The Morning Call---Beware wishful thinking

 

The Morning Call

 

7/15/22

 

 

The Market

         

    Technical

 

            Thursday in the charts.

            https://www.zerohedge.com/markets/banks-dump-bitcoin-pumps-bullion-slumps-inflation-recession-battle-builds

 

Note: yesterday the S&P unsuccessfully challenged the lower boundary of its intermediate term uptrend for the third in the last month.

 

            The Treasury curve is the most inverted since 2000.

            https://www.ft.com/content/4f4c3414-9249-4347-91e1-6049081ec431

 

            Don’t fight the rising dollar.

            https://www.bloomberg.com/news/articles/2022-07-14/-don-t-fight-it-hedge-funds-wall-street-double-down-on-dollar?srnd=premium#xj4y7vzkg&sref=loFkkPMQ

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

June retail sales rose 1.0% versus expectations of +0.8%; ex autos, they were up 0.7% versus 0.0%.

 

The July NY Fed manufacturing index was reported at 11.1 versus estimates of -2.0.

 

                        International

 

The May EU trade balance was E-26.3 billion versus predictions of E-31.7 billion.

 

Q2 Chinese GDP growth was -2.6% versus consensus of -1.5%; June YoY industrial production was up 3.9% versus +4.1%; June YoY retail sales were up 3.1% versus 0.0%.

 

                        Other

 

                          Looming rail strike could further exacerbate supply chain problems.

                          https://legalinsurrection.com/2022/07/looming-rail-labor-strike-to-further-stress-americas-reeling-supply-chain/

 

                          Update on US average earned income.

                          https://politicalcalculations.blogspot.com/2022/07/average-earned-personal-income-in-21st.html#.YtBMO3bMKUk

 

                          Jamie’s hurricane (to date).

                          https://www.yardeniquicktakes.com/jamies-hurricane/

 

                          Spending up, savings down.

                          https://www.zerohedge.com/markets/recession-imminent-spending-fueled-debt-savings-run-dry

 

            The Fed

 

              BofA on QT (ending early).

              https://www.zerohedge.com/markets/iconic-fed-analyst-calls-it-powell-will-be-forced-end-qt-much-sooner-expected

 

             Money creation slows down.

             https://www.zerohedge.com/economics/slowdown-money-creation-could-be-another-recession-signal

 

              Mohamed El Erian on Fed policy.

              https://www.zerohedge.com/political/3rd-wave-inflation-will-be-unleashed-if-fed-doesnt-get-its-act-together-el-erian

 

            Recession

 

              Beware wishful thinking.

              https://www.wsj.com/articles/beware-wishful-thinking-about-inflation-and-recession-11657719575

 

              Freight shipments declined in June.

              https://www.zerohedge.com/markets/june-shipments-decline-latest-cass-data-shows-volumes-weaken-costs-hit-new-high

 

            Inflation

 

              Did June CPI mark the peak in inflation?

              https://www.morningstar.com/articles/1102067/did-the-june-cpi-report-mark-peak-inflation

             

              In support of that thesis:

              http://scottgrannis.blogspot.com/2022/07/why-todays-cpi-release-was-not-shock.html

 

              On the other hand.

              https://www.capitalspectator.com/peak-inflation-watch-14-july-2022/

 

              And the counterpoint.

              https://www.pragcap.com/the-risk-of-deflation-is-now-greater-than-the-risk-of-prolonged-high-inflation/

 

            China

 

              A growing number of Chinese have stopped paying their mortgage.

              https://www.zerohedge.com/economics/damage-could-be-huge-chinese-banks-tumble-swept-mortgage-nonpayment-scandal-borrowers

 

            The coronavirus

 

              The US health agencies are not following the science.

              https://www.commonsense.news/p/us-public-health-agencies-arent-following?s=r&utm_campaign=post&utm_medium=web

 

     Bottom line.

           

            When to sell.

            https://humbledollar.com/2022/07/when-to-sell/

 

            Investors seem too comfortable (must read).

            https://www.advisorperspectives.com/commentaries/2022/07/14/investors-still-seem-too-comfortable-and-that-makes-us-nervous

 

            BofA slashes S&P year-end target.

            https://www.zerohedge.com/markets/bofa-capitulates-slashes-sp-target-street-low-3600-recession-unfolds-warns-drop-3000

 

    News on Stocks in Our Portfolios

 

BlackRock press release (NYSE:BLK): Q2 Non-GAAP EPS of $7.36 misses by $0.66.

Revenue of $4.53B (-6.0% Y/Y) in-line.

 

What I am reading today

 

            Texas’s wounded power grid.

            https://www.masterresource.org/texas/texas-wounded-grid-windpower/

 

 

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