Yesterday, I wrote about the grim news from China. Today, there was grim news closer to home. The Institute for Supply Management released its report for June. The PMI was at 49.7% which is a sign that the manufacturing portion of the economy is contracting. Any number below 50% means a contraction. While 49.7 is just under 50, it is also the first contraction in manufacturing since the end of the recession in 2009. It is bad news. Even worse, the new orders index was at 47.8%, down from 60.1% in May. Since new orders are the leading indicator for manufacturing activity in the months to come, having the index well below 50% is a sign that things are getting still worse.
It would be nice to think that president Obama would take time out from campaigning to try to get the economy back on course, but it seems no more than a fantasy to expect it to happen. If the employment report on Friday is as bad as these numbers indicate it may be, Obama will not have much luck at campaigning either.
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