● US Home builders grow more confident in November | LA Times
● Senate defeats Keystone oil pipeline | USA Today
● US producer inflation up, but underlying trend muted | Reuters
● Yellen Inherits Greenspan’s Conundrum as Long Rates Sink | Bloomberg
● Calling Early Elections in Japan, Abe Rolls Dice on Economy | NY Times
● OECD raises India growth outlook, urges reforms | Reuters

Housing starts are expected to increase to an annual pace of 1.022 million in tomorrow’s update for October, according to The Capital Spectator’s median point forecast for several econometric estimates. The projection represents a modest increase over September’s 1.017 million.
Continue reading →

The momentum factor in asset pricing is widely recognized and respected, but there’s nothing close to consensus on the best definitions for what is arguably the most durable “anomaly” in the markets. A quick review of the voluminous literature on the subject reveals a variety of methodologies—absolute vs. relative momentum or price-based vs. return-based strategies, for instance. But the common theme that unites all definitions and strategies in this space is a focus on trending behavior for short- to medium-term horizons. Although minds will differ on the ideal for measuring and exploiting this phenomenon, a reasonable way to begin is by comparing an asset’s latest closing price to a variety of simple moving averages.
Continue reading →

● German Economic Sentiment in Nov increased for the first time in 2014 | ZEW
● UK inflation rate rises to 1.3% | BBC
● Analysts: US Economy Strong Despite Drop In Oct Industrial Output | MNI
● Five more Ukrainian soldiers killed, German foreign minister visits Kiev | Reuters
● Israel: ‘We will respond with a heavy hand’ after synagogue attack kills 4 | CNN
● ECB’s Draghi: Government Bond Purchases Possible | ABC

Industrial activity dipped 0.1 percent last month, clawing back a portion of the 0.8 percent rise in the previous month, the Federal Reserve reports. The slump surprised analysts, who were expecting a 0.3% gain, according to Econoday.com’s consensus forecast. The manufacturing component, however, posted a modest 0.2% rise, which tells us that last month’s weakness wasn’t broadly based. Nonetheless, the soft numbers in October weighed on the year-over-year trend, leaving industrial production rising 4.0% — the slowest pace in six months.
Continue reading →

● Japan Prepares Stimulus After Unexpectedly Tumbling to Recession | Bloomberg
● Global economy to suffer as Putin quits G20 early | Telegraph
● Euro zone trade surplus jumps y/y in Sept on stronger exports | Reuters
● Australia, China seal free-trade agreement | Marketwatch
● Low Gas Prices to Support US Confidence, Sales Ahead | MNI
● House, Senate To Vote On Bill Approving Keystone XL Pipeline | RTT

US industrial production in October is projected to increase 0.2% vs. the previous month in tomorrow’s report from the Federal Reserve, according to The Capital Spectator’s median point forecast for several econometric estimates. The expected gain represents a substantial deceleration in growth relative to September’s 1.0% advance.
Continue reading →

● The Colder War: How the Global Energy Trade Slipped from America’s Grasp
by Marin Katusa
Interview with author via Yahoo Finance
“President Putin has clearly broken the [Sept. 5] truce agreement,” NATO Secretary General Jens Stoltenberg told Germany’s Bild newspaper but, thus far, traders don’t seem to care — perhaps pulling from the same playbook as earlier this year when Russia annexed Crimea.
But “the problem is going to get worse and it is going to get bloodier,” says Marin Katusa, chief energy strategist for Casey Research. “More importantly [Ukraine] is central to [Putin’s] theme of not only making Europe more dependent on Russian oil and natural gas but at the same time he is also expanding his output of energy to countries like China so he’s got a double-pronged approach.”
In his new book, The Colder War, Katusa examines Putin’s long-term strategy of returning Russia to global superpower status via strategic use of its primary weapon: Energy.
Continue reading →

Retail sales increased 0.3% in October, the Census Bureau reports — in line with expectations. The annual growth rate for spending slipped modestly, advancing 4.1% for the year through last month vs. 4.4% in the previous update. Nonetheless, today’s data shows that the consumption trend on Main Street remains comfortably in the 4%-plus range, which has prevailed since March. One reason for expecting that sales will remain on a moderate growth path: falling gasoline prices, which have provided a substantial boost to disposable income lately.
Continue reading →

The monthly housing numbers for October start rolling in next week, which will renew the focus on the key question: Is this crucial sector of the US economy still a risk factor for the business cycle? Recent data looks a bit more encouraging vs. the softer trend from earlier in the year, but housing’s growth remains sluggish compared with the robust gains in 2012 and 2013. For the moment, however, the worst fears have receded, although it’s still unclear if the trend will stabilize at a lesser growth rate. We’ll have a clearer picture of what lies ahead after the next batch of figures arrive, starting with next week’s update (Nov. 19) on new residential construction. Meantime, let’s review how the numbers stack up on three key indicators: new home sales, existing home sales, and housing starts, followed by a look at the outlook for prices.
Continue reading →