The catalog of wishful thinking technically classified as reports on the economy emanating from the Associated Press, aka the Administration's Press, grows with virtually each passing business day.
One of yesterday's additions to the mountainous pile came from the AP's Christopher Rugaber. Tasked with covering the Federal Reserve's report on October's industrial production, he devoted 10 of his 11 paragraphs in his dispatch to manufacturing. He didn't even tell readers that the Fed's release was about anything besides manufacturing until his ninth paragraph. The AP's headline writers also cooperated by only mentioning manufacturing. In an utterly amazing "coincidence" (no, not really), manufacturing is the only one of the Fed report's three major industry groups which turned in a positive performance:
The fact that manufacturing makes up about two-thirds of all industrial production hardly justifies pretending that the other industry groups don't even exist for eight of 11 paragraphs. The declines in the other two categories, mining and utilities, as seen above, were far from minor.
Here are the first three of those 11 paragraphs:
US MANUFACTURING OUTPUT RISES FOR FIRST TIME IN 3 MONTHS
U.S. manufacturing output rose in October for the first time in three months as factories cranked out more steel, cars and computers.
Manufacturing production increased 0.4 percent last month, the Federal Reserve said Tuesday, after slipping 0.1 percent in September.
The rise suggests that manufacturers may be overcoming several headwinds they have faced for most of this year. Many retailers and wholesalers have been cutting back on their stockpiles after ordering too many goods this winter. That has weighed on output. And the strong dollar has cut into exports by making U.S. goods more expensive overseas.
Rugaber's reference to "cutting back stockpiles" is not supported by the facts. Inventory-to-sales and inventory-to-shipments ratios remain very high, and, as seen here and here, have been climbing for several years. This suggests that a huge inventory glut relative to sales and shipments still exists.
Here are Rugaber's final three paragraphs, wherein he finally mentioned the other industry groups in the Fed's report, before circling back to manufacturing:
Overall industrial production, which includes mining and utility output, fell 0.2 percent, after dropping by the same amount in September. Mining production fell 1.5 percent, dragged down by cutbacks in oil and gas drilling. Utility output plummeted 2.5 percent, largely because of warmer-than-usual weather.
Other data has also suggested factories may be picking up a bit. The Institute for Supply Management, a trade group of purchasing managers, said earlier this month that its measure of production in October rose for the first time since July.
And a gauge of new orders received by U.S. manufacturers rose strongly, the ISM said. That suggests output may rise in the coming months.
Rugaber, by almost ignoring all elements of the Fed's industrial production report except manufacturing, also managed to "forget" to tell readers that overall industrial production has declined or remained static in eight of the past ten months.
Finally, the AP economics writer failed to relay the Fed report's most troubling stat of all (in the blue box above): Total industrial production in October was barely higher than it was a full year ago. Zero Hedge helpfully noted yesterday that this +0.3-percent year-over-year result was "the weakest growth since January 2010."
Rugaber, by virtually hiding the declines, ensured that most people will have no idea how weak the situation has been, and continues to be.
Cross-posted at BizzyBlog.com.
