Gross Domestic Product (GDP) was revised upward from a seasonally-adjusted annual growth rate of 2.945% to 3.243%. For the first time since the middle of 2014, GDP appears to have advanced (subject to further revisions) at a better than 3% rate for two consecutive quarters. That level of growth used to be commonplace, even something of an economic floor, but [...]
On Thursday, the Bureau of Economic Analysis (BEA) will report on Personal Consumption and Personal Income (as well as the difference between those two, the Personal Savings Rate). Accompanying the economic figures will be the usual estimates for consumer prices, in this case the Federal Reserve’s preferred inflation gauge the PCE Deflator. There isn’t expected to be much good news [...]
There is no change to the risk budget this month. For the moderate risk investor the allocation to bonds is 50%, risk assets 45% and cash 5%. The extreme overbought condition of the US stock market did not correct since the last update and so I will continue to hold a modest amount of cash. Prediction is very difficult, especially [...]
As expected, Cyber Monday hit records all across the retail industry. According to Adobe Insights, sales recorded by online outlets, including those of traditional brick and mortar stores, hit $6.59 billion. That’s a record not just for a Cyber Monday but any single day in the internet’s two decades of mainstream usage. It was, Adobe said, a gain of 16.8% [...]
New home sales rose sharply again for the second consecutive month. After rising more than 18% in the month of September 2017 over August (subsequently revised down to 14%), sales rose another 6% month-over-month in October. At a seasonally-adjusted annual rate of 685k, that’s the highest pace for any month going back exactly ten years to October 2007, a highly [...]
It is a common misperception that the Fed has in the past raised rates pushing the US economy into recession. The last time that was true was in 1979, when the Fed raised its Discount rate from 9.5% starting in June of that year to 13.0% the following March - right in the middle of the 1980 recession. It was [...]
Black Friday was once the king of all shopping. A retailer could make its year up on that one day, often by gimmicking its way to insane single-day volume. Those days, however, are certainly over. Though the day after Thanksgiving still means a great deal, as the annual flood of viral consumer brawl videos demonstrate, it’s just not what it [...]
Durable goods were boosted for a second month by the after-effects of Harvey and Irma. New orders excluding those from transportation industries rose 8.5% year-over-year in October 2017, a slight acceleration from the 6.5% average of the four previous months. Shipments of durable goods (ex transportation) also rose by 8% last month. Even with that slight quickening, these are not [...]
The economic data of the last two weeks was generally better than expected, the Citigroup Economic Surprise index near the highs of the year. Still, as I've warned repeatedly over the last few years, better than expected should not be confused with good. We go through mini-cycles all the time, the economy ebbing and flowing through the course of a [...]
First Bernanke, now Yellen. As I wrote earlier today, there is a growing tendency to revise economic history at least as it applies to official actions. Ben Bernanke defends QE from the perspective of 2009 forward, as if 2008 was all just someone else’s problem irrelevant to the world that came after. In effectively resigning from the Fed Chair position [...]
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