Domestic Orders Down, Imports of Durable Goods Up?

This morning, the Census Bureau announced that

New orders for manufactured durable goods in March decreased $2.2 billion or 1.3 percent to $176.7 billion

But the press release neglects to point out that this number only includes domestic orders (see my post from earlier this week). That is, new orders for domestic manufacturing only. Orders for imported goods are excluded.

Companies may very well be ordering durable goods, but they are ordering them from overseas. That’s especially true in computers and electronics and automotive (we don’t have the March import numbers yet).

That means economists and journalists are misreporting this morning’s numbers. For example, an article on wsj.com said this morning

Orders for nondefense capital goods decreased by 7.5% last month. The orders are seen as a barometer of capital spending by businesses.

Are orders a barometer? There’s no way to tell.

About Michael Mandel 127 Articles

Michael Mandel was BusinessWeek's chief economist from 1989-2009, where he helped direct the magazine's coverage of the domestic and global economies.

Since joining BusinessWeek in 1989, he has received multiple awards for his work, including being honored as one of the 100 top U.S. business journalists of the 20th century for his coverage of the New Economy. In 2006 Mandel was named "Best Economic Journalist" by the World Leadership Forum.

Mandel is the author of several books, including Rational Exuberance, The Coming Internet Depression, and The High Risk Society.

Mandel holds a Ph.D. in economics from Harvard University.

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