Monday, June 4, 2012

Orders for Factory Goods down .6% in April. And that's the good news.

Via the Fort Worth Star Telegram comes this report about economic indicators moving southward post haste.  From March to April, orders for factory goods dropped 0.6%.  That's not good.  Order for "core capital goods" dropped 2.1 percent.  That's worse.

What's most important about this article, though, is not the numbers themselves.  Anyone expecting those to be even mediocre was kidding themselves; anyone expecting them to be good was delusional.  No, the most important thing in the article is this line "That represented a downward revision from a preliminary estimate that durable goods orders had risen..."

See, that's the real game with government numbers.  Few,  if any, people will actually read far enough into the article to get to things like this.  So what gets reported, initially, is what people hear.  Then, sometime later (about a month, in this case) the original number is "revised down" quietly.  But, because it was done quietly, few people realize that, the next time these "preliminary numbers" or "projections" are reported, they should just assume those numbers are wrong.  Sometimes they're far wrong, as with the "projections" of ~150K new jobs added in face of an official number of ~69,000; that's another number that will be "revised" and probably downward as well.

So, we have incorrect projections and inaccurate preliminary numbers, but we're supposed to trust these so-called experts in the future.  Like when they say, "they expect the recent decline in factory orders to be reversed in the coming months."

Especially with no evidence for that faith.

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