Consumer Economy
- Durable Goods, New Orders (DGORDER) 332.1B -15.6B (-4.48% m/m)
- Median New Home Sales Price (MSPNHSUS) 424.9K +8.40K (+2.02% m/m)
- Auto/Light Truck Sales (ALTSALES) 16.1M +70.0K (+0.44% m/m)
- Personal Income (PI) 26.92T +181.6B (+0.68% m/m)
- GDP (GDP) 31.87T +443.2B (+1.41% q/q)
Durable goods (orders) fell, but last month they hit a new all-time high, so not terrible. Not recessionary.
Auto/Light truck sales were mostly unchanged. Heavy truck sales have continued to rise off the lows in late 2025. Not recessionary.
Home prices rose, home sales dropped, and months of supply rose (+0.9 to 9.4 months). “Let’s raise prices to slow those sales down.” The 9.4 months of supply is getting close to that 2008 housing bubble territory (10-12 months of supply).
Personal Income came in at 8.16% annualized – it sounds nice, but is that keeping up with Bibi-flation?
GDP revised: 1.41% q/q, unadjusted for inflation. Adjusted for inflation: 0.52% q/q. Not recessionary.
But then there’s this:
75% Of US GDP Growth In The First Quarter Was Due To AI [June 25]
…between Software (0.74% of the GDP growth) and Nonresidential Equipment (0.81%), AI – which was the primary driver behind growth in both – contributed just over 1.5% to GDP growth of 2.1%; in other words about 74% of all US growth in Q1 was due to AI.
(source – zerohedge)
Here’s a chart hint about the contribution of computers & equipment investment in 2025-2026. Note this is an MA4 of the underlying (quarterly) series, since it is really choppy, and the core series is just %change from preceding quarter, rather than just a dollar amount. But it gives us a clue as to what’s driving GDP right now.
What could possibly go wrong?
Credit & Rates
- Total Bank Credit (TOTBKCR) 19.63T +7.1B (+0.04% w/w)
- Fed Balance Sheet (WALCL) 6.74T -779M (-0.01% w/w)
- US 30 Year Mortgage Rate (MORTGAGE30US) 6.49% +2 bp
- 1-Month Treasury (DGS1MO) 3.67% +3 bp
- 3-Month Treasury (DGS3MO) 3.75% +0 bp
- 1-Year Treasury (DGS1) 3.92% -7 bp
- 10-Year Treasury (DGS10) 4.37% -9 bp
- 20+ Treasury ETF (TLT.N) +0.70% w/w
- Confidence (AAA10Y) 1.09% +5 bp
Bank credit increased this week just slightly – 2% annualized. If it continues, that’s bad news.
Ed Dowd thinks that
by irishprince 
