- by New Deal democrat
This morning brings us two more bits of news that coincide with the story of incipient Recovery.
The University of Michigan consumer confidence index rose to 70.2, and expectations to 69.2, both of which are the second highest readings all year (June was slightly higher).
Meanwhile, the Census Bureau reported that wholesale sales rose +0.5% in July, while inventories fell -1.4%, meaning that the July inventories/sales ratio for merchant wholesalers declined to 1.23.
At the height of the expansion, this ratio was 1.12. It collapsed to 1.35 by January during the economic free-fall. More importantly, tighter inventories ultimately lead to hiring in manufacturing, and this ratio is right where it was in 2002 and early 2003 just before jobs started to increase in the last Recovery.