There was good news in July. The seemingly inexorable rise in prices of crude oil, wheat, rice, corn, and even some metals (copper especially) eased. After briefly going as high as $145/bbl, crude oil prices backed down to just under $120. Was this a temporary blip? Perhaps but more importantly, odds of the price hitting $200/bbl are certainly much lower now - even if this turns out to have been a brief respite. And whether prices stay down or go back up, more tires will remain inflated (said to help achieve better mileage), fewer miles will be driven, and some consumers have switched to mass transit and may not return to basic driving (getting to and from work or school or similar trips).

On the downside however, the climb in the number of people signing up for unemployment checks intensified. The average number is now well above 400,000 per week. Together with the signals from The Conference Board's Employment Trends Index and the Help-Wanted Online series, all signs point not only to continued but increasing monthly job-loss counts (perhaps reaching an average above 90,000 per month). That isn't good news with respect to consumer attitudes and certainly has a depressing impact on discretionary spending.

Wednesday, August 13

8:30am Advance Retail Sales (Bureau of the Census)

Consumer confidence is very weak. Sales in July reflected that. The trend however probably was in the range of 0.4-to-0.4 percent increases. Excluding cars and gasoline and groceries probably brought the range close to 0.1-to-0.2 percent. That's below the inflation rate. What's more, sales in August and September could be even lower.

Thursday, August 14

8:30am Consumer Price Indexes (Bureau of Labor Statistics)

Prices for food and energy were still picking up in July: $4 gasoline and record high prices for corn, wheat, and rice. But the "core" CPI (which excludes food and energy) has been rising at the 0.2-to-0.3 percent per month trend rate. With some let up in energy and food prices, the overall inflation rate probably backed off a little in August. Don't expect to see the same trend in the "core" rate.

Friday, August 15

9:15am Industrial Production and Capacity Utilization (Federal Reserve Board)

Demand is soft and business is reducing inventory (and carrying charges). Industrial production very likely continued to edge lower again in July. Auto, furniture and appliance, and some high-tech are all cutting back - with little increase elsewhere to offset this declines. None of this is changing in August or likely to change this autumn.

BY THE END OF THE WEEK

The Leading Economic Indicators show softening economic growth across the globe. The recent respite from rising prices helps reduce the economic drag. But housing construction and pricing remains a problem in several economies. Home prices in the U.K. are down almost 9 percent (year-over-year), not quite as big a drop as in the U.S.

Financial market turmoil and slowed credit flow are still taking their toll globally. For example, orders for equipment are down significantly in Europe, an indication that European executives are no more confident of their profit margins going forward than are their American counterparts.

Still, the good news on energy and metal prices has helped allow stock prices across the globe to regain most of the July losses. That good news comes just as the first anniversary of the beginning of the financial panic rolls around. And it is only weeks passed the panic over Freddie Mac and Fannie Mae. Can market participants be reassured of no repeat this summer? In sum, there is some good news to offset all the negative news. That's the best one can see this summer.