US economy not likely to see significant acceleration

Durable goods orders in the US were down in October.

Durable Goods Orders Slip Unexpectedly
Orders for long-lasting U.S.-made goods unexpectedly slipped 0.4 percent last month as demand for computers, cars and civilian aircraft slumped, a government report showed on Wednesday. The Commerce Department said orders for durable goods -- big-ticket items like cars and refrigerators meant to last at least three years -- would have been much weaker in October were it not for strong military demand. Non-defense durable goods orders dropped 1.5 percent, the sixth decline in the last seven months, and orders excluding transportation fell 0.7 percent, the department said.

Economists polled by Reuters had expected durable goods orders to rise by 0.5 percent, with non-transportation orders up 0.2 percent and orders excluding defense up 0.3 percent. While the report was weaker than expected, upward revisions to September's figure helped temper the picture. Durable goods orders in September were up 0.9 percent, compared to the 0.2 percent gain reported previously.

The federal depreciation bonus that expires at the end of the year and that had been expected to boost business spending does not seem to be having the expected kick. Hopefully, US consumers will pick up the slack.

UMich Finds Consumer Sentiment Up a Bit
U.S. consumer sentiment brightened slightly in November, helped by cheaper gasoline and a better jobs outlook, a survey released on Wednesday showed. The University of Michigan's final reading of its consumer confidence index for November was 92.8, up from a final October reading of 91.7...

Whether they actually have enough cash to spend, however, is another question.

ACNielsen Finds U.S. Consumers Short on Cash As Important Holiday Selling Period Begins
Many U.S. consumers say they are strapped for cash this holiday season, a development that could point to a moderate holiday selling period, according to a new study from ACNielsen, a leading provider of consumer and marketplace information. In fact, of the 28 markets around the world surveyed by ACNielsen, the U.S. had the highest percentage of consumers (28%) who say they have no extra money to spend. Among U.S. consumers who do have spare cash, their first priority for that money is debt repayment...

The upshot of all these pieces of news is that I am leaning further toward the idea that the US economy is more likely to decelerate than see a significant acceleration going forward.