As another October comes into focus there are many signs that robust recovery is no doubt firming in late 2009:
1. Retail sales improved in the last week in Sept according to ICSC-Goldman's tally which rose 0.1 percent. The gain represents a 0.9 percent year-on-year gain that compares with a plus 0.6 percent gain the week before. Goldman's report summarizes that retail traffic is indeed improving. Redbook, like Goldman, reported strength for store sales and extends an improving trend. Redbook further reports that Halloween sales are off to a good start. Later in the week the Commerce Department reported that while everyone was expecting spending to be up in motor vehicle sales, consumers were actually spending elsewhere, too. Consumer spending spiked on clunkermania auto purchases as personal consumption expenditures surged 1.3 percent in August. Indeed there was strength in durable goods spending, which jumped 5.3 percent on sharply higher motor vehicle sales. However, non-durables were robust also with a 2.3 percent boost and services also advanced 0.4 percent.
2. Case-Shiller reported a third month of gains for home sale prices. Their index rose 1.7 percent in July on top of a 1.4 percent gain in June and a 0.5 percent gain in May. Interestingly almost all metro areas now show sale price gains or at least flat conditions in the July report period. Year-on-year rates also improved for a third month. The pending home sales index also jumped in August, up 6.4 percent for a year-on-year gain of 12.4 percent. All regions posted home sales increases for August.
3. The third estimate for second quarter GDP clearly shows the economy at the recession bottom back when we technically called the recession's end in June. And the component mix for second quarter GDP adds to credibility our argument that the third quarter will be much more positive than the lackluster results many had predicted. For the second revision to second quarter GDP, the Commerce Department pushed up its estimate to an annualized 0.7 percent decrease from the previous estimate of minus 1.0 percent.
4. On the employment front, Challenger's count of layoff announcements fell to 66,404 in September, down from 76,456 in August for the lowest total since March 2008. Industrial goods employment showed improvement as did the health care and construction segments. The Monster employment index also showed firming job prospects in many blue collar segments.
The first half of September was full of economic good news, and October is bringing more of the same.
When all you read is gloom, turn here for a much different perspective.