Tuesday, August 08, 2017

Employment Situation: Nonfarm Payrolls and Civilian Unemployment July 2017

The latest Employment Situation Report indicated that in July, net non-farm payrolls increased by 209,000 jobs overall with the private non-farm payrolls sub-component adding 205,000 jobs while the civilian unemployment rate declined to 4.3% over the same period.

Net private sector jobs increased 0.17% since last month climbing 1.68% above the level seen a year ago and climbing 7.08% above the peak level of employment seen in December 2007 prior to the Great Recession.

Employment Situation: Unemployment Duration July 2017

The latest employment situation report showed that conditions for the long term unemployed generally worsened in July.

Workers unemployed 27 weeks or more increased to 1.785 million or 25.9% of all unemployed workers while the median term of unemployment increased to 10.6 weeks and the average stay on unemployment increased to 24.9 weeks.



Employment Situation: Total Unemployment July 2017

The latest Employment Situation report showed that in July “total unemployment” including all marginally attached workers went flat at 8.6% while the traditionally reported unemployment rate declined to 4.3%.

The traditional unemployment rate is calculated from the monthly household survey results using a fairly explicit definition of “unemployed” (essentially unemployed and currently looking for full time employment) leaving many workers to be considered effectively “on the margin” either employed in part time work when full time is preferred or simply unemployed and no longer looking for work.

The Bureau of Labor Statistics considers “marginally attached” workers (including discouraged workers) and persons who have settled for part time employment to be “underutilized” labor.

The broadest view of unemployment would include both traditionally unemployed workers and all other underutilized workers.

To calculate the “total” rate of unemployment we would simply use this larger group rather than the smaller and more restrictive “unemployed” group used in the traditional unemployment rate calculation.

Thursday, July 27, 2017

The Chicago Fed National Activity Index: June 2017

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity improved in June with the index rising to a level of 0.13 from a weak level of -0.30 a month earlier while the three month moving average rose to a level of 0.06.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

Tuesday, July 25, 2017

FHFA Monthly Home Prices: May 2017

Recently, the Federal Housing Finance Agency (FHFA) released the latest results of their monthly house price index (HPI) showing that in May, nationally, home prices increased 0.39% from April rising 6.86% above the level seen in May 2016.

The FHFA monthly HPI are formulated from home purchase information collected from mortgages that have been sold to or guaranteed by Fannie Mae and Freddie Mac.

S&P Core Logic Case-Shiller: May 2017

The latest release of the S&P Core Logic Case-Shiller (CSI) home price indices for May reported that the non-seasonally adjusted National index increased from April with prices rising 0.97% while the non-seasonally adjusted Composite-10 city index increased 0.70% and the Composite-20 city index increased 0.81% over the same period.

On an annual basis, the National index increased 5.58% above the level seen in May 2016 while the Composite-10 city index increased 4.94% and the Composite-20 city index increased 5.69% over the same period.

On a peak basis, the non-seasonally adjusted National index recently surpassed the record high level seen prior the onset of the Great Recession rising 3.24% above the level seen in 2006 while the Composite-10 index remained -6.19% below the peak level and the Composite-20 remained -3.66% below.

Monday, July 24, 2017

Existing Home Sales Report: June 2017

Recently, the National Association of Realtors (NAR) released their Existing Home Sales Report for June showing a decline with total home sales falling 1.8% since May but climbing 0.7% above the level seen a year earlier.

Single family home sales also declined with sales falling 2.0% from May but rising 0.6% above the level seen a year earlier while the median selling price increased 5.1% over the same period.

Inventory of single family homes went flat from May at 1.74 million units, falling 7.4% below the level seen in June 2016 which, along with the sales pace, resulted in a monthly supply of 4.3 months.

The following charts (click for full-screen dynamic version) shows national existing single family home sales, median home prices, inventory and months of supply.



Friday, June 02, 2017

Employment Situation: Nonfarm Payrolls and Civilian Unemployment May 2017

Today's Employment Situation Report indicated that in May, net non-farm payrolls increased by 138,000 jobs overall with the private non-farm payrolls sub-component adding 147,000 jobs while the civilian unemployment rate declined to 4.3% over the same period.

Net private sector jobs increased 0.12% since last month climbing 1.77% above the level seen a year ago and climbing 6.77% above the peak level of employment seen in December 2007 prior to the Great Recession.

Employment Situation: Unemployment Duration May 2017

Today's employment situation report showed that conditions for the long term unemployed generally worsened in May.

