From the New York Fed

Business conditions weakened for
New York State manufacturers
for a third consecutive month in
August. The general business
conditions index fell four points
to -7.7. The new orders index also
fell, inching down to -7.8; the
negative reading—the third in a
row—indicated that orders had
declined. The shipments index held
steady at 3.0, a sign that shipments
were slightly higher over the
month. The unfi lled orders index
continued to drift down, falling
three points to -15.2


None of that reads well and it weakens hope that the deterioration we saw in the last couple of months was a blip.

I see Manufacturing Surveys this month as critical. Three straight disappointing months makes a trend. If they call come out badly it’s a pretty clear sign that manufacturing is weakening.

This is troubling given that manufacturing was providing strong support during the recovery. The slight upward trend in manufacturing jobs was in contrast to 15 years of downward trend.

While it was always going to be the case that the downward trend was likely to reassert itself, I would have hoped that it did not do so before construction turned around and state and local government stabilized.