From Macro Man….

This market just gets more and more surreal. Yesterday saw the release of not one, not two, but three pieces of abjectly awful US economic data. So naturally, equities surged higher and government bonds tanked….because of more hopeful noises over the passage of the TARP.

The orders data was wretched on both a headline and core basis. The core shipments figures, which get plugged straight into the GDP calculation, were also awful, prompting at least a couple of immediate Q3 forecast downgrades.

Meanwhile, just when you thought that the housing data had lost its capacity to shock, the new homes sales figures dropped 11.5% month-on-month. The way things are going, they’ll soon be able to publish housing data by name, e.g. “This month Fred and Mavis Smithers bought 687 Walnut Lane in Pig’s Knuckle, Arkansas.” The one housing figure that Macro Man follows is the supply data; as the chart below illustrates, there is no real improvement in sight.