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| Consumer Durables Minus Consumer Non-durables 1968-present |
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| Consumer Durables Minus Consumer Non-durables 1947-present |
Discuss.
To get things started. When the quarterly data goes from Positive to minus two percent meaning non durable spending exceeds the durable spending then a recession shows up in short order. Is it a reduction in durable spending or a combination?
6 comments:
The durables are driven by cheap financing (home furnishings, cars, etc.). Those are on fire right now.
Non-durables are suffering as people without access to credit are tapped out, and people with credit are using all their firepower on big ticket items.
Blogger W.C. Varones said...
The durables are driven by cheap financing (home furnishings, cars, etc.). Those are on fire right now.
Non-durables are suffering as people without access to credit are tapped out, and people with credit are using all their firepower on big ticket items.
i.e. the 1% doing quite well
Cinco-X
What big ticket items other than homes?
The recession left people with old impractical cars and C4C shrank the viable inventory. Thus 15.2m new vehicle sales. 0.9% interest rates driving it. When the displaced demand is met and rates rise, likely at the same time watch out.
What is an educated way to determine the most likely time that rates will rise?
For the last 10 years I've heard rates will never be this low again :)
Rates go up when the appetite for money increases. The only thing different this time is that the Fed is at the table.
The Fed has to taper by March. If they don't they will be buying more Treasuries than will be being issued. If they only moderately taper and still gobble up too much of the new issuance we could see rates actually fall. Recent housing weakness whispers that the banks still have too many properties and not enough performing loans.
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