The failure of financial media to grasp the real story behind economic developments never ceases to amaze us here at Hedgeye.
Case in point: Despite pessimistic reports of a “fall,” “backslide” or “decline” – take your pick of verbiage – the mainstream media got May’s Durable Goods report all wrong. A more thorough and thoughtful analysis of the economic data, reported earlier this week, paints an entirely different picture: The U.S. economy is accelerating.
“There’s a lot of negativity surrounding headlines in MSM but they are mischaracterizing the data,” says Hedgeye U.S. Macro analyst Christian Drake in the video above from The Macro Show earlier today.
Here are some key numbers:
- Headline Durable Goods accelerated from +0.7% year-over-year in April to +2.7% in May
- Durable Goods Ex-Defense & Aircraft (a proxy for household consumption) accelerated from +3.7% year-over-year in April to +5.3% in May. That’s a 33-month high.
- Capital Goods (Capex) accelerated from +3.1% year-over-year growth in April to +5.0% in May. That’s another 33-month high.
From our perch, that certainly doesn’t look like a “fall,” “backslide” or “decline.”
Don’t take our word for it, watch the video above.
