Chicago Fed National Activity Index (CFNAI) Reports Improvements in Production-related Indicators

We begin the week with the release of the Chicago Fed National Activity Index (CFNAI) which reports that improvements in production-related indicators the CFNAI rose to +0.49 in April from +0.07 in March. Two of the four broad categories of indicators that make up the index increased from March. The index’s three month moving average, CFNAI-MA3, increased to +0.23 in April from a neutral reading in March.

What do the numbers mean?

A zero value for the monthly index has been associated with the national economy expanding at its historical trend (average) rate of growth; negative values with below-average growth (in standard deviation units); and positive values with above-average growth. Periods of economic expansion have historically been associated with values of the CFNAI-MA3 above –0.70 and the CFNAI Diffusion Index above –0.35.

Conversely, periods of economic contraction have historically been associated with values of the CFNAI-MA3 below –0.70 and the CFNAI Diffusion Index below –0.35. An increasing likelihood of a period of sustained increasing inflation has historically been associated with values of the CFNAI-MA3 above +0.70 more than two years into an economic expansion. Similarly, a substantial likelihood of a period of sustained increasing inflation has historically been associated with values of the CFNAI-MA3 above +1.00 more than two years into an economic expansion.

US Raw Steel Production Rebounded

US raw steel production last week rebounded 0.8% as mills operated at an ACUR of 74.7 percent. In the corresponding week last year mills operated at an ACUR of 74.1 percent. Thus far this year mills have produced prox 35,000,000 tons vs prox 34,000,000 tons produced in the like period last year.

Uptick in Manufacturing Optimism

The manufacturing sector in the US is expected to flourish throughout the remainder of 2017, according to the National Association of Manufacturers (NAM) and the Institute for Supply Management (ISM).

There are a number of factors behind the uptick in manufacturing optimism, particularly improved economic growth overseas, Chad Moutry, chief economist of the Washington based NAM told AMM on May 24…the global economy has turned a corner.

In terms of the US, it is clear that the manufacturing sector has improved from six or twelve months ago…there’s a sense from a policy perspective that manufacturers are to get maybe tax reform or an infrastructure package.

Primary Metals Industry Expecting Revenue Growth

The primary metals industry is among the 17 industries expecting revenue growth for the year and among the 15 anticipating production capacity increases for 2017, the ISM said.
Additionally, the primary metals industry reported an uptick in prices paid for the first half of 2017 and expects prices to continue rising for the remainder of the year.” AMM

Fifth District Manufacturing Activity Less Upbeat in May

The Federal Reserve Bank of Richmond released its Fifth District Survey of Manufacturing Activity for May 2017 and reports firms were less upbeat in May than in the prior three months. Looking six months ahead, manufacturing executives remained generally optimistic although the only index to increase was expected capital expenditures (which is a good thing).

US Census Bureau Advance Report on Manufacturers’ Shipments, Inventories and Orders for April 2017

  • New Orders for manufactured durable goods in April decreased 0.7 percent. This decrease, following four monthly increases followed a 2.3 percent March increase.
  • Shipments of manufactured durable goods in April, down three of the last four months, decreased 0.3 percent following a 0.1 percent March decrease.
  • Inventories of manufactured durable goods in in April, up nine of the last ten months, increased 0.1 percent following a 0.2 percent March increase.

First Quarter GDP 1.2% Annual Growth Rate

The Bureau of Economic Analysis (BEA) released its “second” estimate of first quarter GDP and reports a 1.2 percent annual growth rate. The advance estimate showed growth at 0.7 percent. The third and final report for first quarter GDP will be released around this time next month.

Manchester Suicide Bombing

As the president rallied support from the Arab states in the middle east to rid the world of Islamist extremism, ISIS claimed responsibility for a suicide bombing in Manchester England. Twenty two were killed, mostly children, and 59 were injured while leaving a concert. The maggots of ISIS say killing the children will keep them from becoming infidels. This is just nuts that we are playing footsie with these vermin. I say find them, kill them all and let them rot in hell. We know where many are held up. Why wait? Destroy them where they hide.

Travel Ban

Aside from political strategy, I do not understand why the Democrats in Congress are against the travel bans, legally and rightly imposed by the president, to temporarily stop immigration from certain countries which have been a haven for terrorists. Something like this, done to protect the American people, should NOT have to be decided by the Supreme Court. The Constitution grants the president the power to do what he can, within the law, to protect us from such things. Pure obstruction.


The CBO came out with their calculations of the current health care proposal now in the senate. According to the CBO the plan would reduce the deficit by $119 billion over 10 years. This reduction was needed in order to allow a simple majority of 51 votes to pass through reconciliation. Additionally, the CBO states 23 million people would be uninsured. A frightening number, right?

What they FAIL TO SAY is that 14 million people will come off Medicaid as the program shifts to block grants. The balance of those not having coverage results from the elimination of the mandate which FORCES people to buy insurance and those who will be uninsured do so by their CHOICE. In other words, those younger, healthy adults who are forced to purchase insurance now in order to help pay for those who cannot, can CHOOSE whether or not they want coverage.

The CBO is about as useful as used toilet paper.

“Can Trump Make America Grow Again? The Signs are Hopeful”

Thought you all might enjoy this from an Opinion piece in Thursday’s Wall Street Journal:

There is a gem buried under all the allegations against President Trump: The economy is markedly improving and more people are working. As Speaker Paul Ryan recently noted, Republicans “pledged that we would repeal regulations to create jobs and get the economy moving again.” Through executive orders, regulatory rollbacks and strategic use of the Congressional Review Act, the president and Congress are delivering.

