This week we are going to examine the headline data we all see and then take a look for what most observers do not see. Then we'll try to think about what it all really means. With employment, housing, and the ISM numbers, there is a lot to cover. And this letter will print out longer than usual, as there are a lot of charts. Warning: sharp objects from the vicinity and pour yourself your favorite adult beverage. This does not make for fun reading. But first, a very quick three-paragraph commercial.

• 3. The initial unemployment claims 4-week moving average stubbornly refuses to go down any further. It has essentially gone sidewa If you go back and look at the data from the last 45 years, the current level is typical of recessions. Earnings Take a Hit No, not business earnings, which seem to be holding up, but personal earnings. Average hourly earnings dropped 0.1% in June, s Rosenberg notes is a 1-in-50 event. The trend is downward, with annual growth of less than 1.7%. Average hours worked were als My friend and Maine fishing buddy Bill Dunkelberg, chief economist at the National Federation of Independent Businesses, has pro survey, and there was not much to cheer about from a future employment perspective. Over the next 3 months, 8 percent of the b plan to reduce employment (up 1 point), and 10 percent plan to create new jobs (down 4 points), yielding a planning to create new jobs, unchanged from May and only the second positive reading in 20 months - but barely so.
• 4. From Dunk's email: "Since January, 2008, the seasonally adjusted average change in employment per firm has been negative in e seasonally adjusted loss of 0.3 workers per firm reported in June for the prior three month period. Most firms did not change empl points from May) increased average employment by 3.4 employees, but 15% (down 5 points) reduced their workforces by an aver creation" still hasn't crossed the 0 line in the small business sector. Government (including health care and education) and manuf activity) has been providing what few jobs are created, weak given the magnitude of employment loss during the recession. And n temporary Census jobs will make the picture look more bleak, although more accurate. A few more every month for 3 years to re-employ 8 million workers who lost their jobs and another 125,000 a month to keep up with population A few more data points from this week, and then let's look at some of the implications. The numbers from the Conference Board su total of people planning to buy a major appliance is at an almost 16-year low. Car sales were low last month, and the survey says t plans to buy a car are down from 6% to 3.7%. In fact, in almost all categories plans to buy were down. Which makes sense, as 17% incomes are decreasing. New home inventory is back up to 8.5 months of supply. As noted above, single-family sales hit an all-time low, as anyone who wan did so in order to get the government incentive. Just as with Cash for Clunkers, all we did was bring buying forward; we did not cre buyers, at least not in any significant numbers. Money Supply Concerns After the explosion in the money supply by the Fed in the depths of the Great Recession, growth in the money supply has gone fla at the fact that M-3 (the broadest measure of money supply) has turned negative for the first time in many decades. Look at the ad base, below.