MarketWatch: Industry fades

[marmar]

ECONOMIC REPORT
Industrial production drops 1.1% in August
Motor vehicle output plunges 11.9%, says Federal Reserve
By Rex Nutting, MarketWatch



WASHINGTON (MarketWatch) -- Led by a big drop in auto production, U.S. industrial output plunged 1.1% in August, the biggest drop since Hurricane Katrina three years ago, the Federal Reserve reported Monday.

The decline was much worse than the 0.3% decline expected by economists surveyed by MarketWatch. Output in the previous four months was also revised down by a total of half a percentage point. See Economic Calendar.

Industrial production has now fallen 1.5% in the past year and 2% since its peak in January. Industrial production is one of four major indicators used to judge whether the economy is in a recession.

"Manufacturing is in recession, despite the export boom," said Ian Shepherdson, chief U.S. economist for High Frequency Economics.

The report added to a general malaise on Wall Street, where investors were focused intently on the aftermath of Lehman Bros.' bankruptcy.

"The combination of the current financial market turmoil, the weakness in the real economy and the likelihood that the Fed's inflation fears are fading on the decline in oil prices and inflation expectations <. . .> suggests to us that the Fed is likely to cut rates tomorrow," wrote John Ryding and Conrad DeQuadros of RDQ Economics. ......(more)

The complete piece is at: http://www.marketwatch.com/news/story/industrial-production-drops-11-august/story.aspx?guid=%7B4DCB99AE%2D7810%2D4247%2DBC7C%2D7F73EEDB362D%7D

[magellan]

1. AFAIK, our only "export boom" is in arms sales

Oh, and perhaps in people leaving the country for more fertile lands of opportunity.