Analysis Roundup for August 17, 2012

NCLGBA will post a collection of topics discussed in economic reports of note from financial institutions and government agencies on a regular (not necessarily weekly) basis.  Here is what we’ve found recently:

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Bureau of Labor Statistics (BLS)
NC, Most States see Unemployment Rise in July

North Carolina’s seasonally-adjusted unemployment rate rose from 9.4% in June to 9.6% in July, making it one of 44 states to see an increase in their unemployment rate for the month.  The Tar Heel State is now tied for the 6th-highest rate (with South Carolina) among states in the US.

Compared to last year, the size of North Carolina’s labor force is pretty stagnant (4.647 million), though it did decrease by 8,400 in the past month. The number of “unemployment” increased by 5,300.

The unadjusted unemployment rate did drop a little from 9.9% to 9.8%, reflecting an increase in summer work. Unadjusted total nonfarm employment experienced a decline of 75,200, a share of the workforce (1.9%) in line with prior performance (2.0% July dropoff last year).

Seasonally adjusted nonfarm employment saw a net increase of 1,800 in July, indicating some improvement in North Carolina’s job market. Strongest sectors of

Wells Fargo Securities
July Leading Indicators Improve, Recession Not Likely

The Conference Board’s Leading Economic Index (LEI) rose 0.4% in July, with growth also reported in coincident and lagging indicators. July also saw increases in building permits and orders for nondefense capital goods, with industrial production remaining at least 4% higher than last year. Consumer confidence, however, continues to decline.

Consumers not embracing Back-to-School Spending

Retail sales taxes are heavily-influenced by families buying for back-to-school, even in an environment where “Sales Tax Holiday” weekends often distort buying patterns. While trade experts anticipate double-digit growth in sales for the season this year, reporter interaction with shoppers indicates they are doing their best to stay within last year’s budgets.

Wells Fargo Securities
Prices Up, Consumer Spending Up

Typically, the Bureau of Labor Statistics (BLS) releases its consumer spending report in conjunction with the Producer Price Index (PPI) for each preceding month, followed a day later by the Consumer Price Index (CPI) report. For July, the PPI increased 0.3%, and “finished” goods increased 0.2%. This was driven primarily by continued significant increases in prices for foodstuffs (+5.2%).

On the consumer side, the CPI for July remained flat compared to June, with the annual rate dropping below 2%. Consumer inflation is driven in large part due to food and energy prices, which are influenced by both producer prices and demand. The CPI for food has increased an annual rate of 2.6% over the past 3 months.

Erskine Bowles Talked About Much More than Paul Ryan

Earlier this week, viral video surfaced of former UNC Chancellor and Deficit Reduction Commission Co-Chair Erskine Bowles expressing compliments of U.S. House Budget Committee Chair (and Mitt Romney’s Vice-Presidential running mate) Paul Ryan. While media have focused on the meaning of this passive “endorsement” of Ryan’s personal capabilities and commitment to reducing the size of the annual Federal budget deficit (not necessarily his policy proposals), the entire speech made by Bowles last September during this UNC Lambeth Lecture is very insightful and worth a look.

In the course of an hour, Bowles provides a convincing case from multiple perspectives for deficit reduction, as well as outlines the vision and values that guided the Deficit Commission’s efforts.

NCLGBA Blog/Wells Fargo Securities
Vitner suggests US Economy growing “slower,” but not “close to the edge” for recession

Check out this August Outlook video, featuring Wells Fargo Economist Mark Vitner.

New York Federal Reserve
How did Banking and Prison Shape O. Henry?

At the New York Fed’s “Liberty Street Economic Blog, you can learn about the early life of famous American writer O. Henry and how his failures as a bank teller, eventually leading him to serving time in jail, helped him focus attention on his now-renowned life’s work.


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