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Home Publications Blogs Beat the Press Post Missed the Seasonal Factor in Industrial Output

Post Missed the Seasonal Factor in Industrial Output

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Wednesday, 18 August 2010 06:57

The Federal Reserve Board reported a big uptick in industrial production in July. A large part of the increase was attributable to the fact that the Detroit auto manufacturers did not shut down in July for model changes as they ordinarily do. This led to a reported 8.8 percent rise in auto output for the month since the seasonal adjustments assume that this shutdown takes place. This virtually guarantees a large decline in output for August and is not by itself an indication of improvement in the auto industry.

The Post missed this fact and touted the upturn in auto production.

Comments (12)Add Comment
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written by izzatzo, August 18, 2010 8:40
The Pentagon reported an uptick in the Afghanistan war and a downtick in the Iraq war, both of which fell outside seasonal war adjustments, so expect both wars to continue at current trend levels. Should either war fall below the trend, another war will be started to maintain the overall trend.
enlightenment regression
written by frankenduf, August 18, 2010 9:04
dude, no joke isthatso- how long have we been at 'war' anyway?! (i don't consider these wars, but invasions, but the simpler definition is having troops on foreign soil killing civilians)- i don't think anyone except the naive would be surprised if 20 years from now, pentagon papers are released which document a cynical policy along the lines of your joke, that the propaganda of 'war on terror' includes continuous use of combat troops, both to stimulate aggression on the part of our citizenry, and to pump the military spending economy, now lobbied for and profiteered by very large private corporations
...
written by fuller schmidt, August 18, 2010 11:11
War is everywhere and always an economic proposition, and the military-industrial-complex is raking it in. Folks, we are the fascists. It's very clever then that propagandist Karl Rove(ner) has labeled progressives as the fascists (and communists, terrorists, etc.) to promote his caveman vision.
Blame Wall Street
written by Steve, August 18, 2010 11:27
I'm by no means a fan of the Post's economic reporting. However, they probably just pass on analysis from Bloomberg, Reuters or Wall Street bank analysts. Case in point, Goldman Sachs in a note to clients reported on the data release by touting the uptick in auto production. Here's their money quote:

"Output of motor vehicles and parts rose nearly 10% in July, but gains were widespread across major sectors."

Goldman made no mention of seasonal factors.
...
written by diesel, August 18, 2010 9:19
The moment in history that signaled our doom was when they changed the name of the Dept. of War to the Dept. of Defense. It's been all smoke and mirrors ever since (except of course to the unfortunates on the receiving end of one of our preventative interventions or "preemptive strikes" as the compassionate conservatives prefer to call them).
...
written by rakesh, August 19, 2010 12:02
any idea as to how much did the increased electricity usage( therefore production) contributed to the increased industrial production number?
...
written by rakesh, August 19, 2010 12:04
how much did the increased weather related electricity production contribute to the final industrial production no?
rakesh
written by scott, August 19, 2010 9:02
...or the rising price of gasoline, wheat and other commodities that are inflated based on rank speculation, funded by TARP and Fed subsidized loans--that's double taxation.
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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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