By Dr. Joe Webb on October 4th, 2007
August printing shipments were up $80 million compared to August 2006. They were down -$91 million on an inflation-adjusted basis. For the first eight months of 2007, shipments are up +1.4%, or $921 million on a current dollar basis. They are down on an inflation adjusted basis by $676 million, or by -1%. We have now had seven consecutive down months on the inflation-adjusted series, suggesting that the next three months, the most important of the commercial printing year, might be weaker than last.
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One positive issue that is still unfolding is how aggressive retailers will be with their holiday advertising. Macy's, for example, has had a serious failure in marketing because it attempted to discontinue the use of coupons. Other retailers, we are sure, are taking note of that.
In addition, even though personal income data and household wealth figures have been good, there is a notable economic skepticism among retailers that usually results in greater-than-usual discounting and more advertising expenditures. We don't know until it really happens, as retail forecasts are notoriously bad, but we'll hang onto our optimism anyway.
In other economic news, the ISM non-manufacturing index declined somwhat, but has been positive for four and half years now. Where the manufacturing report's inflation component was good, the non-manufacturing one was not. There's something for everybody in economics, whether they are optimists or pessimists.
Weekly jobless claims moved sideways, giving every pundit something to talk about as they attempt to forecast tommorow's unemployment report. We just forecast that the talking heads will chatter, and would prefer to have the real data.