Chi-Town PMI

Goldman's own Dave Kostin said the economy has turned for the worse, probably annoying Goldman's trading desk as they issued a long Russell 2000 note, which simply means they are selling the R2k to their clients.

Chicago PMI thus far is validating Kostin, while the R2k is down a half a percent since the GS long call.

Released on 1/31/2012 9:45:00 AM For Jan, 2012

Prior Consensus Consensus Range Actual Business Barometer Index - Level 62.5  63.0  59.0  to 65.5  60.2

The expectation was for Chicago PMI to beat the previous print of 62.5  with consensus at 63, it came in below both at 60.2.

The particulars show the employment component falling, the order backlog falling in to contraction (which isn't good news when everyone just restocked -remember Q4 GDP had it's biggest gain in restocking and now the orders have dried up, which doesn't bode well for Q1 GDP at all), new orders also fell, production fell (not good for employment).

From the comments section of the report, a decline in defense spending by the Federal government was hurting one respondent, another said that their orders were "uncharacteristically slow". Another said the "Talk indicates a busy quarter, but there seems to be some hesitation in getting orders out".

The devil is always in the details.