The Morning Call--Continued confusion about real Fed policy (assuming that there is one)

 

The Morning Call

 

1/6/23

 

The Market

         

    Technical

 

            Thursday in the charts.

            https://www.zerohedge.com/markets/stocks-bonds-dump-good-jobs-news-rate-hike-odds-jump

 

            Midterm years are historically up for the Market.

            https://allstarcharts.com/pre-election-years-80-hit-rate-after-down-mid-terms/

 

            The world says goodbye to negative yielding debt.

            https://finance.yahoo.com/news/world-says-goodbye-negative-yielding-055132690.html

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

December vehicle sales were 13.3 million units versus 13.1 million in November.

 

                        International

 

November Japanese average earnings were up 0.5% versus up 1.8% in October; the December services PMI was 51.1 versus 50.3 in November; the December composite PMI was 49.7 versus 48.9 in November.

 

November German retail sales grew 1.1% versus estimates of +1.0%; November factory orders fell 5.3% versus -0.5%.

 

November EU retail sales were up 0.8% versus consensus of +0.5%; December consumer confidence was -22.2, in line; December economic sentiment was 95.5 versus 94.7; December industrial sentiment was -1.5 versus -1.2; December CPI was -0.3% versus -0.1% in November.

 

                        Other

 

            The Fed

 

              The Fed dilemma---I could not have said this any better.

              https://nypost.com/2023/01/02/will-the-fed-blink-in-2023-and-extend-our-economic-agony/

 

              The Fed ‘pivot’ watch.

              https://www.capitalspectator.com/fed-pivot-watch-5-january-2023/

                  

  In these pages I have fretted numerous times about the lack of oversight of non-   bank financial institutions. They are big. Many use lots of leverage. And, at least some of them, appear not be concerned about assuming high levels of risk in pursuit of larger fees. Recent incidents in the British pension system, the crypto world and meme stocks illustrate the potential vulnerability of the global credit system. It appears that regulators have figured out that something needs to be done to ensure another credit crisis doesn’t occur. The only question is, are they too late?

             https://www.ft.com/content/1a75dee8-ffe1-402b-a890-5c9e84798d85

 

              Hedge funds are betting record amounts that the Fed will fold.

              https://www.zerohedge.com/markets/hedge-funds-are-betting-record-amounts-fed-will-fold-end-next-year

                 

 The Fed’s Bullard hints that they may be correct.

              https://www.zerohedge.com/markets/2023-may-be-disinflationary-year-rates-close-restrictive-stocks-jump-after-unexpectedly

 

            Fiscal Policy

 

              The need for fiscal responsibility.

              https://www.cato.org/blog/automatic-debt-limit-increases-fastrack-fiscal-ruin

 

            Inflation

 

              M2 and inflation.

              http://scottgrannis.blogspot.com/2023/01/the-inflation-tide-continues-to-recede.html

        

            Recession

 

               More stats measuring the likelihood of recession.

                  https://econbrowser.com/archives/2023/01/coincident-indicators-of-recession-vmt-heavy-truck-sales-sahm-rule

 

               Rents continue to decline more than seasonally normal.

               https://www.calculatedriskblog.com/2023/01/rents-continue-to-decline-more-than.html

 

     Bottom line

 

            December dividends by the numbers.

            https://politicalcalculations.blogspot.com/2023/01/dividends-by-numbers-in-december-2022.html#.Y7ccCHbMKUk

 

            Update on valuations.

            https://www.advisorperspectives.com/dshort/updates/2023/01/05/p-e10-december-2022-update

                https://www.advisorperspectives.com/dshort/updates/2023/01/05/the-q-ratio-and-market-valuation-december-update

 

    News on Stocks in Our Portfolios

 

 

 

What I am reading today

 

           

Is America suffering a social recession?

https://marginalrevolution.com/marginalrevolution/2023/01/is-america-suffering-a-social-recession.html

 

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