December’s consumer price index; November’s Mortgage Monitor and job openings & turnover survey

Major reports that were released this past week included the December Consumer Price Index and the Job Openings and Labor Turnover Survey (JOLTS) for November, both from the Bureau of Labor Statistics, which had funding prior to the government shutdown…major reports which were scheduled this week which were postponed due to department furloughs included the Full Report on Manufacturers’ Shipments, Inventories and Orders for November from the Census Bureau, which had been scheduled for Monday, the  November report on our International Trade from the Commerce Department, which had been scheduled for Tuesday, and the Census report on Wholesale Trade, Sales and Inventories for November, which had been scheduled for Thursday….however, the Federal Reserve, which is self-funded, released the Consumer Credit Report for November on Tuesday…that report showed that overall consumer credit, a measure of non-real estate debt, expanded by a seasonally adjusted $22.2 billion, or at a 6.7% annual rate, as non-revolving credit expanded at a 7.1% rate to $2937.0 billion and revolving credit outstanding grew at a 5.5% rate to $1,042.2 billion…

Privately issued reports released this week included the December Non-Manufacturing Report On Business; which saw the NMI (non-manufacturing index) come in at 57.6%, down from 60.7% in November, indicating that a smaller plurality of service industry purchasing managers reported expansion in various facets of their business in December than did in November, and the Mortgage Monitor for November (pdf) from Black Knight Financial Services, which reported that 3.71% of all US mortgages were delinquent in November, up from 3.64% in October but down from 4.55% in November a year ago, and that 0.52% of all mortgages were in the foreclosure process at the end of the month, the same percentage as in October, but down from the 0.66% of mortgages that were in foreclosure in November a year ago…

Since it’s been more than two years since we’ve looked at any of the metrics from the Mortgage Monitor, we’ll include below an abbreviated portion of the Mortgage Monitor summary table, showing the monthly count of active home mortgage loans and their delinquency status, which comes from page 22 of the pdf

November 2018 mortgage monitor loan count summary table

The columns in the table above show the total active mortgage loan count nationally for each month given, number of mortgages that were delinquent by more than 90 days but not yet in foreclosure, the monthly count of those mortgages that are in the foreclosure process (FC), the total non-current mortgages, including those that just missed one or two house payments, and then the number of foreclosure starts for each month over the past year and for each January shown going back to January 2005….in the last two columns, we see the average length of time that those who have been more than 90 days delinquent have remained in their homes without foreclosure, and then the average number of days those in foreclosure have been stuck in that process because of the lengthy foreclosure pipelines, especially in judicial states…the average length of delinquency for those who have been more than 90 days delinquent without foreclosure has continued falling from the April 2015 record of 536 days and is now at 397 days, while the average time for those who’ve been in foreclosure without a resolution is now at 859 days, down from the record high of 1061 days that was set in August 2015…considering that foreclosure starts have been averaging around 45,000 a month while the number of those that remain in the foreclosure process has been around 268,000, it appears that foreclosures started in recent months are typically being resolved in a period of less than 6 months (180 days)..…hence, for the average time for mortgages to be in the foreclosure process to still be as high as 859 days, some foreclosures started early in the mortgage crisis must still not yet be completed…there’s got to be a story about those mortgages, but i haven’t seen anyone in the media address it for several years..

December Consumer Prices down 0.1% as Lower Gasoline Prices Offset Higher Food and Rents

The consumer price index decreased by 0.1% in December, as somewhat higher prices for food and shelter were more than offset by much lower prices for gasoline… the Consumer Price Index Summary from the Bureau of Labor Statistics indicated that the seasonally adjusted price index fell 0.1% in December after it had been statistically unchanged in November, risen 0.3% in October, 0.1% in September, 0.2% in August, 0.2% in July, 0.1% in June, 0.2% in May, 0.2% in April but after falling 0.1% in March after it had risen by 0.2% in February, 0.5% in January, and by 0.1% last December…the unadjusted CPI-U index, which was set with prices of the 1982 to 1984 period equal to 100, fell from 252.038 in November to 251.233 in December, which still left it statistically 1.9102% higher than the 246.524 index reading in December of last year, which is reported as a 1.9% year over year increase….with lower gasoline prices the primary reason for the drop in the overall index, seasonally adjusted core prices, which exclude food and energy, rose by 0.2% for the month, even though the unadjusted core price index also fell from 259.105 to 259.083, which left the core index 2.179% ahead of its year ago reading of 253.558, which is reported as a 2.2% year over year increase, same as the annual increase reported a month ago..

