Question-and-Answer Session
[Operator Instructions] Your first question comes from the line of David Begleiter of Deutsche Bank. Please proceed.
David Begleiter - Deutsche Bank Securities
Good morning.
James S. Sawyer - Executive Vice President and Chief Financial Officer
Hi, David.
David Begleiter - Deutsche Bank Securities
Hi Jim, the slow down in the base business you referenced, when did that begin and can you quantify the magnitude of that slow down?
James S. Sawyer - Executive Vice President and Chief Financial Officer
I am really talking very specifically about US manufacturing, okay? And that would be the leading indicators for that, really our TDI weekly sales, okay? And we measure the TDI weekly sales both in terms of gas sales also in terms of hard good sales, and then even within the hard good sector, we break it down between, what we call, capital hard good sales, which would be drill presses, and valving equipment, and laser cutting equipment, on the one hand, to consumable sales. So, as the cycle builds up, what you typically see is that the capital sales in the hard goods grow the fastest the first, and then along comes the gases and along comes the consumables. What we saw was that the growth in the capital goods orders really peaked about a year ago and the rate of growth has been slowing in that. So, that to me is the leading indicator and that started over a year ago. The sales of gases still continues to grow nicely, but not as fast as it was growing a year ago, and the same thing with hard goods. Now, let me just make one more point on that question, which I think makes it difficult in my mind for everybody to watch exactly what is going on in the economy, because we have not seen anything that looks or feels or smells like anything’s going off of a cliff, unlike what you hear a lot of people talking about. One thing that we do see change from season, just from year to year, is that December sales and volumes are always difficult to predict and are difficult to report in 20-20 hindsight because a lot of factories take a week off during the Christmas holidays and depending on when the holiday, when New Year lands, and when Christmas lands, they may drop off fewer or more days. What we found is that a lot of customers decided to take two week shut downs during the end of December and that reduced our volumes during those months, and I suspect that it also reduced things like the industrial production index for December and so on and so forth. But, I just like to reiterate that we are just seeing? it’s kind of gradual slowdown in heavy manufacturing for about a year, but we haven't seen any inflection point.
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