Texas Economy Collapses – Dallas Fed Survey Crashes To 6-Year Lows As “D” Word Is Uttered
For the 13th month in a row, The Dallas Fed Manufacturing Outlook was contractionary with a stunning -34.6 print following December’s already disastrous collapse back to -20.1, post-crisis lows. With “hope” having plunged back into negative territory (-2.2) in December, January saw a complete collapse to -24.0 as one respondent exclaimed, “we expect the continued depression in the oil and gas industry to negatively impact our customer base and result in significant demand reduction.“
Bloodbath…
And its across the board with production, employment, and shipments all collapsing…
As hope is crushed…
Chart: Bloomberg
But the punchline was the respondents, virtually all of whom confirm the recession, and one even casually tossed in the “D”(epression) word:
Primary Metal Manufacturing
- The impact of the continued decline in the energy sector, compounded with several new regulations from both the Environmental Protection Agency and Occupational Safety and Health Administration, is depressing economic conditions even further from 2015. Our top 10 customers continue to indicate declines in manufacturing and new capital expenditures for 2016. Outlooks continue to be adjusted down from six months ago, and we are seeing several foundry closings in our industry due to the state of our industry and strong offshoring projects.
- Our projected increase in business is related to market-share gains at the expense of our main competitor (foreign owned) who is having service problems.
Fabricated Metal Product Manufacturing
- We expect the continued depression in the oil and gas industry to negatively impact our customer base and result in significant demand reduction.
- I believe that if the stock market continues to deteriorate, spending on housing replacement products will decrease. Large purchases on housing seem to parallel consumers’ 401k performance.
- It is getting pretty ugly, and the strength of the dollar is really making us noncompetitive.
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