Monthly data was mixed this week. Existing home sales came in higher than expected; new home sales tanked (which may or may not be of a piece with the surprise decline last month in housing permits and starts, which rebounded this month). 3Q GDP was revised down to a merely good 2.2%. The Chicago Fed's index in November improved. Perhaps most importantly, personal income and spending both increased in November, suggesting 4Q personal consumption expenditures will be up significantly compared with earlier this year.
Turning to the high-frequency weekly indicators:
The ICSC reported that same store sales last week
increased both YoY and WoW. The last four weeks show Y/Y and W/W changes as follows:
Dec 19 +0.4 +0.6
Dec 12 +2.4 +0.4
Dec 5 +2.6 -1.3
Nov 28 +3.1 -0.1
Since last Saturday was the east coast blizzard, it is especially noteworthy that the week still showed a gain.
Meanwhile ShopperTrak reported that sales for the week ending December 19 were down -1.2% YoY, although up +20.0% from the prior week. Again, taking into account that the biggest shopping day featured a blizzard in the Megalopolis, this is actually an encouraging report.
The BLS reported 452,000 new jobless claims last week, the lowest in 15 months. The 4 week moving average also continued to decline.
The E.I.A. reported that gasoline usage continued slightly above last year's level, with prices steady at $2.59/gallon. Oil advanced about $4 to $74 a barrel this week.
Railfax reports that rail traffic last week was up +28.1% vs. a year ago. The four week average was up +15.6%. For the 4th quarter as a whole to date, traffic is down -3.1%. Cyclical traffic is now ahead of last year on a 4 week average basis, and has basically reamined steady since mid-3Q, which is very bullish since it almost always starts to decline in October or November. Intermodal traffic is equal to last year.
An important piece of the encouraging rail traffic news may be reflected in the report by Edmund's that:
This month's new vehicle sales (including fleet sales) are expected to be 1,010,000 units, a 13.3 percent increase from December 2008 and a 3.57 percent increase from November 2009. Edmunds.com analysts predict that December's Seasonally Adjusted Annualized Rate (SAAR) will be 11.11 million, up from 10.89 in November 2009.
Finally, the December 22 Daily Treasury Statement, at $105,187 B, is about 10% less than the same day last year, which showed $116,642 B in withholding taxes paid for December. (Of note, on the 21st the two years were almost exactly equal). Either way, tax revenues are still in a state of severe stress.
In summary, the economy still isn't out of the woods. But there are increasing signs that consumer and producer spending are improving significantly, a good sign for employment going forward.
Most importantly of all, best wishes for a very happy holiday!