The Morning Call---The recession dilemma

The Morning Call

 

7/21/23

 

The Market

         

    Technical

 

            Thursday in the charts.

            https://www.zerohedge.com/markets/bonds-big-tech-bullion-bitcoin-breakdown-greenback-gains

 

            Long/short hedge funds are in trouble.

            https://www.zerohedge.com/markets/unprecedented-hedge-fund-destruction-sparks-massive-degrossing-offside-exposure-hits-march

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

                          June existing home sales fell 3.3% versus forecasts of -1.2%.

                          https://www.advisorperspectives.com/dshort/updates/2023/07/20/existing-home-sales-retreat-prices-remain-high

 

The June leading economic index was down 0.7% versus estimates of -0.6%.

                          https://www.advisorperspectives.com/dshort/updates/2023/07/20/leading-economic-index-conference-board-recession-signal-continues

 

                        International

 

                          June Japanese CPI came in at +0.2%, in line.

 

June UK retail sales were up 0.7% versus expectations of +0.2%; ex fuel, they were +0.8% versus +0.2%; the July consumer confidence index was -30 versus -26.

 

July EU flash consumer confidence index was -15.1 versus predictions of -16.0.

 

                        Other

                         

Is there any information value in the index of leading economic indicators?

                          https://politicalcalculations.blogspot.com/2023/07/less-than-useful-data-index-of-leading.html

                                  

Will the job killing results of AI really be as catastrophic as some postulate?

https://www.adamsmith.org/blog/ai-is-going-to-kill-all-the-jobs-isnt-that-wonderful

 

If you weaponize the dollar, expect retaliation (must read).

https://www.zerohedge.com/economics/lesson-day-if-you-weaponize-dollar-and-confiscate-assets-expect-retaliation

 

             The Fed

 

                One and done---now consensus among economists.

                https://www.bloomberg.com/news/articles/2023-07-20/fed-seen-hiking-final-time-to-a-22-year-peak-in-economist-survey?srnd=premium&sref=loFkkPMQ

 

            Fiscal Policy

 

              This article is a bit over the top, but it does point to the issue of government waste.

              https://www.americanthinker.com/blog/2023/07/empty_suit_empty_suites_joe_bidens_government_of_empty_buildings.html

 

            Recession

 

              The recession dilemma.

              https://www.nytimes.com/2023/07/19/business/economy/economy-soft-landing.html

 

Wishful thinking about a ‘soft’ landing.  This author defines it as the Fed meeting its inflation target at 3% not 2%.

https://econbrowser.com/archives/2023/07/guest-contribution-isnt-this-what-a-soft-landing-would-look-like

 

                  Here is a bit more realistic view of current conditions (must read).

              https://www.advisorperspectives.com/commentaries/2023/07/20/checkers-vs-chess-global-bond-inflation

 

                  And this one sums up the prevailing confusion.

  https://www.reuters.com/markets/europe/inflation-undershoot-narrative-shifts-again-2023-07-19/?utm_campaign=What%20I%20Am%20Reading&utm_medium=email&_hsmi=267085429&_hsenc=p2ANqtz-_zGo7hpr0dlq3ND4ek1ADDTGO4bjwqwXhiiXd5XX6jN_168U4PWHYBD-tNqX_mQ7ipbektpKjEK7rxjG4Fl_Hk43bdYg&utm_content=267085429&utm_source=hs_email

 

                  Jobless claims show recession risk is brewing.

              https://www.zerohedge.com/markets/claims-show-recession-risk-brewing-and-credit-mispriced

 

Billionaire investor says commercial real estate market now a category five hurricane.

https://www.zerohedge.com/markets/billionaire-sternlicht-warns-cre-storm-now-category-5-hurricane

 

     Bottom line

 

            Three experts on the biggest risks to the economy/Market.

https://www.bloomberg.com/news/features/2023-07-20/3-biggest-risks-to-the-us-stock-market-according-to-wall-street-titans?srnd=premium&sref=loFkkPMQ#xj4y7vzkg

 

 

    News on Stocks in Our Portfolios

 

What I am reading today

 

           

Quote of the day.

https://cafehayek.com/2023/07/quotation-of-the-day-4331.html

 

Friday morning humor.

https://babylonbee.com/news/trump-indicted-for-the-1996-murder-of-tupac-shakur

 

 

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