U.S. economy skids to a stall

Commentary: Housing is ‘The Word That Cannot Be Spoken’

 

This week is stumbling to an end, with markets largely unchanged and I think exhausted at the sight of nonfunctioning government here and over there.

Ten-year Treasury notes did rise to 2.1 percent, from an all-time bottom of 1.9 percent, but either value is an emergency trade, and the rise did little to mortgage interest rates, still in the 4.125 to 4.25 percent range, and which three weeks ago stopped following the 10-year Treasurys down.

The economy is conjugating the verb: “stall.” Stalling, stalled, will stall … the National Federal of Independent Business small business index fell for the sixth straight month, and is now back to recession levels.

Industrial production rose a not-so-mighty 0.2 percent in August, and regional surveys found a slower rate of slowing.

August retail sales were flat, with a precisely zero change. In modest good news, layoffs have stalled, too, so there is no real change in the number of newly unemployed.

The Federal Reserve next Wednesday will announce a new effort to help the economy — the stronger the measure, perversely the more likely to push up mortgage rates in optimism.