by Mish

As of August 3, 2017, updates to the labor market conditions index (LMCI) have been discontinued. We decided to stop updating the LMCI because we believe it no longer provides a good summary of changes in U.S. labor market conditions. Specifically, model estimates turned out to be more sensitive to the detrending procedure than we had expected, the measurement of some indicators in recent years has changed in ways that significantly degraded their signal content, and including average hourly earnings as an indicator did not provide a meaningful link between labor market conditions and wage growth.

Using similar rationale, the Fed ought to disband itself.

Mike “Mish” Shedlock

Philadelphia Fed Manufacturing Index Surges Again, Positive for Ten Months

The Philadelphia Fed Regional Manufacturing Index surged again this month but remains below two higher recovery highs.

Philly Fed Prices Paid Index Jumps to 59, Up From 44

The Philly Fed prices paid index jumped in April. 59% of firms reported paying more for inputs, up from 44% in March.

How Healthy Is the Labor Market, Really?

What’s the “official” unemployment rate vs. economic reality?

Cass Truck Transportation Index in Freefall

The Cass Truckload Linehaul Index is down for the third consecutive month.

More Trapped Homeowners: Pending Home Sales Decline Again, Index Below 2016 Level

The pending home sales index, an estimate of existing home sales, has accurately provided the direction of the monthly home resale reports.

Dodge Construction Index Shows Weakening Trend in Mature Market

Construction starts rose four percent in June according to the Dodge Index of New Construction.

Philadelphia Fed Manufacturing Survey Shows Employment Index Highest in 48 Years: Reality Check Time

I stopped commenting on the Fed regional manufacturing reports some time ago because they bear little resemblance to reality. Today's Philly Fed report is a real "gem," showing just how screwed up diffusion indexes are, so it's worth a look.

The Verge of "Overheating" Labor Market in Pictures

Economist Mark Zandi fears the tight jobs market may "overheat". In the Beige Book, the word "tight" came up 31 times.

Fed Uncertainty Principle

Most think the Fed follows market expectations. Count me in that group as well.