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Economy

Coronavirus Mitigation Hit New Residential Construction Hard By April

Washington, D.C. (PPD) — New residential construction took a hit in April as both housing starts and building permits posted significant declines, the U.S. Census Bureau reported.

Builder confidence and residential construction, hew homes, housing starts, building permits, depicted on blueprints. (Photo: AdobeStock)
Builder confidence and residential construction, hew homes, housing starts, building permits, depicted on blueprints. (Photo: AdobeStock)

Housing Starts

Privately-owned housing starts in April came in at a seasonally adjusted annual rate of 891,000. That’s down 30.2% (±11.0%) from the revised March estimate of 1,276,000 and 29.7% (±8.1%) from the April 2019 rate of 1,267,000.

Single-family housing starts in April fell to a rate of 650,000, or 25.4% (±9.6%) lower than the revised March figure of 871,000. The April rate for units in buildings with five units or more came in at 234,000.

Forecasts for housing starts ranged from a low of 750,000 to a high of 1,000,000. The consensus forecast was 968,000.

Building Permits

Privately-owned housing units authorized by building permits came in at a seasonally adjusted annual rate of 1,074,000 in April. That’s down 20.8% (±0.9%) from the revised March rate of 1,356,000 and 19.2% (±0.9%) from the April 2019 rate of 1,330,000.

Single-family authorizations in April fell to a rate of 669,000, down 24.3% (±1.6%) from the revised March figure of 884,000. Authorizations of units in buildings with five units or more came in at a rate of 373,000 in April.

Forecasts for building permits ranged from a low of 750,000 to a high of 1,150,000. The consensus forecast was 1,033,000.

Housing Completions

Privately-owned housing completions in April came in at a seasonally adjusted annual rate of 1,176,000, or 8.1% (±13.5%) below the revised March estimate of 1,279,000. That is 11.8% (±9.9%) below the April 2019 rate of 1,334,000.

Single-family housing completions fell to a rate of 865,000, down 4.9% (±16.7%) from the revised March rate of 910,000. The April rate for units in buildings with five units or more came in at 304,000.

There is no forecast range or consensus forecast for housing completions.

On Friday, the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) finds builder confidence ticked higher to 37 in May, beating the consensus forecast. Still, efforts to “slow” the spread of the Chinese Coronavirus (COVID-19) have taken a toll.

In January, builder confidence in the market for newly-built single-family homes edged just one point lower to 75 from December 2019. The two monthly readings marked the highest sentiment levels since July of 1999.

New residential construction took a hit in

Inside the Numbers

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Politics

WHO Must Make ‘Substantive Improvements’ or Funding Freeze Becomes Permanent

President Donald Trump and members of the Coronavirus Task Force, along with Attorney General William Barr, hold a press conference on March 23 2020. (Photo: People's Pundit Daily)
President Donald Trump and members of the Coronavirus Task Force, along with Attorney General William Barr, hold a press conference on March 23 2020. (Photo: People’s Pundit Daily)

Washington, D.C. (PPD) — President Donald Trump has given the World Health Organization 30 days to make “substantive improvements” before the temporary freeze on funding becomes permanent and U.S. membership is reevaluated.

In a four-page letter sent to WHO Director-General Dr. Adhanom Tedros Ghebreyesus on Monday, President Trump detailed in 14 bullet points the WHO’s mishandling of the pandemic.

“it’s clear the repeated missteps by you and your organization in responding to the pandemic have been extremely costly for the world,” the president wrote in a scathing conclusion. “The only way forward for the World Health Organization is if it can actually demonstrate independence from China.”

The WHO has come under intense criticism for promulgating Chinese propaganda. A Five Eyes intelligence report claims China enlisted the help of the WHO to downplay the threat to the virus and cover for their response and its origins.

