By Walter Kurtz, Sober Look
The US government’s dysfunction that created tremendous uncertainty recently is now filtering through the economy. The impact on manufacturing is already visible, as the output of US factories takes a dive in October.
Chris Williamson (Chief Economist)/Markit: – The flash PMI provides the first insight into how business fared against the backdrop of the government shutdown in October, and suggests that the disruptions and uncertainty caused by the crisis hit companies hard. The survey showed the first fall in manufacturing output since the height of the global financial crisis back in September 2009.
Aside from the numbers, this means loss of well-paying manufacturing jobs and further economic weakness. Congratulations go to the elected officials in Washington who helped create this mess.
Just to put this into perspective, here is the equivalent indicator for the Eurozone – a group of nations that has been struggling with recession until quite recently. Note that a measure above 50 indicates growth in output, showing that the Eurozone manufacturing output growth is now stronger than it is in the US.