Until last week you hadn't heard much about the bond market rally. I told you we were probably near a rally way back in early April when the 10-year was yielding around 1.7%. And I told you in mid-April that the 10-year yield could fall all the way back to the 1.2 to 1.3% range. The bond rally since April [...]
I thought of Gilda Radner this past week. Actually, I thought of a character she created on the original Saturday Night Live, Emily Litella, who was a regular on the Weekend Update segment. She'd start to rant about something topical, getting it completely wrong at which point Jane Curtin or Chevy Chase would explain it to her and she'd respond. [...]
The FOMC’s “hawkish” dots for their June 2021 assessment weren’t an acknowledgement of recent inflation data in the US. That’s how many are characterizing the change, modest as it actually was. Inflation is about emotion in most places, especially when CPI’s and PCE Deflators, a healthy dose of producer prices, all seem to point to an overheating economy on the [...]
Same stuff, different month. We can basically reprint both what was described yesterday about supply curves not keeping up with exaggerated demand as well as the past two months of commentary on Retail Sales plus Industrial Production each for the US. Quite on the nose, US demand for goods, anyway, is eroding if still artificially very high. Producers, on the [...]
It makes all the difference in the world. Back in the back half of 2018, the word more often being used when compared to that year’s first half had been “slowing.” By the later months, it was pretty obvious this was taking place no matter how many times the American unemployment rate was dusted off and trotted out in front [...]
Why do economic data providers continue to overstate reflationary periods? This is more substantial than a pet peeve, though to many if not most it might seem like splitting hairs. We’ve seen this happen repeatedly with each eurodollar cycle. The more egregious economic overstatements were definitely 2014’s, the data errors contributing at least something to the confusion and narrative mistake, [...]
American consumers binged again in April, though not much more than they had in March. Previously delivered government stipends continue to inflate retail activity if not much else. According to the Census Bureau, retail sales rose “just” 0.7% last month when compared to the month before it. Given that March had been up (revised) nearly 11% versus February, any even [...]
Given the historic data for US retail sales, “somehow” the bond market ignored them yesterday (and today). Yields globally fell for the most part, with real yields (TIPS) really discounting the significance of consumers in March. Bonds aren’t buying that this is anything other than temporary.Not surprisingly, the mainstream media refuses not to buy what bonds aren’t. I mean, for [...]
Enormous. Terrific. Unbelievable. Biggest ever. The superlatives for US consumer spending during the month of March 2021 are appropriate, and for once they aren’t caused by some artifact of arithmetic or some other trick. While there are absolutely some base effects within the numbers, these levels of retail sales are far and away more than those. It's so ridiculous that [...]
While the global inflation picture remains fixed at firmly normal (as in, disinflationary), US retail sales by contrast have been highly abnormal. You’d think given that, the consumer price part of the economic equation would, well, equate eventually price-wise. Consumers are spending, prices should be heading upward at a noticeable rate. To begin with, consumer spending – as pictured by [...]
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