“At this stage, there is no clear evidence of human-to-human transmission in the novel #coronavirus (2019-nC0V) outbreak in #Wuhan, #ChinaFlag of China,” the WHO tweeted in mid-January. “However, the Chinese authorities continue intensive surveillance and follow-up measures, including environmental investigations.”

In early April, President Trump announced a hold on U.S. funding to the WHO pending an investigation. The letter to WHO Director-General Dr. Tedros, himself a controversial figure with ties to China, lays out the findings of that review.

Earlier on Monday, Secretary of State Mike Pompeo issued a blistering condemnation of the WHO for excluding Taiwan from the World Health Assembly. The World Health Assembly is the decision-making body of WHO.

At the annual event in Geneva, Switzerland, delegations from all WHO Member States hatch out specific health agendas prepared by the Executive Board. Secretary Pompeo made clear the administration believes WHO Director-General Dr. Adhanom Tedros Ghebreyesus caved “under pressure” to China.

President Trump has given the WHO 30

Politics

Secretary Pompeo: Director-General Tedros’ Cave to China ‘Further Damages WHO’s Credibility and Effectiveness’ During Pandemic

World Health Organization (WHO) Director-General Dr. Adhanom Tedros Ghebreyesus delivers his address to the opening session of the 146th Session of the WHO Executive Board on February 3, 2020. (Photo: People's Pundit Daily/PPD)
World Health Organization (WHO) Director-General Dr. Adhanom Tedros Ghebreyesus delivers his address to the opening session of the 146th Session of the WHO Executive Board on February 3, 2020. (Photo: People’s Pundit Daily/PPD)

Washington, D.C. (PPD) — Secretary of State Mike Pompeo issued a blistering condemnation of the World Health Organization (WHO) for excluding Taiwan from the World Health Assembly. He made clear the administration believes WHO Director-General Dr. Adhanom Tedros Ghebreyesus caved “under pressure” to China.

“The United States condemns Taiwan’s exclusion from the World Health Assembly,” Secretary Pompeo said in a statement. “At a time when the world continues to struggle with the COVID-19 pandemic, we need multilateral institutions to deliver on their stated missions and to serve the interests of all member states, not to play politics while lives are at stake.”

The World Health Assembly is the decision-making body of WHO. At the annual event in Geneva, Switzerland, delegations from all WHO Member States hatch out specific health agendas prepared by the Executive Board.

“The main functions of the World Health Assembly are to determine the policies of the Organization, appoint the Director-General, supervise financial policies, and review and approve the proposed programme budget,” the WHO states.

The 73rd World Health Assembly is scheduled to be held virtually from May 18 – 19, 2020. The 147th session for the Executive Board will be held virtually on May 22, 2020.

Taiwan, which China refuses to acknowledge as anything other than a satellite state under Beijing, has been among the most successful nations to contain the coronavirus (COVID-19) pandemic. It’s astonishing given the origin of the outbreak was Wuhan, China.

“WHO’s Director-General Tedros had every legal power and precedent to include Taiwan in WHA’s proceedings,” Secretary Pompeo stated. “Yet, he instead chose not to invite Taiwan under pressure from the People’s Republic of China (PRC).”

“The Director-General’s lack of independence deprives the Assembly of Taiwan’s renowned scientific expertise on pandemic disease, and further damages the WHO’s credibility and effectiveness at a time when the world needs it the most.”

The U.S. credited Taiwan’s success to it being a “transparent, vibrant, and innovative” democracy rather than a totalitarian regime such as China. Beijing has been criticized by the West for mishandling the pandemic. Intelligence gathered jointly by the Five Eyes suggests China misled the world about the pandemic, and enlisted the help of the WHO to do so.

The PRC’s spiteful action to silence Taiwan exposes the emptiness of its claims to want transparency and international cooperation to fight the pandemic, and makes the difference between China and Taiwan ever more stark. Taiwan is a model world citizen, while the PRC continues to withhold vital information about the virus and its origins, deny access to their scientists and relevant facilities, censor discussion of the pandemic within China and on Chinese social media properties, and casts blame widely and recklessly.