The end of President Obama’s regulatory onslaught could begin the recovery Americans have heard so much about. The business community is increasingly optimistic. Every businessperson I speak with mentions the energizing effect of being able to focus on growth rather than overcoming the latest government roadblock.

In April the Index of Small Business Optimism, produced by the National Federation of Independent Businesses, posted its sixth straight month of historically positive feelings, “a hot streak not seen since 1983” during the Reagan Administration. That’s backed up by the IBD/TIPP Economic Optimism Index, which “gauges how confident consumers, workers and investors are in the pace and direction of the U.S. economy.” An index above 50 indicates optimism. For May, it came in at 51.3. That’s 2.1 points above the index’s 16-year average of 49.2.

It’s still early, but the economy is showing signs of real growth, too. In April the unemployment rate hit a 10-year low, while existing home sales surged to a 10-year high and U.S. industrial production registered its largest gain in three years.

Last Thursday the Labor Department announced that the number of people claiming unemployment insurance benefits dropped to its lowest level since November 1988. Even more impressive, the moving four-week average for this metric dropped to 1.95 million, its lowest level since January 1973, when it was 1.92 million. That’s even more impressive than it sounds, since there are 72 million more people in the labor force today.

The unemployment rate can fall for many reasons that hardly indicate economic health. People can drop out of the labor force or accept part-time jobs because they cannot find full-time work. The good news is that the unemployment rate is declining for the right reasons: More people are finding jobs, and more people are finding full-time jobs—both at an accelerated pace.

From February through April, the first three full months of Mr. Trump’s presidency, the number of Americans employed increased by 628,000 and the number unemployed decreased by 472,000. By comparison, for the same three-month period in 2016, the number of Americans employed decreased by 15,000 while the number unemployed increased by 65,000.

It isn’t merely that more people are working now because the population has grown. A higher percentage of Americans are working. At 60.2%, the proportion of Americans over 16 working in April was at its highest since February 2009, Mr. Obama’s first full month in office. Significantly, Americans in their prime working years are benefiting. At 78.6% in April, the percentage of those 25 to 54 employed hit its highest level since September 2008.

The jobs are better, too. After three full months of the Trump administration, 956,000 more people are working full time and 321,000 fewer are working part time. For the comparable three months in 2016, 49,000 more Americans were working full time and 101,000 fewer were working part time.

With more people working at better jobs, family income increased. According to the independent research firm Sentier, median household income was $59,361 in April, a 15-year high and up 2.2% from $58,060 in January. The latter figure was up 1.7% from $57,090 in June 2009, when the recession ended. In other words, median family income increased more in the first three months of the Trump presidency than during the 7½ years of the Obama recovery.

It will take more than a quarter to produce the robust recovery Americans have expected since the recession ended nearly eight years ago. We need to see sustained annual economic growth in the promised 3% range before declaring victory. To reach that goal, Republicans need to pass tax and health-insurance reform, with or without Democratic support in the Senate (the nuclear option should be on the table). But the economic momentum is already there and hard to deny.

The progressive left is concerned. Should Mr. Trump and Republicans succeed in getting the nation back on the path of economic growth and prosperity, something Mr. Obama was woefully unable to do, it will be decades before the left can again obfuscate economic reality. They will have a much harder time convincing Americans to subject themselves to the stagnation that big government produces. Perhaps this explains the left’s unrelenting and near-hysterical focus on any issue other than the economy.

The task is to build on President Trump’s momentum. If Republicans can unite and advance his economic agenda, the only question in 2018 will be whether the American people can once again see through the fog of media hysteria as they did in 2016.

Mr. Puzder is a former CEO of CKE Restaurants.
Appeared in the May 25, 2017, print edition.

Infrastructure X (Keystone & Dakota pipelines) Regulation Reform XX 1 in 2 out
Individual Tax Reform Entitlement Reform
Business Tax Reform Education Reform
Healthcare Reform X rollback begun Veterans Administration Reform
Rebuild our Military X Trade Reform X
Secure our Borders (The Wall) XX Lead the world from the front XX
Help for the poor X Drain the swamp X as we speak
Peace through unmatchable strength X Support Israel XX
Destroy ISIS XX Extreme Vetting XX to Supreme Court
Conservative Supreme Court nominees XX American Jobs XX

I will track these campaign promises and will check them off as each is accomplished adding those I have missed as they become apparent. This is quite an agenda and will be difficult to achieve all in one term but I believe the American people are behind him and know these things need to be done. Now, if he can get our legislators to support him instead of fighting him….


Have a great weekend…. God bless America!

Buy American made products whenever you can, it’s good for you, good for your friends and neighbors and good for our country.

If you are hiring…try to hire a veteran…. they are loyal, disciplined, hardworking…and they deserve our support.

By the way, if you wish to comment on my rants or offer any other insights you may have, you are encouraged to email me.


In the first place, we should insist that if the immigrant who comes here in good faith becomes an American and assimilates himself to us, he shall be treated on an exact equality with everyone else for it is an outrage to discriminate against any such man because of creed, or birthplace, or origin. But this is predicated upon the person’s becoming in every facet an American and nothing but an American. There can be no divided allegiance here. Any man who says he is an American, but something else also, isn’t an American at all. We have room for but one flag, the American flag…We have room for but one language here and that is the English language…and we have room for but one sole loyalty and that is a loyalty to the American people.”