Ceramic Factory Equipment

There is a lot of reasons to be excited about the short- to mid-term health prospects of the U.S. economy. After all, a lot has been made about the rosy unemployment figures released by the Obama administration. Another cluster of statistics that market observers can get optimistic about is the increasing volume of consumer spending, as well as consumer confidence. This is all well and good. The problem is that there is one very troubling statistic that people don’t pay enough attention to. I am not talking about durable goods orders. People are rightly concerned about the volume of durable goods

The problem is that there is one very troubling statistic that people don’t pay enough attention to. I am not talking about durable goods orders. People are rightly concerned about the volume of durable goods orders, because this impacts and often predicts business spending in the future. The indicator that I am talking about is on factory orders.

In the United States, factory orders have declined continuously for the fifth straight month. This leads to the conclusion that the economy is slowing. While housing figures have been ramping up, the overall economic picture remains murky if factory orders continue to decline month after month. At the very least, this mirrors a lower business demand in the near to midterm. It also indicates a lower level of confidence in terms of future investments by the business sector. The main

The main reason why the U.S. economy continues to log decent growth rates is because of consumer spending. However, one has to wonder how long that can keep up. You can only run on fumes for so long.

These are very important questions to ponder because the rest of the world isn’t doing so hot. There is a global economic slowdown. You don’t have to look far. Europe is in deflation. Japan is on its back trying to get inflation to 2%. China is still growing, but it is growing at its slowest rate in over two decades. Moreover, there are a lot of open questions regarding the reliability of Chinese government economic statistics. There are definitely clouds on the global economic horizon. The continuous decline in U.S. factory orders forms one serious cluster of clouds that we definitely need to pay more attention to.

There are definitely clouds on the global economic horizon. The continuous decline in U.S. factory orders forms one serious cluster of clouds that we definitely need to pay more attention to.

2 COMMENTS

  1. Amid Gains in Jobs and Pay, Americans Rejoin the Work Force

    By NELSON D. SCHWARTZ FEB. 6, 2015

    New York Times.

    The economy cruised into the new year with a burst of fresh momentum, adding jobs at the fastest pace since the boom of the late 1990s and lifting employment and wage prospects for millions of Americans left behind in a long but mostly lackluster recovery.

    The Labor Department said on Friday that employers added a seasonally adjusted 257,000 jobs in January, but even more significant was a revision of earlier estimates showing an additional gain of 147,000 jobs in November and December.

    https://www.nytimes.com/2015/02/07/business/economy/jobs-unemployment-figures.html

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