The volatile seasonally adjusted energy price index fell by 3.5% in December, after falling 2.2% in November, rising by 2.4% in October, falling by 0.5% in September, rising by 1.9% in August, falling by 0.3% in July and by 0.3% in June, rising by 0.9% in May and by 1.4% in April, falling by 2.8% in March, rising by 0.1% in February and by 3.0% in January, and thus is now 0.3% lower than in December a year ago…the price index for energy commodities was 7.4% lower in December, while the index for energy services rose by 1.8%, after rising by 0.3% in November…the energy commodity index was down 7.4% due to a 7.5% decrease in price of gasoline, the largest component, and an 11.4% decrease in the index for fuel oils, while prices for other energy commodities, such as propane, kerosene, and firewood, averaged 1.3% lower…within energy services, the index for utility gas service rose 5.6% after falling by 0.7% in November and is now 2.3% higher than it was a year ago, while the electricity price index was 0.7% higher, after it had risen 0.3% in November….energy commodities are now 1.8% lower than their year ago levels, with gasoline prices averaging 2.1% lower than they were a year ago, while the energy services price index is now 1.4% higher than last December, as electricity prices have also increased by 1.1% over that period…

The seasonally adjusted food price index was 0.4% higher in December, after rising 0.2% in November, falling 0.1% in October, being unchanged in September, rising 0.1% in August, 0.1% in July, 0.2% in June, after being unchanged in May, rising 0.3% in April, 0.1% in March, being unchanged in February, rising 0.2% in January, and 0.2% in December of last year, and after being unchanged in October and November of 2017, as the price index for food purchased for use at home rose 0.4% in December, while the index for food bought to eat away from home was also 0.4% higher, as prices at fast food outlets rose 0.4% and prices at full service restaurants rose 0.5%, while food prices at employee sites and schools averaged 0.2% lower…

In the food at home categories, the price index for cereals and bakery products was 0.4 higher as average bread prices rose 1.2%, cereal prices rose 1.3%, and cake and cupcake prices rose 1.0%….on the other hand, the price index for the meats, poultry, fish, and eggs group was unchanged, as the beef and pork indexes both rose just 0.1% and the seafood index rose 0.7% while egg prices were 2.9% lower…at the same time, the seasonally adjusted index for dairy products was 0.3% higher, even though unadjusted milk prices fell 0.5%…meanwhile, the fruits and vegetables index was 1.7% higher on a 1.9% increase in the price index for fresh fruits and a 2.6% increase in the price index for fresh vegetables, which included a 14.5% jump in prices for lettuce….at the same time, the beverages index was 0.3% higher, as carbonated drink prices rose 0.3% and roast coffee prices rose 1.1%…lastly, the index for the ‘other foods at home’ category was 0.3% lower, as both sugar and margarine prices fell 1.4% and average prices for snacks fell 1.9%….the itemized list for price changes in over 100 separate food items is included at the beginning of Table 2 for this release, which gives us a line item breakdown for prices of more than 200 CPI items overall…since last December, just lettuce, which is now priced 15.0% higher than a year ago, is the only ‘food at home’ line item that has seen prices change by more than 10% over the past year…

Among the seasonally adjusted core components of the CPI, which rose by 0.2% in December after rising by 0.2% in November, 0.2% in October, 0.1% in September, by 0.1% in August, 0.2% in July, 0.2% in June, 0.2% in May, 0.1% in April, 0.1% in March, 0.2% in February, 0.3% in January, and by 0.3% last December, the composite price index of all goods less food and energy goods was 0.1% higher, while the composite for all services less energy services was 0.3% higher….among the goods components, which will be used by the Bureau of Economic Analysis to adjust December retail sales for inflation in national accounts data, the index for household furnishings and supplies decreased by 0.1%, as the price index for laundry appliances fell 1.5% while the price index for window and floor coverings was 1.4 % lower…meanwhile, the apparel price index was unchanged, as a 1.3% decrease in the index for men’s apparel was offset by a 1.1% increase in the index for boy’s apparel and a 0.5% increase in the index for women’s apparel…at the same time, the price index for transportation commodities other than fuel was also unchanged, as prices for both new and used cars fell 0.2% while tire prices rose 1.0% and the index for oil, coolant, and fluids rose 1.3%…on the other hand, prices for medical care commodities were 0.2% lower as prescription drugs prices fell 0.4%, while the recreational commodities index rose 1.3% on a 6.7% increase in the index for sports vehicles including bicycles and a 1.4% increase in the index for toys, games, hobbies and playground equipment…in addition, the education and communication commodities index was 0.7% higher after falling 1.3% in November and 1.5% in October, on a 1.4% increase in the index for personal computers and peripheral equipment and a 1.1% increase in the index for educational books and supplies…lastly, a separate price index for alcoholic beverages was unchanged, while the price index for ‘other goods’ fell 0.4% on a 1.4% decrease in the price index for miscellaneous personal goods…

