Posted on 02/21/2020 1:11:23 PM PST by blam
The coronavirus outbreak may be taking a heavier toll than expected on businesses in the United States, according to a survey released Friday.
Private firms across the U.S. signaled “a slight decline in business activity in February,” IHS Markit said.
The IHS Markit Flash U.S. Composite PMI Output Index dropped to 49.6 in February. That is down from 53.3 in January and below the consensus forecast.
IHS said that overall contraction was driven by a the first fall in service sector output in four years. “With the exception of the government-shutdown of 2013, US business activity contracted for the first time since the global financial crisis in February. Weakness was primarily seen in the service sector, where the first drop in activity for four years was reported, but manufacturing production also ground almost to a halt due to a near-stalling of orders,” Chris Williamson, Chief Business Economist at IHS Markit, said.
The culprits for the February slump: coronavirus and politics.
“Total new orders fell for the first time in over a decade. The deterioration in was in part linked to the coronavirus outbreak, manifesting itself in weakened demand across sectors such as travel and tourism, as well as via falling exports and supply chain disruptions,” Williamson said. “However, companies also reported increased caution in respect to spending due to worries about a wider economic slowdown and uncertainty ahead of the presidential election later this year.”
The IHS Markit report stands in stark contrast to the surveys of manufacturing businesses released this week by the Philadelphia and New York Federal Reserve banks. Those showed a stronger-than-expected uptick in growth in their regions. All three reports are based on surveys of business executives.
One silver lining in the IHS report is that businesses not only remain optimistic but are becoming more
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(Excerpt) Read more at breitbart.com ...
I take this to mean we’re past the worst, and Big Media needs the “crisis”.
Shows that Trump’s policies to be less dependent on China are the was to go.
“The IHS Markit Flash U.S. Composite PMI Output Index dropped to 49.6 in February. That is down from 53.3 in January and below the consensus forecast.”
February is two days shorter than January.
53.3/49.6 = 1.0745
31/29 = 1.0689
That's not relevant. It's an index not a direct measurement of something.
They should be another lesson to bring the most important things home
Let the red zips make the trinkets and let’s bring the important stuff home
“Also a lot companies have a warehouse that might give them extra month. “
Almost everyone is using just-in-time technology. It used to be that companies had a substantial sum tied up in warehoused inventory. That is no longer the case. If you use 200 widgets per month those widgets are shipped just as you will use them and not a moment sooner, as there usually is no storage space for staged widgets. The upside is that substantial sums are saved because they aren’t invested in inventory. The downside is that if there is a supply interruption you feel it instantly.
There will be a substantial impact due to the shutdown of most Chinese industry. The good side of that is, it uncovers a substantial problem at a time when it will have less impact due to Trump’s policies. I am concerned that most of our medicines, including antibiotics, come from Chinese factories. I am, however, certain that Trump is busy working the issue.
The downstream impact to China’s economy will be huge, as much of the Western world diversifies their supply lines, or brings manufacturing home.
The coronavirus is pummelling the stock market. It’s unclear whether it’s being contained.
I just moved everything to 100% stock high growth large cap.
No Joke
My son runs the shipping/receiving dept. for a medical supply manufacturer. In the past week, different carriers he works with have sent him emails warning of delays on international shipments.
It’s beginning to impact the international supply chain.
Really on the high growth.. I went ahead move some to safer investments.
Bring Out Your Dead
Post to me or FReep mail to be on/off the Bring Out Your Dead ping list.
The purpose of the “Bring Out Your Dead” ping list (formerly the “Ebola” ping list) is very early warning of emerging pandemics, as such it has a high false positive rate.
So far the false positive rate is 100%.
At some point we may well have a high mortality pandemic, and likely as not the “Bring Out Your Dead” threads will miss the beginning entirely.
*sigh* Such is life, and death...
If a quarantine saves just one child's life, it's worth it.
welded into an apartment building virus prison in Commie China
https://twitter.com/IsChinar/status/1230732650991648770
Same in manufacturing.
Got a decent level of supplies built up, but now my customers are having issues withe THEIR customers.
Ect.
“There will be a substantial impact due to the shutdown of most Chinese industry. The good side of that is, it uncovers a substantial problem at a time when it will have less impact due to Trump’s policies. I am concerned that most of our medicines, including antibiotics, come from Chinese factories. I am, however, certain that Trump is busy working the issue.”
Kudlow (Trump’s top ‘economic’ advisor) is saying that there’s nothing to worry about. So that gets me REALLY WORRIED, and makes me hope that he’s simply lying to prevent panic buying (so the government can get the remaining imports first).
The American people are in for a TOTAL SHOCK, of depression proportions, if this virus continues on its march through Asia. Some of us have rang the warning bell, but others here don’t seem to realize that virtually everything we buy (imported or not) has some Chinese content. A small example: I just bought a set of brake pads, they were made in Mexico - so I figure not a problem. But half of a brake pad is a steel backer plate. Guess where that’s made. Don’t know, it doesn’t say. So I looked up steel production by country. Any guess which country is #1. Obviously China, but not only are they Number 1, they are now over (or were over) 50% of the steel production of the ENTIRE WORLD. So I’m glad I bought my pads now.
As to Trump, he still may well come out ahead - it’s the Democrats and what’s left of the GOP Old Guard who kept telling us there was ‘nothing to worry about’ regarding our dependence on China. Well, soon we’ll see - obviously Trump was right here, and our imports from China have dropped significantly under Trump. HOWEVER, I’m not sure that our dependence on China has dropped. In other words, if we buy something from Vietnam, and they get their raw materials, or components, from China...we may think that product isn’t Chinese, but China is right there in their supply line...and that line is very likely cut, at the present time.
To give an idea of just what is going on inside of China - it was reported today that new car sales for the first half of February were down 92% from a year ago. At a minimum, that part of their economy is at a dead stop.
“My son runs the shipping/receiving dept. for a medical supply manufacturer. In the past week, different carriers he works with have sent him emails warning of delays on international shipments...It’s beginning to impact the international supply chain.”
For what it’s worth, tell him not to waste his time trying to reset production schedules, based on estimated shipping delays - simply because NO ONE has a clue as to how long, or how bad, these delays will be. Tell him to try to figure out when the containers containing the items/materials he needs have actually left port in China - then he can start on realistic schedules. Probably.
Related:
I saw on TV a day or two ago a story about the one remaining US mfgr. of N95 masks, and how they were ramping up production to meet the higher demand and lower imports caused by (mostly) the COVID-19 virus. It was a pretty positive story. I thought, “Oh, good, at least there is some added supply.”
But then, the report happened to show a mask in its packaging, and it was the exact same one (3M brand) that I was trying to get a 10-pack of at a local building supply - but they only had 2-packs and singles in stock. At the store I’d noticed that the packaging proudly states “Made in USA...”
...with “globally sourced components”.
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