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Here’s David Rosenberg raining on the bullish economic parade:

“We realize that the widespread consensus is one of economic acceleration in the US.  To be sure, the data on retail sales, employment and housing have supported that view.  Unfortunately, weather impacts have massively distorted the early year data, with both January-February temperatures coming in five degrees above normal (exactly a two and a half standard deviation event).

Meanwhile, we know that the European recession is ongoing and the slowdown in Asia is intensifying – and there are other more arcane economic statistics suggesting that the overall pace of industrial activity is slowing much more than is evident to the naked eye.

The growth in machine tool orders – a highly cyclical barometer – has plunged to its weakest trend since December 2009, before the era of “green shoots”.  The transportation services index in January fell 2.5% on a sequential basis, which actually only typically happens in a recessionary phase and the YoY trend has visibly peaked and rolled over.  Truck tonnage also collapsed 4% MoM in the latest month, which last happened at the depth of the great recession in March 2009.”

Source: Gluskin Sheff

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