U.S. Economy Grew at Faster Pace than Expected in Q3
The Bureau of Economic Analysis (BEA) reported the second estimate for third-quarter (Q3) 2019 gross domestic product (GDP) rose to 2.1%, higher than the consensus forecast. Real GDP rose by 2.0% in Q2 2019.
Forecasts ranged from a low of 1.7% to a high of 2.1%. The consensus forecast was 1.9% and the forecast for the advance was just 1.6%.
The upward revision was fueled by private inventory investment, nonresidential fixed investment, and personal consumption expenditures (PCE), or consumer spending.
Consumer spending was revised higher to 2.9%. Forecasts ranged from a low of 2.8% to a high of 3.0%. The consensus forecast was 2.8%.
Real gross domestic income (GDI) rose 2.4%, up strongly from 0.9% (revised) in Q2. The average of real GDP and real GDI — which is a supplemental measure of U.S. economic activity that equally weights GDP and GDI — gained 2.3% in Q3, up from 1.4% in Q2.
This article will be updated shortly to reflect more data.
Rep. Jerry Nadler, D-N.Y., the Chairman of the House Judiciary Committee, speaks to reporters demanding the unredacted version of the Mueller report on April 3, 2019.
Rep. Jerry Nadler, D-N.Y., the Chairman of the House Judiciary Committee, announced an impeachment hearing has been scheduled for December 4. The hearing will be called the “Impeachment Inquiry into President Donald J. Trump: Constitutional Grounds for Presidential Impeachment”.
“Our first task is to explore the framework put in place to respond to serious allegations of impeachable misconduct like those against President Trump,” Chairman Nadler said in a statement.
The effort to impeach President Trump initially began in the Judiciary Committee, as is traditionally and historically the case. However, Chairman Nadler was viewed by House Speaker Nancy Pelosi, D-Calif., as ineffective.
Prior Judiciary Committee hearings starring Robert Mueller and Corey Lewandowski, which were meant to launch a true formal impeachment process, were political disasters. The hearings in the Intelligence Committee have thus far failed to sway public opinion.
House Democrats voted on an impeachment “resolution” codifying the existing “inquiry” and empowered Rep. Adam Schiff, D-Calif., the Chairman of the Intelligence Committee who falsely claimed to have evidence of “collusion” for nearly three years.
The vote was bipartisan insomuch as all Republicans and two Democrats voted against it. Following the Intelligence Committee hearings, a number of Democrats who voted in favor of the inquiry are now privately pushing for censure, instead.
The hearings in Chairman Nadler’s committee will feature impeachment-friendly “legal experts” to testify on the “facts that have been found.”
White House: Trump’s Salary Will “Continue the Ongoing Fight Against the Opioid Crisis”
Scrabble-like text depicting opioids on an American flag to underscore the opioid epidemic in the United States. (Photo: AdobeStock)
President Donald Trump is donating his third-quarter (Q3) 2019 salary to help fight the nation’s opioid crisis, the White House confirmed. The president, who is required by law to be paid, has made good on his campaign pledge to donate his salary each quarter.
In Q2 2019, he donated his salary to the surgeon general’s office. The U.S. Department of Education among others has also benefited from the pledge.
The $100,000 he would be paid this quarter will be donated to the Office of the Assistant Secretary of Health. The White House says the funds are being earmarked “to continue the ongoing fight against the opioid crisis.”
The president campaigned on combating the nation’s opioid epidemic. As commander-in-chief, he has made the scourge a central focus of his administration.
In 2018, it claimed the lives of almost 47,000 Americans. That is down from the more than 70,000 Americans who died in 2017 from largely opioid-related drug overdoses.
In October 2018, President Trump signed into law the most significant and sweeping legislation to date to combat the nation’s opioid crisis. In 2018, alone, he had signed into law nearly $5 billion in funding to address the opioid crisis.
The SUPPORT for Patients and Communities Act allows the U.S. Postal Service to scan packages for illicit opioids, increases funding for recovery centers, and expands Medicaid to cover a larger array of treatment options for patients struggling with opioid addiction.
