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By New_Deal_democrat November 2, 2017 10:42 am
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An economy firing on all cylinders
When it comes to the economy both in the present and over the next 3 to 6 months, there's nary a cloud in the sky.

I won't bother with a graph, but the stock market (which doesn't measure the well-being of the average American, but is a legitimate leading indicator over the next 3 to 9 months), has been going from new all-time high to new all-time high.  

Consumer confidence about present conditions are on a tear (h/t Briefing.com: 

Note that the more leading aspect of expectations of future conditions have been flat since earlier this year.

 The ISM manufacturing index in October just backed off its multiyear peak in September (h/t Bill McBride):

This confirms what we've been seeing in the regional Fed indexes and in the Chicago PMI. Although these measures have been outpacing industrial production this year, they certainly forecast a positive report in that metric as well for October.

After a hurricane-induced hiatus, new jobless claims made a new 40 year low two weeks ago, and came close again this morning:

There was even some good news for average workers in the Q3 employment cost index, which rose 0.7% q/q and 2.5% YoY, the second best showing in this expansion:

Although this is hurricane-related, the bounce back to 18 million annualized vehicle sales is also a significant boost to the economy:

While September residential spending was reported as down slightly from August, and has not made a new high in 3 months (although its decline is less than 1% from that peak):

this is not enough to be of concern yet, and even if it continues to decelerate or decline, it won't hit the overall economy for another year, as is the case of the Q3 decline in real residential investment in the GDP report.

The bottom line is that the economy over the next 3 to 6 months should be about the strongest of this entire expansion.

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