Why Good News is Bad News for Markets

Nearly all the equity market gains from the two-day rally on Monday and Tuesday were wiped out by Friday. The table shows the peak value of the indexes at the turn of the year, the index lows (three of the four indexes had new lows on September 30), the percentage change from the peak, and […]

Headline Data Say the Economy is Solid

Markets Know Better Market reaction and direction were always going to be about the employment numbers. At first glance, the +315K from the BLS’ Payroll Survey looked “solid,” and equities rose more than 1% in Friday’s early going. But, as further analysis occurred, markets ended the day significantly in negative territory. Apparently, the details below […]

As The Recession Asserts Itself, The Fed Takes a Hard Line

Sinks Stocks Equity markets were in a holding pattern all week waiting for some tidbits from the Federal Reserve’s (Fed) annual Jackson Hole Symposium; especially waiting for Chair Powell’s Friday eloquence. Through Thursday, only the DJIA was off more than -1%, the Russell 2000 was almost flat, while the S&P 500 and Nasdaq were down […]

Less Hawkish Fed – Don’t Celebrate!

 They’re Still Tightening into a Recession Most of the economic news this week was downbeat. Even the normally buoyant U.S. consumer appears to be retrenching as July’s Retail Sales were flat (0.0% M/M). Both equity and bond prices ended the week somewhat lower with the DJIA barely moving, but the tech heavy Nasdaq and small […]

Fed to Markets: “Curb Your Enthusiasm”

Despite Contrary Evidence, Fed Worries About CPI “Head Fake” Larry David is most famous for his role in the creation and production of the Seinfeld comedy series. After Seinfeld, David went on to create and star in another such series called Curb Your Enthusiasm. We thought the title of that series is exactly appropriate for […]

Pols and Bureaucrats Insist There Is “No Recession”

THAT DOESN’T CHANGE REALITY! The Fed raised the Federal Funds interest rate (the rate banks pay for reserves) on Wednesday by 75 basis points (bps) (0.75 pct. points) from 1.50% to 2.25%, and on Thursday, the BEA reported real Q2 GDP fell -0.9%.  That’s the second quarter in a row of negative real GDP growth; […]