The Chicago Fed National Activity Index (CFNAI) slowed further for October, coming in at -0.71 and missing the consensus forecast. The index’s 3-month moving average (CFNAI-MA3) fell to –0.31 in October from –0.21 in September.
Forecasts ranged from a low of -0.50 to a high of 0.05. The consensus forecast was -0.20.
Two of the four broad categories of indicators that make up the index decreased from September, and all four categories made negative contributions to the index in October.
Production-related indicators weighed heavily on the index. Together they contributed –0.55 to the CFNAI in October, down from –0.36 in September. That’s largely the result of industrial production falling 0.8% in October after declining by 0.3% in September.
Survey of Consumers Holding at Levels Not Seen Since 1998-2000
The Survey of Consumers final reading on consumer sentiment in November ticked higher to 96.8, beating the forecast range. The ≥ 90.0 average is a level of optimism not seen this century.
That’s up from the preliminary reading of 95.7 for November and from 95.5 in October. It is the highest reading in four months.
Forecasts ranged from a low of 93.0 to a high of 96.0. The consensus forecast was 95.7, mirroring the prior reading.
The final reading for November is nearly identical to the average level since the start of 2017 (97.0). The date is marked by the Inauguration of President Donald J. Trump.
In 30 of those 35 months consumer sentiment was 95.0 or higher, a level rivaled only by the period from January 1998 to December 2000. During that period, the Sentiment Index was above 100.0 for 34 out of 36 months.
One side anticipates a recession, while the other side expects an uninterrupted expansion in the year ahead. To be sure, there is ample reason for both optimism as well as pessimism, but not the extreme differences voiced by these groups.
The Philadelphia Fed Manufacturing Business Outlook Survey rose 5 points to 10.4 in November, indicating factory activity in the region was stronger than expected.
The percentage (30%) of firms reporting an increase in activity exceeded the percentage (20%) reporting a decrease.
Forecasts ranged from a low of 3.0 to a high of 8.7. The consensus forecast was only 7.0.
Employment Gains at Slower Pace
While regional manufacturing firms reported an overall increase in employment this month, the current employment index fell 11 points to a still positive 21.5. Nearly 27% of the firms reported an increase in employment, down from 34% last month.
Over 5% of the firms reported decreases in employment this month, while 68% reported no change. The average workweek index also decreased but remained positive.
Regional Firms Remain Optimistic
The diffusion index for future general activity rose 2 points to 35.8 after increasing 13 points in October (see Chart). Nearly 52% of the firms expect increases in activity over the next six months, while 16% expect declines. The future new orders index held steady, while the future shipments index decreased 2 points.
The future employment index rose 2 points from the previous month, as firms remained optimistic about future hiring: Thirty-seven percent (37%) of the firms expect higher employment over the next six months.
However, firms were less optimistic about future capital spending. The index fell 17 points to its lowest reading in three years.
The advance estimate for initial jobless claims came in at 227,000 for the week ending November 16, unchanged and higher than the consensus. The 4-week average came in at a seasonally adjusted 221,000.
Forecasts ranged from a low of 215,000 to a high of 221,000. The consensus forecast was 217,000.
Lagging Jobless Claims Data
The advance seasonally adjusted insured unemployment rate remained unchanged at a very low 1.2% for the week ending November 9. The advance number for seasonally adjusted insured unemployment during the week ending November 9 was 1,695,000, up 3,000 from the previous week.
The 4-week moving average was 1,693,000, an increase of 3,000. The previous week’s average was revised up by 2,250 from 1,687,750 to 1,690,000.
No state was triggered “on” the Extended Benefits program during the week ending November 2.
The highest insured unemployment rates in the week ending November 2 were in Alaska (2.3), Puerto Rico (2.1), New Jersey (1.9), California (1.7), Connecticut (1.6), Pennsylvania (1.5), the Virgin Islands (1.5), West Virginia (1.5), and Washington (1.4).
The largest increases in initial claims for the week ending November 9 were in California (+6,484), New Jersey (+5,197), New York (+2,721), Texas (+2,532), and Minnesota (+2,117), while the largest decreases were in Colorado (-794), Arkansas (-458), Montana (-188), Vermont (-27), and Arizona (-14).