Within core services, the price index for shelter rose 0.3% on a 0.3% increase in rents, a 0.2% increase in homeowner’s equivalent rent, and a 3.1% increase in lodging away from home at hotels and motels, while the shelter sub-index for water, sewers and trash collection rose 0.3%, and other household operation costs were on average 2.0% higher….the price index for medical care services was up by 0.4%, as both hospital inpatient services and hospital outpatient services rose 0.6% and health insurance rose 1.3%…on the other hand, the transportation services index was down by 0.2% as vehicle repair costs fell 0.7% and airline fares fell 1.5%…at the same time, the recreation services price index was 0.3% higher as cable and satellite television service rose 0.6% and admission to sporting events jumped 4.9%….meanwhile, the index for education and communication services was 0.1% higher as tuitions rose 0.2% and child care and nursery school costs rose 0.4%….lastly, the index for other personal services was up 0.2% as haircuts rose 0.4% and apparel services other than laundry and dry cleaning rose 0.8%…among core line items, prices for televisions, which are now 18.6% cheaper than a year ago, and the price index for telephone hardware, calculators, and other consumer information items, which is down by 11.2% since last December, have both seen prices drop by more than 10% over the past year, while the price index for laundry equipment, which has still increased 13.2% year over year, and the price index for boy’s apparel, which is up 13.1% since last December, have both seen prices rise by a double digit magnitude over that span…

Job Openings, Hiring & Quitting Decreased In November, Layoffs were Little Changed

The Job Openings and Labor Turnover Survey (JOLTS) report for November from the Bureau of Labor Statistics estimated that seasonally adjusted job openings decreased by 243,000, from 7,131,000 in October to 6,888,000 in November, after October job openings were revised 52,000 higher, from 7,079,000 to 7,131,000…November’s jobs openings were still 16.1% higher than the 5,931,000 job openings reported in November a year ago, as the job openings ratio expressed as a percentage of the employed fell to 4.4% in November from 4.5% October, but it was still up from 3.9% in November a year ago….the largest percentage decrease in November openings was a 39,000 job opening decrease to 90,000 openings in the real estate, rental and leasing jobs sector, while the transportation, warehousing, and utilities sector saw job openings increase by 40,000 to 298,000 (see table 1 for more job openings details)…like most BLS releases, the press release for this report is easy to understand and also refers us to the associated table for the data cited, which are linked at the end of the release…

The JOLTS release also reports on labor turnover, which consists of hires and job separations, which in turn is further divided into layoffs and discharges, those who quit, and ‘other separations’, which includes retirements and deaths….in November, seasonally adjusted new hires totaled 5,710,000, down by 218,000 from the revised 5,928,000 who were hired or rehired in October, as the hiring rate as a percentage of all employed fell to 3.8% in November from 4.0% October, while it was still up from 3.7% in November a year ago (details on hiring by region and by sector since July are in table 2)….meanwhile, total separations fell by 114,000, from 5,621,000 in October to 5,507,000 in November, as the separations rate as a percentage of the employed fell from 3.8% to 3.7%, while it was still up from 3.6% in November a year ago (see table 3)…subtracting the 5,507,000 total separations from the total hires of 5,710,000 would imply an increase of 203,000 jobs in November, a bit more than the revised payroll job increase of 176,000 for November reported in the December establishment survey last week, but still within the expected +/-115,000 margin of error in these incomplete samplings

Breaking down the seasonally adjusted job separations, the BLS finds that 3,407,000 of us voluntarily quit our jobs in November, down by 108,000 from the revised 3,519,000 who quit their jobs in October, while the quits rate, widely watched as an indicator of worker confidence, remained unchanged at 2.3% of total employment, while it was up from 2.2% a year earlier (see job quitting details in table 4)….in addition to those who quit, another 1,769,000 were either laid off, fired or otherwise discharged in November, up by 8,000 from the revised 1,761,000 who were discharged in October, as the discharges rate remained unchanged at 1.2% of total employment, which was also the same as the discharges rate of 1.2% in November a year ago….meanwhile, other separations, which includes retirements and deaths, were at 332,000 in November, down from 341,000 in October, for an ‘other separations rate’ of 0.2%, which was the same rate as in October and as in November of last year….both seasonally adjusted and unadjusted details by industry and by region on hires and job separations, and on job quits and discharges can be accessed easily using the links to tables at the bottom of the press release


 (the above is the synopsis that accompanied my regular sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most picked from the aforementioned GGO posts, contact me…)      

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