Secretary of State Michael Pompeo

The WHO has come under intense criticism for promulgating Chinese propaganda. In early April, President Donald Trump announced a hold on U.S. funding to the WHO pending an investigation into the organization’s handling of the pandemic.

A Five Eyes intelligence report claims China enlisted the help of the WHO to downplay the threat to the virus and cover for their response and its origins. It’s unclear whether that funding will resume at the prior limits or if the U.S. will match the contributions from China.

UPDATE: President Donald Trump tore into the WHO response to the pandemic in a letter to Director-General Tedros. He gave the WHO 30 days to make “substantive improvements” before the temporary freeze on U.S. funding to the WHO becomes permanent and membership is reevaluated.

“it’s clear the repeated missteps by you and your organization in responding to the pandemic have been extremely costly for the world,” the president wrote. “The only way forward for the World Health Organization is if it can actually demonstrate independence from China.”

Secretary of State Mike Pompeo issued a

Markets

The New York Stock Exchange (NYSE) from the street level view of Wall Street Nassau Street during the Conoravirus (COVID-19) outbreak on March 18, 2020. (Photo: People's Pundit Daily)
The New York Stock Exchange (NYSE) from the street level view of Wall Street Nassau Street during the Conoravirus (COVID-19) outbreak on March 18, 2020. (Photo: People’s Pundit Daily)

New York, N.Y. (PPD) — U.S. equity markets surged on Monday after interim data suggested strides are being made during vaccine trials for coronavirus (SARS-CoV-2), or COVID-19.

The Dow Jones Industrial Average (^DJI) gained +911.95, or 3.85% to close at 24,597.37. The S&P 500 (^SPX) gained +90.21, or 3.15% to close at 2,953.91. The NASDAQ Composite (^IXIC) gained +220.27, or 2.44% to close at 9,234.83.

The Russell 2000 (^RUT) was the biggest percentage gainer, closing up +76.70 or 6.10% at 1,333.69.

Moderna, Inc. (MRNA), which specializes in the development of transformative medicines based on messenger ribonucleic acid (mRNA), reported positive interim clinical data for its vaccine candidate. On May 7, the FDA completed its review of the Company’s IND application for mRNA-1273, allowing it to proceed to Phase 2.

Moderna is finalizing protocol for Phase 3 study of mRNA-1273, expected to begin in early summer of 2020. The Phase 1 study led by the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH).

“These interim Phase 1 data, while early, demonstrate that vaccination with mRNA-1273 elicits an immune response of the magnitude caused by natural infection starting with a dose as low as 25 µg,” said Tal Zaks, M.D., Ph.D., Chief Medical Officer at Moderna. “When combined with the success in preventing viral replication in the lungs of a pre-clinical challenge model at a dose that elicited similar levels of neutralizing antibodies, these data substantiate our belief that mRNA-1273 has the potential to prevent COVID-19 disease and advance our ability to select a dose for pivotal trials.”

Moderna closed +13.31, or +19.96% at 80.00.

New York, N.Y. (PPD) — U.S. equity

Economy

HMI Remains Historically Low After Starting 2020 at 20-Year High

The National Association of Home Builders/Wells Fargo Housing Market Index (HMI) finds builder confidence ticked higher to 37 in May, beating the consensus forecast.

Forecasts ranged from a low 32 to a high of 40. The consensus forecast was 33. The HMI still remained historically low after starting 2020 at a 20-year high.

In January, builder confidence in the market for newly-built single-family homes edged just one point lower to 75 from December 2019. The two monthly readings marked the highest sentiment levels since July of 1999.

Efforts to “slow” the spread of the Chinese Coronavirus (COVID-19) have taken a toll.

