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ISM’s Report on Business (RoB) blisters upward, but…
My former residence within the real economy was right here, in the manufacturing base. I don’t miss it even one little bit, but were I still involved we’d be booming and bitching. Business would be very good and prices and supply constraints very aggravating. The way things went in my segment – Medical Equipment, often pressured by Medicare constraints and general competition – I’d be getting hit over the head by customers about maintaining low prices while facing immovable obstacles in the form of supplier prices and extended deliveries. Now I write for a living. It’s a no-brainer I guess.
That digression aside, let’s look at the RoB. Here is the headline. You can click the graphic to grab the entire report (pdf).
As the call rate lurched from 60% to 70% and, later, 100%, the metaphorical air supply of cash that normally enlivened the stock market was choked off. Equity prices started to sink badly, and by the afternoon of Thursday, October 24, Ransom Thomas, the president of the NYSE, went to Morgan’s office to advise him that they were going to close the stock exchange early. Morgan correctly asserted that such an act would only add to the panic and tumult, and he implored Thomas to give him time to help.
Here’s an interesting breakdown showing who it is that actually owns all those trillions in U.S. equities. Increasingly, it is foreign holders, which struck me as a surprise. Click on the image for easier readability.