First, my brother and his wife (the ones who lost the twins in 2010) had a baby boy this morning. It turned into a last minute emergency in the middle of a normal birth, but hopefully the baby is okay. His lung action is okay, anyway. Apparently he is voicing his philosophical displeasure over the human condition with abandon.

My sis-in-law is probably going to be in for a prolonged recuperation, because the emergency was acute and I gather they pretty much yanked out the knives and dove in to save the kid. This why it is really not a good thing to use those birthing centers. Almost always it is a much better experience, but if there ever is a real problem, you want to be in there right with the knives and knife-wielders; you don't have fifteen minutes, or ten minutes, or even five minutes. 

Chicago PMI - we may be in the last few months. This report is problematic; autos are still holding up but there was a wicked drop in lead times. Prices are still rising. Business barometer sharply lower at 56.2 from 62.2 in March. Overall a significant slowing, but new orders and inventories are still quite decent.This is a wait-and-see type deal.

The Dallas survey was quite disappointing this month.

On the consumer side, prices are rising for most items too rapidly. Personal Incomes and Outlays for March shows real disposable income growing, after two months of declines. But April prices in stores are reflecting a desperation relating to margins that is going to blow up this trend quite rapidly. Real PCE increased 0.1 in March compared to 0.5 in February. The report isolates most of the trend to new cars, but I think tax refunds boosted spending earlier.

This is basically a reprise of 2008, but without the impressive fall-off in credit-related spending to add drag. However the European drag on spending is introducing another leg down, China is pretty darned ugly, and the consumer-side inflation is explosive, without the margin companies had to cut costs back in 2007 and 2008. Then they were running fat and could cut. Now they can only raise prices, which is going to set off pure ugliness on the consumer side.

I spent the last few weeks walking around in stores, watching the prices of staples like pasta, beans and eggs rise. It's true that the US is the big global bright spot, but the bulk of US consumers must feel like they are walking around in a rainstorm.