The Fed: “We Don’t Talk About Rate Cuts – No! No! No!”
The title of this blog was inspired by Disney’s Encanto, a story about a family living in a charmed villa in the mountains of Columbia. Cracks begin to appear in the foundation of the grand villa, and it is Bruno, an ostracized family member, who holds the key to stop the foundation from crumbling. The […]
As Inflation Fades and Incoming Data Disappoint The Fed Appears Intransigent
The headline CPI reading of no price inflation (0.0%) in October surprised the financial markets (but not us). It caused a bond market rally as yields (especially on the long end) fell. Then the PPI (Producer Price Index) showed up with a negative number for October (-0.5%), and this is generally a harbinger of what […]
The Fed is Done Hiking – What Could Possibly Go Wrong?
Sometimes “bad news” is “good news.” That seemed to be the case on Friday when the jobs report came in weaker than expected. That, combined with the Fed’s continuing rate “pause” on Wednesday ignited the financial markets – both equities and bonds. Among the popular averages, the DJIA gained 5.1% on the week, the S&P […]
GDP Growth Will Slow – Likely to Turn Negative
The economic story of the week was the “hot” 4.9% GDP print. The chart shows this in relationship to the recent past, with the dotted line showing the long-run 1.8% growth rate of the economy. The 4.9% is an annualized number, so the actual growth from Q2 was just under 1.5%, and the year/tear growth […]
Data Not Conducive to Wall Street’s “Soft-Landing” Scenario
One of the two major economic/market events that occurred last week (week of August 20) was the stellar performance of Nvidia (NVDA) which, unlike the retailers, beat on both top and bottom lines and whose stock price has soared from a 112 low last October to a high print of nearly 503 early on Friday […]
As Signs of Recession Mount, the Fed Reiterates its Hawkish Path (Even Volcker Relented as the Recession Approached!)
The chart shows the continued downtrend in same store sales and, while the Seasonally Adjusted (SA) rise in April’s Retail Sales of +0.4% over the March number was cheered by the financial media, the Not Seasonally Adjusted (NSA) data showed a -2.4% fall vs. March and was the worst showing for any April in the […]