Durable Goods Orders in U.S. Unexpectedly Decreased

Source: Bloomberg

By Timothy R. Homan

Sept. 25 (Bloomberg) -- Demand for U.S. durable goods unexpectedly fell in August, signaling companies are planning to curb spending on concern gains in sales will not be sustained.

Orders for goods meant to least several years dropped 2.4 percent, the worst performance since January, the Commerce Department said today in Washington. Excluding transportation equipment, orders were little changed.

Restrained consumer spending and near-record excess capacity mean companies will probably not boost investment in new plants or equipment in coming months. The report caused Morgan Stanley in New York to cut its projection for third- quarter economic growth and indicates the jump in auto sales from the Obama administration’s $3 billion trade-in program may not give other industries a jolt.

“Firms are delaying spending where possible,” said David Semmens, an economist at Standard Chartered Bank in New York. “The U.S. has a disappointing recovery ahead. We are not going to see the kind of rebound we are used to.”

U.S. stocks fell after the report, erasing an earlier advance. The Standard & Poor’s 500 Index lost 0.4 percent to 1,047.10 at 9:40 a.m. in New York. Morgan Stanley lowered its forecast for third-quarter growth to 3.2 percent from 3.7 percent after the report, according to a note to clients from David Greenlaw, the firm’s chief fixed-income economist.

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=aeUQ.LJkTyZc

Jobless, sale-less recovery.

Consumer Sentiment Soars In Late September.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x4076742

retirees are not going to buy new durable goods unless it`s absolutely necessary. we`ll make do with the stuff we have or buy good used stuff if we need it. with new houses not being built , existing home sales stagnate, and a long term job recovery, the people who could purchase new durable goods can`t.

Craig's List, etc.

That is, when we buy stuff at all, which isn't very often (aside from consumables like food & gas).

I still can't figure out how this economy is supposedly recovering with jobs still drying up and foreclosures still soaring.

on edit: grammar & clarity

n/t

but the article states that it was unexpected.

According to Wikipedia, durable goods also include appliances, electronic equipment, home furnishings and fixtures, houseware and accessories, photographic equipment, recreational goods, sporting goods, toys and games.

And the article did not specify consumer durables, so it could be businesses cutting back on delivery fleets, manufacturing equipment, restaurant kitchen equipment, and so forth.

"The only things doing any good are the things having money pumped into them."

-- and, Remember that photo on DU a couple nights ago of all the cargo ships sitting in a strait in Indonesia, effectively moth-balled? The Indonesian islanders there saying they have never seen anything like it? It was like a ghost parking lot for cargo ships.