Methodology (H/T)

The NAHB/Wells Fargo HMI is a weighted average of three separate component indices: Present Single-Family Sales, Single-Family Sales for the Next Six Months, and Traffic of Prospective Buyers. Each month, a panel of builders rates the first two on a scale of “good,” “fair” or “poor” and the last on a scale of “high to very high,” “average” or “low to very low”. An index is calculated for each series by applying the formula “(good – poor + 100)/2” or, for Traffic, “(high/very high – low/very low + 100)/2”. 

Each resulting index is first seasonally adjusted, then weighted to produce the HMI. The weights are .5920 for Present Sales, .1358 for Sales for the Next Six Months, and .2722 for Traffic. The weights were chosen to maximize the correlation with starts through the following six months.

The HMI can range between 0 and 100.

The NAHB Housing Market Index (HMI) finds

Economy

Ann Arbor, Mich. (PPD) — The Survey of Consumers preliminary reading on consumer sentiment ticked higher in May to 73.7, beating the consensus forecast.

MayAprilMarchAprilM-MY-Y
2020202020202019ChangeChange
Index of Consumer Sentiment73.771.889.197.2-19.4%-26.1%
Current Economic Conditions83.074.3103.7112.3-28.4%-33.8%
Index of Consumer Expectations67.770.179.787.4-1

Forecasts ranged from a low of 60.0 to a high of 75.7. The consensus forecast was 66.0.

The Survey of Consumers preliminary reading on

Economy

Total Industrial Production, Manufacturing, Both Post Largest in 101-Year History of Index

Washington, D.C. (PPD) — The Federal Reserve reported industrial production fell 11.2% in April, the largest monthly drop in the 101-year history of the index. It was the direct result of factories slowing or suspending operations to mitigate the spread of the Chinese Coronavirus (COVID-19) throughout the month.

Forecasts for industrial production ranged from a low of -15.0 to a high of -6.2. The consensus forecast was -11.5.

Manufacturing output dropped 13.7%, also the largest decline on record. All major industries posted declines. The output of motor vehicles and parts declined more than 70%, and remaining production in manufacturing fell 10.3%.

Forecasts for manufacturing ranged from a low of -20.0 to a high of -5.0. The consensus forecast was -11.4. The indexes for utilities and mining fell 0.9% and 6.1%, respectively.

At 92.6% of its 2012 average, the level of total industrial production was 15.0% lower in April than it was a year earlier.

Capacity utilization for the industrial sector decreased 8.3% to 64.9% in April, a rate that is 14.9% below its long-run (1972–2019) average and 1.8 percentage points below its all-time (since 1967) low set in 2009.

Forecasts for the Capacity Utilization Rate ranged from a low of 60.0 to a high of 75.7. The consensus forecast was 64.9.

The Federal Reserve said industrial production fell

Economy

New York, N.Y. (PPD) — The New York Federal Reserve Empire State Manufacturing Survey climbed 30 points in May off the record low to -48.5. That’s the second worst reading in the survey’s history.

While the general business conditions index climbed thirty points from the record low set last month, it came in at -48.5, its second worst reading in the survey’s history.

Manufacturing Export Wooden Crate, reading Made in New York. 3D Illustration. (Photo: AdobeStock)
Manufacturing Export Wooden Crate, reading Made in New York. 3D Illustration. (Photo: AdobeStock)

Forecasts ranged from a low of -80.0 to a high of -50.0. The consensus forecast was -65.0. Meanwhile, New York Governor Andrew Cuomo announced an extension to the lockdown until June.

Fifteen percent (15%) said conditions were better in May, while 63% said conditions had worsened. The new orders and shipments indexes also rose, but remained well into contraction territory at -42.4 and -39.0, respectively.

Manufacturing firms in New York expected business conditions to be better in six months. The index for future business conditions gained 22 points to 29.1. The indexes for future new orders and future shipments also reported significant gains.

Indexes for future employment and the average workweek remained modestly positive. However, capital expenditures and technology spending indexes both remained below zero in contraction territory.

New York, N.Y. (PPD) — The Empire

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