An avalanche of economic data today continues to build a case for the economy coming to life, and ready to live up to its potential, but there are troubling issues.

Manufacturing

“Respondents to our survey also remain optimistic about business activity in 2017…”

• New orders rose from 52.5 to 63.2
• Production rose from 54.4 to 59.1
• The orders backlog rose from 44.4 to 52.8
• Supplier delivery times rose from 51.2 to 53.9
• Prices paid fell from 59.5 to 56.8
• Employment fell from 51.1 to 49.7

The lone red flag from the Chicago PMI report is employment, which slipped to contraction and underscored by the ADP November employment report.

Goods Producing -11,000

• Mining -4,000
• Manufacturing -10,000
• Construction +2,000

Despite the great news that Carrier is keeping half the jobs it previously announce would move to Mexico, the news mask the fact half aren’t being kept.  Moreover, the rapid implementation of robots, software, and artificial intelligence is a tsunami that will leave lots of hard working folks out in the cold. This isn’t new per se and has been in the works since mankind learned to employ levers.