Glass Half Empty, Glass Half Full
We have entered our 34th consecutive month of expansion in American manufacturing, the longest such increase in almost 17 years. There was no such winning streak even during the supposedly boom years of the Clinton administration. We know this boom is real, however, because it has been ages since there has been a rush of mainstream media stories about the collapse of American manufacturing.
The data actually comes from the ISM Manufacturing Report on Business® PMI History.
It's interesting to see how the figures -- apparently the same figures -- are reported by MSNBC. Here it is, verbatim, from US manufacturing growth eases in May
By Christopher Swann in Washington and John O'Doherty in New York Updated: 7:42 p.m. ET June 1, 2006 FT.Com
Manufacturing activity slowed to a nine-month low in May, adding to evidence that the US economy is starting to lose momentum after blistering first-quarter growth. The ISM manufacturing index slid to 54.4 in May from 57.3. Any figure above 50 indicates expansion, but the rate of growth has been slowing.
The prices paid index of the report climbed to 77 from 71.5 - driven largely by rising crude oil prices rather than generalised inflationary pressure. "While the latest reading is not a disaster, it is consistent with GDP growth of slightly below 3 per cent," said Paul Ashworth, senior US economist at Capital Economics, a consultancy.
It's apparently possible for the growth to have occurred, because Europe is also experiencing a manufacturing boom. But the FT.Com, associated with the earlier story, puts this news another way. Eurozone manufacturing growth hits six-year high:
By Ralph Atkins in Frankfurt Published: June 1 2006 10:49 | Last updated: June 1 2006 10:49
Eurozone manufacturing growth has reached the fastest rate for almost for six years, according to the latest figures that suggest the economic upswing in the 12-country region has extended well into the second quarter of this year. The unexpected rise in the eurozone manufacturing purchasing managers' index, from 56.7 in April to 57.0 in May, marked the eleventh successive monthly improvement in business conditions
So there you have it folks. Thirty four months of expansion and the word is "eases". Eleven months of expansion and "six-year high" is the appropriate descriptor. Anyhow, is this good news?