One of the issues I keep reading about recently is the (alleged) divergence between “soft” and “hard” data. For example, consumer sentiment as measured by the University of Michigan (and the Conference Board, and Gallup) has been making new highs since the Presidential election last November (according to Gallup, mainly fueled by a massive gain in optimism among Republicans). while “hard data,” chiefly industrial production but also including consumer spending, has failed to follow suit.
One problem with this thesis has been that manufacturing as measured by the industrial production index, turned up for five months in a row. It turned down in March, and one good measure of how intellectually honest the commentator is, is whether they have been using a consistent measure for industrial production:
Production as a whole only fell in January and February because of utility production (warm winter in the eastern half of the US). In March, production only rose because utility production rebounded sharply (March was actually colder than February in much of the East).
So a Doomer who was all over the decline in industrial production for the last two months should be touting its advance in March. If the Doomer backs out utilities this month, take a look to see if they did the same thing last month — almost certainly not.
Another problem with the soft/nard data dichotomy is that online retail appears to have reached a tipping point where it is causing big damage to brick-and-mortar retailers, who are laying off thousands of employees and even shutting down completely.
I am concerned that the official real retail sales numbers might not be adequately picking up online retail:
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