President Donald J. Trump speaks on the phone with Mexican President Enrique Peña Nieto on Jan. 27, 2017.
Key witnesses for House Democrats in the impeachment inquiry have significantly contradicted each other and themselves in sworn testimony.
David Holmes Contradicts William Taylor
David Holmes, an aid to Ambassador William Taylor, contradicted his boss regarding when he recalled having “first-hand evidence” of the content of a phone conversation between Ambassador Gordon Sondland and President Trump.
In the written statement prepared and delivered publicly, Ambassador Taylor stated Mr. Holmes told him for the first time the prior week about what he allegedly overheard.
Last Friday, a member of my staff told me of events that occurred on July 26. … [I]n the presence of my staff at a restaurant, Ambassador Sondland called President Trump and told him of his meetings in Kyiv. The member of my staff could hear President Trump on the phone …. At the time I gave my deposition on October 22, I was not aware of this information. … As I mentioned in my October 22 deposition, the information and quotes in my testimony are based on my best recollection as well asa review of my personal notes.
William Taylor’s prepared statement on November 13, 2019. Available below.
But in a written statement prepared and delivered privately behind closed doors, Mr. Holmes stated he “immediately told the Deputy Chief of Mission and others at the Embassy about the call with the President and my conversation with Ambassador Sondland.”
He conveniently testified that — while he told others at the State Department — he didn’t tell Ambassador Taylor (his superior) about the call until recently.
[I]n the last week or so, I read press reports [about the impeachment inquiry and] …. came to realize I had first-hand knowledge[.] … It is at that point that I made the observation to Ambassador Taylor that the incident I had witnessed has acquired greater significance, which is what he reported in his testimony earlier this week.
David Holmes prepared statement on November 15, 2019. Available here.
Kristina Kvien preceded Marie Yovanovitch on May 28, 2019, and was succeeded by Ambassador Taylor, but on June 18, 2019. As Corporate Big Media have repeatedly highlighted, Ambassador William Taylor took “copious” and “meticulous” notes.
Yet, nothing about Mr. Holmes recalling what he allegedly overheard appears in his notes, or his sworn testimony. Plainly, both statements cannot be true.
Mr. Holmes also conveyed a false timeline that appears designed to intentionally damage the president.
On July 28, while President Trump was still not moving forward with a meeting with President Zelenskyy, he met with Russian President Putin at the G20 Summit in Osaka, Japan, sending a further signal of lack of support for Ukraine.
David Holmes prepared statement on November 15, 2019. Available here.
The G20 Summit in Osaka took place from June 28 – 29, not in late July. Mr. Holmes’ recollection is simply false, suspiciously false. The meeting between the U.S. and Russian presidents did not take place two days after the July 26 phone call with Ukrainian President Zelenskyy, but a full month prior.
Alexander Vindman Contradicts Himself
Unlike other key witnesses for Democrats, Lt. Colonel Alexander Vindman was actually on the July 25 phone call between Presidents Trump and Zelenskyy. But on Tuesday, not only did he contradict his own prior testimony during his deposition behind closed doors, but also appears likely to have perjured himself and admitted to rank insubordination.
Less serious as the matter of perjury — but one critical to his credibility — Mr. Vindman claimed in his opening statement to be the “principal advisor to the National Security Advisor and the president on Ukraine and the other countries in my portfolio.”
This was, at best, an exaggeration. When pressed by Rep. Mike Turner, R-Ohio, Mr. Vindman was forced to concede to it.
“You’ve never spoken to the president and told him advice on Ukraine,” Rep. Turner asked. “That is correct,” Vindman admitted.
Far more serious was Mr. Vindman all but admitting to leaking information to the “anonymous whistleblower” who spoked the impeachment inquiry. When Rep. Devin Nunes, R-Calif., the Ranking Member of the Intelligence Committee, asked him who he spoke with about the July phone call between Presidents Trump and Zelenskyy, Mr. Vindman cited Deputy Assistant Secretary of State George Kent and unnamed individual within the intelligence community.
Rep. Adam Schiff, D-Calif., the Chairman of the Intelligence Committee, interrupted to prevent him from answering the question.
