The economic grow is weak the United States with some areas improving better than others. The real estate market, as an example, has found a bottom at current levels, while the unemployment rate remains high and could increase in the future. Deleveraging is not over and small/medium size businesses are now under pressure. CIT group could not refund USD 1 billion in debt that will mature in August and the company should now accept USD 3 billion loans from bondholders to avoid bankruptcy. CIT¡¦s meltdown would have spread into the retail industry, since about 60% of the footwear and apparel products rely on the company. In effect, economic data remains inconsistent and fragmented. After having slumped 1.2% in May, industrial production declined only 0.4% in June (-0.7% expected). Nonetheless, capacity utilization printed 68.0%, which corresponds to the worst number in history. Retail sales rose 0.6% in June, versus May¡¦s gain of 0.5%, supported by the increase of 2.3% in auto sales. However, sales were up only 0.3% excluding motor vehicles.
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