Economy Runs Hot While Fed Fiddles

Retail sales for October came in hot at 1.7% MoM vs 1.4% expected. Excluding gas and motor vehicles, sales gained 1.4%. These are the highest prints since March’s blowout data and represented strong results across the board. Strong Walmart and Home Depot results underscored the print.Note that retail sales are adjusted for seasonal factors, but … continue reading →

The Japanification of the US Markets

If you blinked, you might have missed the S&P 500’s 1.1% plunge last Wednesday… …following the highest CPI print since 1990.The print was followed two days later by the lowest consumer sentiment reading in 10 years, a result driven primarily by…wait for it…inflation fears.  Stocks actually rose on the day.Until a few months ago, the … continue reading →

DXY: Finally Breaking Out?

Stocks tumbled yesterday on inflation numbers that call into question the pace of the Fed’s taper and rate increases. Then they rallied overnight on an 11.4% collapse in VIX. The most significant chart on my screens at the moment, though, is the US dollar. DXY has had great difficulty breaking out of a tightly controlled … continue reading →

CPI: Out of Control

CPI soared to 6.24% YoY in October, well above the 5.9% expected and the highest since Nov 1990. The MoM print of 0.9% and the Core CPI print of 4.2% also came in hotter than expected and set multiyear records. Put simply, the Fed has lost control.As we’ve discussed, inflation continues to become more broad-based … continue reading →

PPI Soars, CPI on Deck

Producer Prices for Final Demand in October jumped 0.6% MoM and 8.6% YoY (6.2% less food, energy and trade.)Futures were little changed… …though the 10Y slipped to a cycle low of 1.43%. continued for members… … continue reading →

Out of Sync

SPX tagged a significant Fibonacci extension Friday, but ES came up short of its equivalent target at 4728. Meanwhile, CL is faltering and USDJPY is rolling over as VIX faces a bullish 10/20 cross. What does it all mean? Surprisingly, the answer might lie with the bond market. continued for members… … continue reading →

Charts I’m Watching: Nov 5, 2021

The 531K payrolls beat and Pfizer COVID-19 pill could influence the taper schedule. The 4.9% increase in wages should. Energy and food prices might well fall over the coming months. But, wages are sticky. Whether due to contracts, minimum wage rules, or just market forces, they are very difficult to reduce. While it’s true that … continue reading →