Sep. 2, 2010 (United Press International) -- These days, mixed economic news is as good as it gets and the U.S. economy seems balanced, which is to say teetering -- on a cycle of quick ups and downs.
Unexpectedly, the Institute of Supply Management said Wednesday that manufacturing expanded in August with the headline index climbing from 55.5 to 56.3. New orders were down slightly, but production increased, as did employment, which has grown for nine consecutive months.
Automatic Data Processing Inc. countered that with its monthly private-sector job report. It said jobs, not including government jobs, were down by a net of 10,000 in August on the loss of 40,000 goods-producing jobs and the addition of 30,000 service-oriented positions. On Friday, the government is expected to announce the unemployment rate rose to 9.6 percent last month, up from the current 9.5 percent.
Auto sales were also down in August, on average 21 percent compared to August 2009, when the government was spending a portion of a $3 billion "cash for clunker" allocation, which eventually helped spur the sales of about 677,000 new cars.
On the positive side, layoff announcements dropped to the lowest level in 10 years to 34,768, another one of several employment figures that put the recovery ahead of the recovery from the 2001 recession. On the negative side, construction spending dropped in July to its lowest level in 10 years, a figure that might be expected given the recent drop in home sales.
The best news Wednesday might have been that August is over.
The Dow Jones industrial average added 2.5 percent, making up a sizable share of the 4.3 percent August decline. The Standard & Poor's 500 index gained 2.9 percent, as did the tech-dominated Nasdaq index.
From a longer view, the DJIA is off 1.5 percent for the year, prompting Steve Blitz, a senior researcher at Majestic Research, to put one day or even one month into perspective.
"Over any 10-game period, (a baseball) team can look like world-beaters or cellar dwellers, but in the end it evens out to an equal number of wins and losses," Blitz told The Washington Post.
In Washington, Christina Romer, outgoing chairwoman of the White House Council of Economic Advisers, said the stimulus dollars pumped into the economy helped avert a "second Great Depression."
Also in Washington, Richard Fuld Jr., the last chief executive officer at Lehman Bros., told the Financial Crisis Inquiry Commission "Lehman was forced into bankruptcy not because it neglected to act responsibly or seek solutions to the crisis, but because of a decision, based on flawed information, not to provide Lehman with the support given to each of its competitors and other nonfinancial firms in the ensuing days."
Essentially, Fuld was trying to spin Lehman's demise on -- in a comparison to lung cancer -- the last cigarette it smoked, rather than the thousands that went before it. Commission Chairman Phil Angelides reminded him that wasn't the point.
"The real question before us is: How did we end up with only two choices -- either bail out the banks or watch our world sink?" he said.
In international markets Thursday, the Nikkei 225 index in Japan rose 1.52 percent and the Shanghai composite index in China added 1.25 percent. The Hang Seng index in Hong Kong gained 1.19 percent and the Sensex in India rose 0.18 percent.
In Australia, the S&P/ASX 200 index gained 0.82 percent.
In midday trading in Europe, the FTSE 100 index rose marginally, up 0.04 percent while the DAX 30 in Germany lost 0.21 percent. The CAC 40 in France rose 0.39 percent, while the DJ Stoxx 50, a pan-European blue-chip index, fell 0.31 percent.
