Skip to comments.Durable-goods orders minus aircraft strong
Posted on 02/27/2013 10:40:50 AM PST by 1rudeboy
Bookings climb 1.9% excluding volatile transportation sector
WASHINGTON (MarketWatch) Bookings for big-ticket U.S. goods slumped in January because of weaker demand for aircraft, but orders were generally strong elsewhere in the economy and suggested that business investment is picking up.
Orders for durable goods sank 5.2% last month, the Commerce Department said Wednesday, largely in line with Wall Street expectations.
Orders for Boeing Co. jets soared in December but were virtually nil in January, reflecting the volatile nature of the aircraft business. Commercial aircraft orders plunged 34% while motor-vehicle bookings were flat.
Bookings for defense aircraft tumbled an even steeper 64%, indicating the military may have placed fewer orders in anticipation of automatic federal spending cuts set to take effect on March 1.
Yet orders for durable goods minus transportation rose 1.9% the biggest increase in more than a year and advanced for the fifth straight month.
Thats the longest string of gains in seven years, signaling that manufacturers continue to benefit from a slowly mending global economy, higher sales to American consumers and a pickup in business investment in the U.S.
Durable goods are products designed to last at least three years. Orders for these items are a critical component of U.S. growth since rising sales of autos, computers, furniture and similar items signal an improving economy.
The increase in orders outside of transportation stemmed largely from a 13.5% surge in bookings for machinery. Companies usually buy more machinery when they invest and expand in anticipation of higher orders.
Yet orders fell 5.3% for computers and electronic products.
Orders for core capital goods, a key barometer of private-sector business investment, jumped 6.3% to mark the largest rise in more than two years.
(Excerpt) Read more at marketwatch.com ...
Businesses and consumers have resigned themselves to this new normal.
Fundamental transformation is here.
I know a horse trader, he took advantage of the fact that horses couldn’t be killed in the US by exporting them to Mexico. In 2007 and 2008 he was overrun with horses, I mean people were just giving them to him. Then things slowed down and he actually had to get a job.
In the last 2 months he is now being covered up with horses and once again people are just asking him to take them. He just got a call from OK to pick up 150 horses all he has to pay is the freight. I take this as a bad sign for the economy whether orders are up or not. It is a sign that even if the economy levelled off or even got a little better, that people are going back to basics because they can’t afford anything more.