The manufacturing ISM has been a broken record for nine months. 
Economic activity in the manufacturing sector contracted in June for the ninth consecutive month following a 28-month period of growth according to the Institute for Supply Management. And for the second straight month, every ISM® subcategory is in contraction.
Please consider the July 2023 Manufacturing ISM® Report On Business® by Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management® (ISM®).
“The July Manufacturing PMI® registered 46.4 percent, 0.4 percentage point higher than the 46 percent recorded in June. Regarding the overall economy, this figure indicates an eighth month of contraction after a 30-month period of expansion. The New Orders Index remained in contraction territory at 47.3 percent, 1.7 percentage points higher than the figure of 45.6 percent recorded in June. The Production Index reading of 48.3 percent is a 1.6-percentage point increase compared to June’s figure of 46.7 percent. The Prices Index registered 42.6 percent, up 0.8 percentage point compared to the June figure of 41.8 percent. The Backlog of Orders Index registered 42.8 percent, 4.1 percentage points higher than the June reading of 38.7 percent. The Employment Index dropped further into contraction, registering 44.4 percent, down 3.7 percentage points from June’s reading of 48.1 percent.
“Of the six biggest manufacturing industries, only one — Petroleum & Coal Products — registered growth in July.
“Demand remains weak but marginally better compared to June, production slowed due to lack of work, and suppliers continue to have capacity. There are signs of more employment reduction actions in the near term to better match production output. Ninety-two percent of manufacturing gross domestic product (GDP) contracted in July, up from 71 percent in June. However, the share of manufacturing GDP registering a composite PMI® calculation at or below 45 percent — a good barometer of overall manufacturing weakness — was 25 percent in July, compared to 44 percent in June, a clear positive,” says Fiore.
Diffusion Index Comments
The ISM is a diffusion index, signaling direction not amount. For example a firm hiring 10 workers and a firm laying off 200 workers balances out.
And there is a survival bias and a weighting bias.
ISM Services
On July 6, I noted ISM Services Rebounds Sharply, Prices Rise 73 Straight Months
Unlike manufacturing, services has been in an out of contraction, but mostly positive, with prices increasing 73 consecutive months.
ISM Services reports on Thursday. The Bloomberg Econoday consensus is for a reading of 53 compared to a reading of 53.9 and a near break even 50.3 in May.
We don’t need to make “things” anymore.
We can just make cellphone “apps” for each other.
Yet “CRICKETS” about the Yellow Truck going out of business..
Largest Cargo mover in the USA!!!
Watch for more empty shelves in many parts of the USA!!!
Fitch downgrade of US Federal Government ability to pay its debt:
Dollar gains against EURO and YEN (makes no sense)
Gold and Silver fall (makes no sense)
10-year treasury yields marginally increase (makes no sense, should have been higher move up)
The only saving buzzword left for the 1981 – 2023 Secular Bull market is FOMO.
Are we looking at a 10-15 year Secular Bear market? Probably.
Debt doesn’t matter until it finally does matter and that will be the cause of a Secular Bear market.
Is the ISM report today just another ‘hint’ that debt and the service sector is all that is left? Probably.
The next year is going to be very interesting indeed.
Plunge protection team making sure USD doesn’t reflect true value. Working OT today.
While others have noted this is the second time that US securities have been downgraded, the first time was immediately retracted due to pressures from every powerful institution on earth that depended upon them being perceived as trustworthy. That isn’t happening this time. For a very good reason. The same reason I’ve been giving since the first digital currency collapse. They need to rid the competition in crypto, so that they can replace it with that fancy new digital currency the central banks are all fawning over right now in their massive propaganda push for it. For it to happen though, the dollar needs to crash. Never mind the economic destruction, that’s just an added bonus for narcissists. They do love making everyone miserable. Once we get our new “secure” digital currency that will be instantly hacked by every 12 year old on the planet, we can have our social credit system and everything you buy can be tracked and traced and therefore controlled by idiots. Which makes you an idiot for getting under their thumb to start with, but I digress. Of course, some of you believe that you are stock market whales, what with your $10 portfolios and all, and think we should just shut up and make more of that soon to be confederate money. I have no agenda. I have no plan. I have no ambition. My life is already far better than I could have imagined as a young man. But, I do have a lot of hip waders, because the crap is going to get deeper the further we go. So hilarious how people insist on the worst possible outcomes in their lives. I can’t change that, but I can enjoy the ride. And I do.