Manufacturers' Shipments, New Orders and Inventories (M3) for July 2009 numbers are out and New orders for durable goods increased 4.9%.

New orders for manufactured durable goods in July increased $7.8 billion or 4.9 percent to $168.4 billion, the U.S. Census Bureau announced today. This was the third increase in the last four months and the largest percent increase since July 2007. This followed a 1.3 percent June decrease. Excluding transportation, new orders increased 0.8 percent. Excluding defense, new orders increased 4.3 percent.

Yeah, Yippee, rah, recovery here we come. Oops, not so fast.

Firstly, the above initial press release only gives aggregate data points.

Guess what, you need to pull down the full M3 data release to dig out the real story. Buried deep in the tables are new orders minus defense and minus aircraft, ya know where U.S. businesses live. There new orders are down, -0.3%.

Another point is all of the Durable goods data is seasonally adjusted. Since we had some anomalies in seasonally adjusted unemployment data, it sure would be nice to know what those adjustments and assumptions are...in raw numbers.

So highlighting the fine print here is what Capital Goods defines:

The Capital Goods Industries include Nondefense : small arms and ordnance; farm machinery and equipment; construction machinery; mining, oil, and gas field machinery; industrial machinery; vending,laundry, and other machinery; photographic equipment; metalworking machinery; turbines and generators; other power transmission equipment; pumps and compressors; material handling equipment; all other machinery; electronic computers; computer storage devices; other computer peripheral equipment; communications equipment; search and navigation equipment; electromedical, measuring, and control instruments; electrical equipment; other electrical equipment, appliances, and components; heavy duty trucks; aircraft; railroad rolling stock; ships and boats; office and institutional furniture; and medical equipment and supplies.

Defense Capital Goods include : small arms and ordnance, communications equipment, aircraft; missiles, space vehicles, and parts, ships and boats, and search and navigation equipment.

Since Defense Capital goods new orders shot up 14.8%, it appears we are really busy making guns and military weapons.

So, what does that mean? American Businesses aren't buying anything, they are not investing, they are not planning on making things.

New orders after transportation weren't so hot either, a 0.8% increase. Machinery new orders is way down, -6.6% .

Also, not so hot are unfilled orders.

Unfilled orders for manufactured durable goods in July, down ten consecutive months, decreased $0.4 billion or 0.1 percent to $740.2 billion. This was the longest streak of consecutive monthly decreases since the series was first published on a NAICS basis in 1992 and followed a 0.8 percent June decrease.

Basically as soon as an order comes in, they are filling it.

So, while it's great to see this huge boost in overall Durable goods new orders, the fine print paints a different picture.