A Strapped Consumer = A Slowing Economy

Rampant CRE Foreclosures Portend Something More Sinister Financial markets closed the week mixed with the Nasdaq rising +1.4% and closing at a record high thanks to the huge Nvidia beat on both top and bottom lines. The S&P 500 was flat on the week (+0.3%) while the Dow Jones, with its 606-point (-1.5%) dive on […]

When “Bad News” Becomes “Good News”

While Tuesday’s Producer Price Index (PPI) for April came in hotter than expected (+0.5%), markets took the bad data in stride, perhaps because the year/year change on the headline index was still only 2.2% (2.4% for the “core,” i.e., ex-food and energy). Another reason for the lack of market volatility from the release may have […]

“Higher for Longer” Rates Have Risks – Especially for Banks

As expected, at its recently concluded March meeting, the Fed stood pat on interest rates. Of greater interest, the “dot-plot,” a picture of FOMC thinking about rates over the next two years, stayed at three cuts for 2024. Looking at the chart (the 2024 column), the median dot is 4.625%. That is a 75 basis […]

Despite Deteriorating Economics, Equity Markets at All-Time Highs

There were several important news events this week including the Fed’s January minutes. But this took a back seat to Nvidia’s blowout top and bottom-line numbers and its forward guidance which occurred after Wednesday’s (February 21st) market close. The equity market, which had been relatively flat on Tuesday and Wednesday, advanced more than 2% on […]

Headline Data Look “Strong,” But Contradictions Abound

The January Non-Farm Payroll (NFP) number was always destined to be a market mover, especially after Fed Chair Powell said that, while the Fed will be lowering rates in 2024, March was not their base case. The +353K NFP number (consensus was +185K) with December’s number revised up to 333K from 216K, and the +0.6% […]