Economy – Additions & Updates

Additions – durable goods, Skousen B2B index

Updates – initial jobless claims, wage growth, housing, sentiment, GDP 

Asset Allocation – Additions & Updates

Additions – none

Updates – yields, stock/bond/currency trends

Economic Summary:

Initial Jobless Claims – slight uptick

Wage Growth –  small increase

Housing – pending home sales: falling, prices: falling month over month, increasing year over year 

Sentiment – falling

Durable Goods – falling / recessionary

China Manufacturing – falling 

Initial Jobless Claims

Initial jobless claims rose 12k last week to 267k but close to 42 year lows…

Housing

Following new home sales disappointment, pending home sales dropped 1.8% in June the biggest drop since Dec 2013. After 5 months of gains, and with median prices at record highs, it appears affordability is crushing hopes of any sustained ‘recovery.'

The 0.18% month-over-month decline in the Case – Shiller home price index is the biggest since July 2014, however annually, prices are increasing about twice as fast as inflation or wages.

Price increases may be leaving the middle class with little hope of owning and pushed the home ownership rate to 63.4%, the lowest reading since the first quarter of 1967.

Wage Growth

The quarterly increase in US wages was just 0.2% – a third of the 0.6% rise expected – and a low 2% increase Y/Y. This was off the 0.7% rise in Q1, the weakest US wage growth since records began in 1982 and subtracted from the September rate hike expectation.

Sentiment

Gallup's Economic Confidence Index continued its gradual, downward slide, reaching -14 for the week ending July 26. This represents a 10-month low for the index.

Meanwhile, 39% of Americans said the economy is “getting better,” while 57% said it is “getting worse.”