The Morning Call---The Fed's fake victory over inflation

 

The Morning Call

 

7/16/24

 

The Market

         

    Technical

 

            Monday in the charts.

            https://www.zerohedge.com/markets/gold-crypto-soar-yield-curve-dis-inverts-small-caps-crush-big-tech-again

 

            Update on breadth. The first paragraph is new; the rest is a repeat of yesterday’s                post.

            https://traderfeed.blogspot.com/2024/07/two-important-takeaways-from-recent.html

 

            Institutions have never been longer equity futures.

            https://www.zerohedge.com/markets/institutions-have-never-been-longer-equity-futures-and-shorter-vix-vega

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

June retail sales were flat versus May as estimated; ex autos, they were up 0.4% versus +0.1%.

                          https://www.zerohedge.com/markets/us-retail-sales-upward-surprise-june-food-spending-jumped-car-sales-plunged

 

                        International

 

The May EU trade balance was +E13.0 billion versus projections of +E18.0 billion; the July economic sentiment index was 43.7 versus 48.1.

 

The July German economic sentiment index was 41.8 versus forecasts of 42.5; the July current conditions index was -68.9 versus -74.3.

 

                        Other

 

            Monetary Policy

 

              Confidence grows in September rate cut.

              https://www.capitalspectator.com/markets-confident-that-rate-cuts-will-start-in-september/

 

              The Fed’s fake victory over inflation.

               https://www.zerohedge.com/markets/david-stockman-exposes-feds-fake-victory-over-inflation

 

            Inflation

 

              Policy types cheer the demise of inflation, just as it arrives.

              https://www.forbes.com/sites/johntamny/2024/07/14/as-policy-types-cheer-demise-of-fake-inflation-the-real-one-arrives/

 

            Recession

 

              Recession Alert weekly economic index.

              https://www.advisorperspectives.com/dshort/updates/2024/07/15/recession-weekly-leading-economic-index

 

              China’s economic growth comes in lower than expected.

  https://www.bloomberg.com/news/articles/2024-07-15/china-growth-weakens-more-than-expected-as-outlook-darkens?srnd=homepage-americas&sref=loFkkPMQ

 

 

            Tariffs

 

              Tariffs as a major source of revenues.

              https://econbrowser.com/archives/2024/07/cea-tariffs-as-a-major-revenue-source-implications-for-distribution-and-growth

 

            Civil Strife

 

              Attitude adjustments.

              https://www.advisorperspectives.com/commentaries/2024/07/15/attitude-adjustments-john-mauldin

 

     Bottom line

 

I often praise the ability of the bond market to more accurately anticipate future economic events than the stock market. Here is some cognitive dissonance to that point of view as well as an indication that inflation has not been whipped.

            https://wolfstreet.com/2024/07/13/what-the-short-term-treasury-market-says-about-rate-cuts-and-how-wrong-it-was-so-far/

 

    News on Stocks in Our Portfolios

 

What I am reading today

 

           

                        The best US national parks.

            https://www.wsj.com/lifestyle/travel/best-uncrowded-national-parks-5a65e80a

 

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