Housing Data Tops the List of Economic Releases this Week
This week’s economic news calendar is chock full of housing data releases, some of which serve as important proxies for pre-sentiment around jobs stabilization and consumer confidence. At the same time, Week Two of earnings season features blue chip companies whose 2nd Quarter numbers may be strong, but whose visibility into 3rd and 4th Quarter visibility is opaque at best, menacing at worst.
Sound familiar for home building companies? They’d done just about all they can to shrink their balance sheets for the worst of the downturn periods, and now time is nigh to drive topline performance. Question is can they? As we listen to the earnings calls among home builders over the next two weeks, we’ll be keen to probe both the analysis and the plan each company puts in place to sustain their hard-won momentum.
Collectively, with a few exceptions, the public home builders behaved as if 2010 will ramp nicely into a fully-formed if modest demand cycle in 2011.
The economy, a little like the stubborn low-pressure weather system that has settled in for a petulant stay in the Atlantic off the Carolinas and has blanketed the mid-Atlantic coast with a several-week muggy heat-wave, seems to be challenged by inertial as well as dynamic forces.
The one manifest source of big demand for capacity globally is Asia, which is shifting from overheated to a more sustainable level of growth. Europe is day to day, given its debt and credit landmines, and the U.S. seems to be an equal mix of pluses and minuses, with the pluses losing steam even as the minuses seeming to find a more stable high ground.
Clearly too, debate over policy, action, or a decisive plan to cease interceding at the government level sharply, and antagonistically, devides those who are most outspoken about righting the what has gone off in the economy. The conversation in too many cases crosses the line of argument into ugly ideologue, unbecoming of the nation’s spirit of resilience, tolerance, and particular manner of blending disparate interests.
We’re with New York Times Op-Ed essayist Roger Altman in assessing the moment’s need for business and policy-makers to call a time-out on their dance of death, because together U.S. business and government have a few of the answers Main Street wants right now.
The tension between President Obama and the business community is hurting both sides and may hamper economic recovery. Closing that divide requires the business community to mute its criticism, and the administration to make personnel and policy adjustments. Neither should be hard.
The summer of 2010 may go down as the period–similar to many stock market crashes–that retests lowpoints of both consumer and business confidence that occurred as the financial system came unhinged in the Fall of 2008.
Robert Shiller, in the book “Animal Spirits” he co-wrote with George Akerlof, talks about a term that makes all the sense in the world right about now: “the confidence multiplier.” At the center of the word confidence, Shiller notes, there’s a Latin word root “fido,” which means “I trust.”
It’s the Summer of 2010. No one can make the 2009 Obama $790 billion stimulus package bigger now than it was. No one can make the George W. Bush 2008 $200 billion tax and spending stimulus package bigger now than that was.
The question of yet another stimulus plan comes now amid heightened rancor, fear, and suspicion in the ramp-up to November’s mid-term elections. Whether more stimulus would instill or asphyxiate a confidence multiplier is likely to get lost in the heat-wave debate between “Austerians” vs. the “Stimulites.”
That’s why, in looking this week at the latest data for housing starts, permits, and existing home sales, it would be a good BS meter to put them into a trailing three-month bucket, and compare the latest three months to the same three-month period in 2009.
This way, one can filter out some of the artificial timing moves that show up in the single-month release, and perform analysis based on reality. (HT to a reader Marvin Chosky for this recommendation).
Here, from blogger Econ Grapher, is a line-up of key data releases expected this week in the U.S. and global markets. And don’t forget the parade of 2nd Quarter earnings we’ll also be attuned to.
Day Time (GMT) Code Event/Release Forecast Previous MON 8:00 EUR Euro-Zone Current Account s.a. (euros) (MAY) -5.1B MON 14:00 USD NAHB Housing Market Index (JUL) 16 17 TUE 1:30 AUD Reserve Bank of Australia Meeting Minutes TUE 5:00 JPY Leading Index (MAY F) 98.7 TUE 6:15 CHF Trade Balance (Swiss franc) (JUN) 0.82B TUE 8:30 GBP Major Banks Mortgage Approvals (JUN) 52K 51K TUE 8:30 GBP Public Finances (PSNCR) (Pounds) (JUN) 16.0B 12.0B TUE 12:30 USD Housing Starts (MoM) (JUN) -2.8% -10.0% TUE 12:30 USD Housing Starts (JUN) 577K 593K TUE 12:30 USD Building Permits (MoM) (JUN) -0.7% -5.9% TUE 12:30 USD Building Permits (JUN) 570K 574K TUE 13:00 CAD Bank of Canada Interest Rate Decision 0.75% 0.50% TUE 22:45 NZD New Zealand Net Migration s.a. (JUN) 250 WED 3:00 NZD Credit Card Spending s.a. (MoM) (JUN) 1.9% WED 8:30 GBP Bank of England Meeting Minutes WED 14:00 AUD NAB Business Confidence (2Q) 17 WED 14:00 USD Ben Bernanke Testifies to Senate Banking Panel THU 3:00 NZD ANZ Consumer Confidence Index (JUL) 122 THU 4:30 JPY All Industry Activity Index (MoM) (MAY) -0.4% 1.8% THU 7:30 EUR German PMI Manufacturing (JUL A) 58.0 58.4 THU 7:30 EUR German PMI Services (JUL A) 54.5 54.8 THU 8:00 EUR Euro-Zone PMI Manufacturing (JUL A) 55.2 55.6 THU 8:00 EUR Euro-Zone PMI Services (JUL A) 55.0 55.5 THU 8:30 GBP Retail Sales ex Auto Fuel (YoY) (JUN) 2.4% 3.4% THU 9:00 EUR Euro-Zone Industrial New Orders s.a. (MoM) (MAY) -0.1% 0.9% THU 12:30 CAD Retail Sales (MoM) (MAY) 0.5% -2.0% THU 13:30 USD Ben Bernanke Testifies to House Financial Committee THU 14:00 USD Existing Home Sales (MoM) (JUN) -8.1% -2.2% THU 14:00 USD Existing Home Sales (JUN) 5.20M 5.66M THU 14:00 USD House Price Index (MoM) (MAY) -0.3% 0.8% THU 14:00 USD Leading Indicators (JUN) -0.3% 0.4% THU 14:00 EUR Euro-Zone Consumer Confidence (JUL A) -17 -17 FRI EUR EU European Bank Stress Test Results Due FRI 1:30 AUD Export Price Index (QoQ) (2Q) 12.0% 3.8% FRI 8:00 EUR German IFO – Business Climate (JUL) 101.5 101.8 FRI 8:00 EUR German IFO – Expectations (JUL) 101.5 102.4 FRI 8:30 GBP Gross Domestic Product (YoY) (2Q A) 1.1% -0.2% FRI 8:30 GBP Gross Domestic Product (QoQ) (2Q A) 0.6% 0.3% FRI 11:00 CAD Consumer Price Index (YoY) (JUN) 0.9% 1.4% FRI 11:00 CAD Bank Canada CPI Core (YoY) (JUN) 1.9% 1.8%
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