“We need to protect the whistleblower. Please stop,” Rep. Schiff said in a huff. “I want to make sure that there is no effort to out the whistleblower through these proceedings.”
However, in his testimony during the closed-door deposition, Mr. Vindman claimed to not know the “anonymous whistleblower” and repeated that assertion in the public hearing on Tuesday.
It was clear Mr. Vindman was at least one source anonymously mentioned in the whistleblower complaint, written by Democratic lawyers known to be involved in efforts to impeachment the president since his inauguration.
Mr. Vindman also contradicted his outgoing boss, Tim Morrison, the Senior Director for European Affairs on the National Security Council. In his testimony both behind closed doors and publicly, he claimed to have followed the chain of command.
Mr. Morrison had a very different view, one that casts Mr. Vindman as so untrustworthy that he was forced to exclude him from his conversations with Ambasador Taylor.
He testified that Mr. Vindman had an “unfortunate habit” of breaking and outright defying the chain of command.
New Residential Construction Stronger than Expected in October
Housing starts and building permits came in much stronger than forecasts expected in October, the U.S. Census Bureau reported on new residential construction.
Housing Starts
Privately‐owned housing starts in October were at a seasonally adjusted annual rate of 1,314,000, or 3.8% (±8.7%) higher than the revised September estimate of 1,266,000. It’s 8.5% (±10.8%) higher than the October 2018 rate of 1,211,000.
Single‐family housing starts in October were at a rate of 936,000, or 2.0% (±6.3%) higher than the revised September figure of 918,000. The October rate for units in buildings with five units or more was 362,000.
Forecasts ranged from 1,262,000 to 1,360,000. The consensus was 1,266,000.
Building Permits
Privately‐owned housing units authorized by building permits in October were at a seasonally adjusted annual rate of 1,461,000. This is 5.0% (±1.7%) higher than the revised September rate of 1,391,000 and is 14.1% (±2.1%) higher than the October 2018 rate of 1,281,000.
Single‐family authorizations in October were at a rate of 909,000, a gain of 3.2% (±1.0%) from the revised September figure of 881,000. Authorizations of units in buildings with five units or more were at a rate of 505,000 in October.
Forecasts ranged from 1,336,000 to 1,400,000. The consensus was 1,391,000.
Housing Completions
Privately‐owned housing completions in October were at a seasonally adjusted annual rate of 1,256,000. This is an increase of 10.3% (±11.7%) from the revised September estimate of 1,139,000 and is 12.4% (±11.7%) above the October 2018 rate of 1,117,000.
Single‐family housing completions in October were at a rate of 897,000, an increase of 4.5% (±10.3%) from the revised September rate of 858,000. The October rate for units in buildings with five units or more was 354,000.
The NAHB/Wells Fargo Housing Market Index (HMI) finds builder confidence held strong in November at 70, a slightly miss edging down only one point. Forecasts ranged from a low of 70 to a high of 72. The consensus forecast for the HMI was 71.
Still, homebuilder sentiment has held above 60 since February 2019 and the past two months mark the highest sentiment levels for the entire year.
“Single-family builders are currently reporting ongoing positive conditions, spurred in part by low mortgage rates and continued job growth,” said NAHB Chairman Greg Ugalde. “In a further sign of solid demand, this is the fourth consecutive month where at least half of all builders surveyed have reported positive buyer traffic conditions.”
The NAHB has been conducting the Housing Market Index (HMI) for 30 years. The HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.”
The current sales conditions index ticked down two points to 76, and the index for traffic of prospective buyers edged down one point to 53. The NAHB cited inventory shortages as the factor impacting burying traffic.
The HMI also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.
“We have seen substantial year-over-year improvement following the housing affordability crunch of late 2018, when the HMI stood at 60,” said NAHB Chief Economist Robert Dietz. “However, lot shortages remain a serious problem, particularly among custom builders.”
“Builders also continue to grapple with other affordability headwinds, including a lack of labor and regulatory constraints.”
But builders also see brighter days ahead. The index component for sales expectations in the next six months edged higher by one point to 77.
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