The latest reading of the Empire State Manufacturing Survey was a big disappointment. The headline number unexpectedly fell to -8.1 from -5.22 a month ago. Economists were looking for an improvement to -1.0. Most major regional manufacturing indicies as well as the ISM manufacturing index are pointing to contraction thanks to a combination of Hurricane Sandy and uncertainty related to the fiscal cliff. On the fiscal cliff, talks continue to go nowhere. However, it appears that President Obama may have blinked on entitlements (e.g. Social Security).