Blind Optimism Leads To Malinvestment, Oil Glut, Collapsing Rig Counts

A recent report by Wood Mackenzie notes that cheap oil has barely made a dent in the global production of crude. Even though the price of oil has fallen like a rock, global oil production has barely budged. The problem of course is that many of the projects coming online were large projects with loads of sunk costs. And like … Read More

Plunging Oil Prices Showing Up In Houston Texas Housing Data

With the summer’s positive sales numbers it would be easy to say that Houston’s housing market is perfectly healthy with little cause for concern. That would be a mistake, one likely to be made by many local Realtors and economists alike. The truth of the matter is that the commodities crush we’ve seen during the last 12 months is already showing … Read More

Oil Takes Out $41, Home Builders Walking Into A Trap Of Their Own Making

I was out home shopping with a client this past week, and something that was readily apparent is the dramatic shift in the new home market here in Katy, West Houston during the past year. As I have written in previous posts, home builders have been suffering from a serious bout of irrational exuberance. I’m of course referring to the … Read More

ExxonMobil Earnings, Revenue Plunge In Second Quarter As Production Rises

It looks like the much-ballyhooed recovery has a few kinks left to work out. Today we learned that the employment cost index (ECI) showed continued weakness in wage growth in the U.S. The quarterly increase in wages printed at just 0.2%, well shy of the 0.6% expected. This was also the smallest quarterly gain in the history of the series … Read More

August Crude Oil Drops 7.7 Percent To Settle At $52.53 Per Barrel

The contagion from the Greek referendum ‘No’ vote and the Shanghai shenanigans was mostly contained today in terms of U.S. equities, but the oil market was less than amused. August crude oil settled at $52.53 per barrel today, a fall of 7.7 percent. I think the Greater Houston Partnership may need to revise their already halved employment projections again pretty … Read More

Dallas Fed: Texas Manufacturing Activity Still Contracting In June

Texas Manufacturing Activity

Today the Dallas Fed reported that Texas manufacturing activity continues to contract. The Texas Manufacturing Outlook Survey for June was a continuation of previous reports this year noting a declining manufacturing sector in the Lone Star state. The production index posted at a negative 6.5, a fourth consecutive month of declining output in Texas. While the pace of decline has … Read More

Dallas Fed – Texas Manufacturing Activity Continues To Weaken

The March readings for manufacturing activity in Texas showed continued weakness in the Lone Star State. Readings from the March report show that the Texas production index posted at -5.2, the first negative reading in two years. Other measures of manufacturing activity were negative in March as well. The general business activity index declined 6 points to -17.4. The hours … Read More