Housing starts are expected to total 1.160 million units (seasonally adjusted annual rate) in tomorrow’s March report, according to The Capital Spectator’s average point forecast of several econometric estimates. The projection represents a slight decline from the previous month’s level of residential construction activity.
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Foreign stocks posted strong gains last week (in unhedged US dollar terms), with emerging-market equities in the lead. In close pursuit:  stocks in developed markets ex-US. Meantime, bonds suffered over the five trading days through Apr. 15, with foreign corporates posting the biggest decline among the major asset classes, based on a set of proxy ETFs.
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● US industrial output falls in Mar, signals weak Q1 GDP growth | Reuters
● US consumer sentiment weakens in initial Apr reading | MarketWatch
● New York manufacturing expanded in April | AP
● China Says Q/Q Growth in First Quarter 1.1%, Lowest On Record | MNI
● Oil price dives after producers fail to agree output cap | BBC
● Brazil’s lower house votes for Rousseff’s impeachment | CNN
● Slower growth, higher leverage, and more tail risk for economies | Econobrowser

● A Violent World: Modern Threats to Economic Stability
By Jean-Hervé Lorenzi and Mickaël Berrebi
Summary via publisher (Palgrave Macmillan)
During the 1990s Francis Fukuyama announced the end of history. The 2000s showed how it is an illusion to imagine a peaceful world without conflict. In this book, the authors explore how six major constraints are set to fix the trajectory of the global economy. Three of them are new: the aging population, the failure of technical progress, and the scarcity of savings. The other three have been at work for some time: the explosion of inequality, the mass transfer of activities from one end of the world to the other, and the limitless financialization of the economy. They suggest that like seismic activity which depends on pressure between tectonic plates, political and social tensions will be exacerbated in the coming years by these major forces. They propose that authorities will be incapable of preventing neither the date nor the intensity of the coming earthquakes, and ask the question: Are we able to cope with these future shocks and the violence they are sure to cause?
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Manufacturing output in the US contracted for the second straight month in March, according to this morning’s update from the Federal Reserve. The slide weighed on the broader measure of industrial production, which slumped a hefty 0.6% last month. The decline pushed the year-over-year trend for industrial activity deeper into the red. The news raises doubts about the nascent signs of a manufacturing turnaround via the sentiment data.
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Scott Sumner warns that predicting the next recession is a mug’s game. The dismal record on forecasting certainly offers support. “Whenever I hear that someone has accurately predicted a recession, my evaluation of that person declines,” writes the economist at the Mercatus Center at George Mason University. “Economists should not be trying to predict recessions; the point is to prevent them.” Success with the latter may be even more challenging than the former, but that’s an issue for another day. Meantime, Sumner notes that “recession predictions have a corrosive effect on economics as a science.” Why? Because “these predictions lead non-economists to believe that economists should predict recessions, and give undeserved reputational points to lucky permabears.”
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● US Core Consumer Prices in Mar Cool in Sign Pickup Transitory | Bloomberg
● US Jobless Claims Decline as Labor Market Remains Hearty | WSJ
● Consumer Comfort Index in US Rose For First Time In A Month | Bloomberg
● Most Americans in 15 Years Say Their Tax Bill Is Too High | Gallup
● China Growth Slows Slightly In Q1 Amid Signs Of Stabilization | RTT
● Japan earthquake kills nine; more aftershocks expected | CNN

This is as good as it gets… at least by the standard of jobless claims. New filings for unemployment benefits dropped 13,000 last week to a seasonally adjusted 253,000—the lowest since the Watergate scandal was consuming the Nixon administration. Taken at face value, today’s numbers provide cover for dismissing yesterday’s surprise decline in retail spending in March as noise.
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The case for expecting a small-cap equity premium looks shaky. Can we rescue the strategy by focusing on small-cap value stocks? A cautious “yes” has merit, or so it appears after crunching the numbers on the relevant Russell indexes.
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● US Retail sales fall in March to end weak Q1 | MarketWatch
● US business inventories fall slightly in Mar, sales weaken further | Reuters
● Fed Beige Book: Strong Job Market Delivers Higher Wages | WSJ
● GDPNow growth forecast for Q1 ticks up to still-weak +0.3% | Atlanta Fed
● ‘GDPNow’ Got You Down? Meet the NY Fed’s New ‘Nowcast’ | Barron’s
● Just Released: Introducing the FRBNY Nowcast | NY Fed
● Eurozone March Inflation Revised Up To Zero | RTT