Thread by @gg_veritas

#US #IndustrialProduction numbers were released yesterday for Apr-end. The picture isn't pretty. Showing below how bad it was in the last 2 months in actual numbers. (comparing Feb-end with Apr-end; Grey areas show previous recessions). The index itself declined 15.3% (1)

PART1: Industries underperforming the IP Index

1. #MotorVehicles & Parts - down 80% in 2 months. It's the LOWEST since 1972. (2)

2. #DurableConsumerGoods - down 47% in 2 months (3)

3. #Printing and related activities - down 30% in 2 months for an industry in a secular decline since last recession. (4)

4. #Aerospace - down 28.6% in 2 months. $BA and #airlines having a really bad time. No wonder the Oracle of Omaha sold all his stake in airlines. (5)

5. #Furniture and related products - down 25.8% in 2 months, the lowest seen since 1982. (6)

6. #Petroleum and coal products - down 24% in 2 months. Demand shock led to negative $wti levels in April for May contracts. (7)

7. #PrimaryMetals - down 23.5% in 2 months (8)

PART2: Industries outperforming Industrial Production Index

1. #NaturalGas distribution - up 5.7% in last 2 months; noisy data here but it's doing what utilities are expected to do i.e. stay relatively stable

(9)

2. #Paper - down minor 2.7% in last 2 months. Guess the initial #toiletpaper rush helped this industry; was flat Feb-end to Mar-end. (10)

3. #ElectricUtilities & #GasUtilities - down 2.8% in 2 months. This probably is where one "buys the dip" given how the industry has been a secular grower and provides reasonable protection in downturns (11)

4. #Computer & #Electronic products - down 6% in 2 months of which 5% came in last 1 month alone. This industry might come under pressure short-term given the #Huawei news again. (12)

5. #Chemicals - down 6.6% in 2 months. Looks like a small blip in grand scheme of things. Expect this industry to be resilient. Why? The pharma producers and disinfectant producers fall in this group. (13)

6. #Food, #Beverages and #Tobacco - down 8.5% in 2 months. The decline this time around is more severe than 2007-08 crisis. Signs of deflation in consumer demand of non-essentials food products? (14)

7. #Wood products: showing some stress despite retail demand to renovate homes in lockdowns. If housing is impacted in this recession, expect this industry to cross 2007-08 lows. I'll be watching #Lumber for signs of demand, has been showing some resilience off late. (15)

#Fed is obviously watching all this and the recent headlines about the possibility of "significantly lower asset prices" makes me think that now they are thinking about "Solvency" issue and not just "Liquidity" issue.

Is #Powell coming on TV tomorrow to address this? We'll see.

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