It's a mountainous monetary problem. “Inflation is always and everywhere a monetary phenomenon.” -- Milton Friedman This is a real time case study. Color me skeptical about a "soft landing." At the very least , there's likely to be some bumps. Disclaimer: This information is presented for informational purposes only and does not constitute an offer to sell, or [...]
"After a pause in September, the LEI resumed signaling recession in October." LEI signaling a shallow recession. The index is down 3.3% in the last 3 months and -.8% in October. I hate to compare cycles, but the machine does and there are certainly similarities. The similarities became apparent with the release of CPI last week. In June of 2006 [...]
Stocks, REITs, and bonds all rallied last week on the back of what was interpreted as good news on inflation. The CPI report was better than expected, the overall level flat from September to October. Core inflation, less food and energy, was also better than expected at up 0.2%. Producer prices, reported the day after CPI were even better, coming [...]
Retail sales make up about a quarter of GDP, so an important monthly number. I saw a lot of headlines saying this was a disappointing number. But that isn't the case, the print was actually good. Sequentially, expectations were low for this print because September 2023 and October of 2022 were so strong. The sequential number was expected at -.3% [...]
If we look at inflation on a year over year basis, the data series is smooth and it is coming down. The rate of decent has slowed, but that's ok, the world doesn't work in perfectly smooth arcs and waves. The month over month annualized rate is a shorter term (very volatile) rate. As such, it will lead when there [...]
Measures of inflation GDP price deflator: 3.24% Personal Consumption Expenditure (PCE) Price Index YoY: 3.43% Core PCE (ex-Food and Energy): 3.9% All well above 2% target. All have been coming down. Disclaimer: This information is presented for informational purposes only and does not constitute an offer to sell, or the solicitation of an offer to buy any investment products. None [...]
Here is a brief summary of what is of concern to domestic and international policymakers, academics, community groups, and others. We might call these "known risks." Persistent inflation and monetary tightening Persistent or reaccelerating inflationary pressures Resilient economic outlook leading to further monetary policy tightening Volatile market conditions Entrenched expectations of higher inflation leading to higher realized inflation leading to [...]
Well, I finally got it. I've been fighting COVID for the last week and while most of my symptoms have improved, I am not 100% yet. My goal from the beginning of COVID was to avoid it, if at all possible, until it became endemic and less lethal. It seemed logical to me, a layman, that it would follow this [...]
I said a couple of years ago that I thought that once all the distortions were past, we'd be back to where we started prior to COVID, but with more debt. The decade from 2010 to 2020 was the slowest decade of nominal GDP growth since WWII and the prospect of another decade of that wasn't all that appealing but [...]
The most anticipated release of the week came in ... "Unchanged" or sticky stuck from August at 3.7% yoy. But it's worth mentioning as we will discuss below that this is up from June CPI which was 3.09% yoy. Core CPI which excludes food and energy because of their volatility sits at 4.13% yoy down from 4.39% last month. Let's [...]
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