U.S. Manufacturing Contracts for First Time in Three Years

[swag]

This discussion thread was locked as off-topic by Omaha Steve (a host of the Latest Breaking News forum).

Source: Bloomberg

By Reade Pickert
September 3, 2019, 7:00 AM PDT Updated on September 3, 2019, 7:25 AM PDT

U.S. factory activity unexpectedly contracted in August for the first time in three years as shrinking orders, production and hiring pushed a widely followed measure of manufacturing to its lowest level since January 2016.

The Institute for Supply Management’s purchasing managers index fell to 49.1 in August, weaker than all forecasts in a Bloomberg survey of economists, data released Tuesday showed. Figures below 50 signal the manufacturing economy is generally contracting. The group’s gauge of new orders dropped to a more than seven-year low, while the production index shrank to the weakest level since the end of 2015.

Faltering manufacturing could complicate President Donald Trump’s re-election campaign as recent data undermines one of his signature promises for a strong economy. Stocks extended declines and the yield on 10-year Treasuries fell sharply Tuesday after the data was released. The dollar weakened.

The latest downturn underscores how slowing global growth and an escalating U.S. trade war with China are taking an even bigger toll on domestic producers. Although manufacturing only makes up about 11% of the economy, there are concerns that entrenched weakness -- and any layoffs that may result -- could filter through to the rest of the economy and endanger the record-long expansion.

Read more: https://www.bloomberg.com/news/articles/2019-09-03/u-s-manufacturing-contracts-for-first-time-in-three-years?srnd=premium

[dalton99a]

1. NEXT: "I hereby order U.S. factories to manufacture more"

[Prosper]

2. Trump's tax and spending cuts

take spending money out of the economy. Even if his Nationalism focused on USA made products the people that spend have less money to spend. No matter how technical or complicated the workings of the economy are portrayed it all depends on how much money the working class has to spend.

[SunSeeker]

3. Winning!

[George II]

4. Hm, what happened about three years ago?

[Lonestarblue]

5. The tax giveaway has done very little other than raise the national debt.

Very few corporations increased hiring or shared their tax bonanza by raising workers’ wages. Those that did raise some wages cut jobs to offset the cost. Most companies used the money for stock buybacks. Trump will cave on the tariffs on China soon because he knows he’s going down. When he does, he’ll try to sell it as the greatest deal ever in the history of all mankind, but the terms are likely to be in China’s favor. And the Chinese soybean market that took around 15 years to build may never return since Brazil and other countries are now supplying more soybeans to China.

The timing of Trump’s cave-in to China will be interesting. If he does it too soon, voters will have time before the election to see that the deal is a bust. If he does it too late so that people have no time to figure out how bad the deal is, he risks it making no difference to voters since his negatives are so bad.

[ffr]

6. Duplicate to the same linked LBN 20 minutes prior.

You might wish to self-delete

Post the latest news from reputable mainstream news websites and blogs. Important news of national interest only. No analysis or opinion pieces. No duplicates. DU LBN

[swag]

9. Oh, thanks.

I do my best to check, but sometimes miss.

[bucolic_frolic]

7. Soft spending is palpable

Can feel it on eBay. Can see it in the closeout grocery store, which by the way, no longer has any Mexican workers. This has led to reduced product selection and higher prices on the remaining products. I'm assuming they chose to process less and raise prices to stay afloat.

When prices increase, I see product stagnating to some degree. People just won't buy it. They move on to something else. You can only do that so long, or you to the extent you are able, buy less or nothing.

Recession is just about here.

[sandensea]

8. The Trump slump

By this time next year, we may well be in a full-blown recession.

The first recession in world history, brought about by use of Twitter.

[Omaha Steve]

10. After a review by forum hosts....LOCKING

Dupe. See the earlier post here: https://www.democraticunderground.com/10142362996