Workers unemployed 27 weeks or more increased to 1.663 million or 24.0% of all unemployed workers while the median term of unemployment declined to 10.4 weeks and the average stay on unemployment went flat at 24.7 weeks.



Employment Situation: Total Unemployment May 2017

Today's Employment Situation report showed that in May “total unemployment” including all marginally attached workers declined to 8.4% while the traditionally reported unemployment rate declined to 4.3%.

The traditional unemployment rate is calculated from the monthly household survey results using a fairly explicit definition of “unemployed” (essentially unemployed and currently looking for full time employment) leaving many workers to be considered effectively “on the margin” either employed in part time work when full time is preferred or simply unemployed and no longer looking for work.

The Bureau of Labor Statistics considers “marginally attached” workers (including discouraged workers) and persons who have settled for part time employment to be “underutilized” labor.

The broadest view of unemployment would include both traditionally unemployed workers and all other underutilized workers.

To calculate the “total” rate of unemployment we would simply use this larger group rather than the smaller and more restrictive “unemployed” group used in the traditional unemployment rate calculation.

Tuesday, May 30, 2017

S&P Core Logic Case-Shiller: March 2017

Today's release of the S&P Core Logic Case-Shiller (CSI) home price indices for March reported that the non-seasonally adjusted National index increased from February with prices rising 0.81% while the non-seasonally adjusted Composite-10 city index increased 0.91% and the Composite-20 city index increased 0.98% over the same period.

On an annual basis, the National index increased 5.75% above the level seen in March 2016 while the Composite-10 city index increased 5.22% and the Composite-20 city index increased 5.89% over the same period.

On a peak basis, the non-seasonally adjusted National index just surpassed the record high level seen prior the onset of the great recession rising 1.26% above the level seen in 2006 while the Composite-10 index remained -7.59% below the peak level and the Composite-20 remained -5.39% below.

Thursday, April 27, 2017

Pending Home Sales: March 2017

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for March showing an notable decline in sales activity with the seasonally adjusted national index falling 0.8% from February but remaining 0.8% above the level seen in March 2016.

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Wednesday, April 26, 2017

NAR Against Tax Reform is Self Interest Over Common Sense

The National Association of Realtors nearly immediately met today's Trump administration tax reform policy announcement with outright rejection suggesting that the proposed changes were placing "home-ownership in the cross-hairs" and further suggested that the proposed tax changes would "nullify" the current tax benefits of owning a home.

It's important to note though that the primary issue that the NAR has taken with the proposal has only to do with how it may change the use of the mortgage interest deduction (and NOT the primary residence exclusion which the administration directly indicated was unaffected) which would only come as a result of the proposed increase in the standard deduction.

Since, under the Trump proposal, individuals and households would have a larger standard deduction (apparently 2x larger!) there would fewer tax filers itemizing their deductions (i.e. they would be taking the standard deduction in lieu of itemizing) and thus fewer caring about the tax "benefit" of taking on a mortgage.

So, while the presumed impact of the loss of this "benefit" has the NAR concerned about their private interest, common sense tells us that this is not a loss in any normal sense and further that taxpayers overall would be better off with a 2x increase in their standard deduction than the perverse incentive of taking on more housing debt.

UPDATE: Apparently the mortgage interest deduction is now NOT changing so NAR need not reject major tax reform only to protect their own self interest.

Tuesday, April 25, 2017

S&P Core Logic Case-Shiller: February 2017

Today's release of the S&P Core Logic Case-Shiller (CSI) home price indices for February reported that the non-seasonally adjusted National index increased from January with prices rising 0.24% while the non-seasonally adjusted Composite-10 city index increased 0.33% and the Composite-20 city index increased 0.42% over the same period.

On an annual basis, the National index increased 5.76% above the level seen in February 2016 while the Composite-10 city index increased 5.19% and the Composite-20 city index increased 5.85% over the same period.

On a peak basis, the non-seasonally adjusted National index just surpassed the record high level seen prior the onset of the great recession rising 0.24% above the level seen in 2006 while the Composite-10 index remained -8.41% below the peak level and the Composite-20 remained -6.31% below.

FHFA Monthly Home Prices: February 2017

Today, the Federal Housing Finance Agency (FHFA) released the latest results of their monthly house price index (HPI) showing that in February, nationally, home prices increased 0.79% from January rising 6.43% above the level seen in February 2016.

The FHFA monthly HPI are formulated from home purchase information collected from mortgages that have been sold to or guaranteed by Fannie Mae and Freddie Mac.