The manufacturing index dropped in December 2018, but Forbes still argues that the industry is stronger than you think. They said, "Manufacturing activity keeps expanding, albeit at a slower pace. And innovations in manufacturing technologies have just started to boost the efficiency and competitiveness of U.S. manufacturers - which might help explain the stabilization in export orders in a weaker global growth environment." There were a few drops last year that rebounded just fine. Don't write off manufacturing just yet, there is still a lot of growth left!
The December drop in the ISM (Institute for Supply Management) Manufacturing Index seemed to bring the bad news that many feared and yet wanted to see—like a scary scene in a horror movie. The one-month fall was eye-catching: 5 percentage points, the sharpest since the end of 2008. It lined up well with concerns over weakening global growth and subpar stock market performance. It bolstered fears that the trade war with China has started to take a toll on U.S. economic activity. And it provided fuel to the argument that the Fed should stop hiking interest rates. Economists in investment banks and research institutes will be busy updating their recession probability models. Read More