Money Talk Podcast, Friday Sept. 20, 2019
Landaas & Company newsletter September edition now available.
Advisors on This Week’s Show
(with Max Hoelzl and Joel Dresang)
Week in Review (September 16-20, 2019)
Significant economic indicators & reports
No major announcements
Industrial production rebounded in August, rising 0.6% following a 0.1% setback in July. The Federal Reserve reported that manufacturing output increased by 0.5%, reversing a 0.4% decline in July. Mining production surged 1.4% after dropping 1.5% in July partly because of disruptions from Hurricane Barry. Capacity utilization rose to 77.9% in August, the first increase since hitting a post-recession high of 79.6% in November. Usage still remained below the long-term average of 79.8%, suggesting little threat of inflation.
Multi-family housing construction helped boost August numbers for both housing starts and building permits. The Commerce Department reported that housing starts grew 12.3% from July to an annual pace of nearly 1.4 million structures in August, the highest since June 2007. Single-family housing starts rose 4.4% from July. Meanwhile, issuance of building permits rose to an annual rate of more than 1.4 million, the highest since May 2007 and up 7.7% from the July pace.
Sales of existing houses rose 1.3% in August, the second gain in a row. The National Association of Realtors reported an annual rate of 5.49 million houses sold in August, up 2.6% from the year-ago pace. An economist for the trade group cited low mortgage rates as an attraction to home buyers but complained that a chronically low supply of houses for sale has kept prices climbing. The year-to-year median price rose 4.4% from the year before, the 90th increase in a row.
The moving four-week average for initial unemployment claims fell for the third time in four weeks, still hovering near 50-year lows. Jobless claims were 40% below the 52-year average, according to Labor Department data, suggesting that employers continue to be reluctant to let workers go. The indicator has been a persistent sign of a tight labor market, which has been boosting consumer confidence.
The index of leading economic indicators was unchanged in August, following a 0.4% rise in July. The Conference Board said weakness in manufacturing offset stronger signs in housing. Based on the index, the business research group said the U.S. economy should continue to grow slowly, driven by consumer spending, which accounts for about two-thirds of economic activity.
No major announcements
Market closings for the week
- Nasdaq – 8118, down 59 points or 0.7%
- Standard & Poor’s 500 – 2992, down 16 points or 0.5%
- Dow Jones Industrial– 26934, down 285 points or 1%
- 10-year U.S. Treasury Note – 1.76%, down 0.15 point