Tuesday, February 25, 2025

The Morning Call---The level of uncertainty is rising

 

The Morning Call

 

2/25/25

 

The Market

         

    Technical

 

            Monday in the charts.

            https://www.zerohedge.com/market-recaps/no-panic-discomfort-high-bonds-bullion-bid-momo-meme-stock-meltdown-continues

 

            Another bitcoin rally fails.

            https://talkmarkets.com/content/bitcoin-price-breakout-dreams-crushed-again-whats-next?post=483867

 

            Crypto crashing.

            https://www.zerohedge.com/the-market-ear/crypto-crashing

 

            Volatility playbook.

            https://talkmarkets.com/content/us-markets/volatility-playbook-key-levels-and-market-catalysts-to-watch-now?post=483852

 

            Stagflation vibe getting legs.

            https://www.zerohedge.com/markets/friday-saw-huge-buying-crash-puts-nomura-notes-stagflation-vibe-taking-hold

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

The February Dallas Fed manufacturing index reading was -8.3 versus consensus of +18.0.

 

                        International

 

                          Q4 German GDP growth was -0.2%, in line.

 

                        Other

 

                          Monday in the economic charts.

                          https://www.advisorperspectives.com/commentaries/2025/02/24/thoughts-revenue

 

                          Top 10% income bracket accounts for 50% of all spending.

                          https://mishtalk.com/economics/top-ten-percent-account-for-half-of-all-spending-up-from-36-percent/

 

            Overnight News

 

Donald Trump’s administration is sketching out tougher versions of US semiconductor curbs and pressuring key allies to escalate their restrictions on China’s chip industry, an early indication the new US president plans to expand efforts that began under Joe Biden to limit Beijing’s technological prowess.

 

President Donald Trump’s Federal Trade Commission will “vigorously” sue to block illegal mergers, the agency’s new chairman said Monday, highlighting support for the repeated deal challenges during the Biden era.

 

President Donald Trump said on Monday that tariffs on Canadian and Mexican imports are "on time and on schedule" despite efforts by the countries to beef up border security and halt the flow of fentanyl into the U.S. ahead of a March 4 deadline.

 

French President Emmanuel Macron said a truce in Ukraine could come in “weeks” after meeting with Trump at the White House but added that a deal “must not mean a surrender of Ukraine.”

 

Fed's Goolsbee (2025 voter) said if the administration enacts policies that drive up prices, the Fed has to take them into account by law, while he added that auto parts suppliers have expressed concerns about tariffs and before the Fed can go back to cutting rates, it needs more clarity. Furthermore, Goolsbee said the full details of the administration’s policy package are still to be determined and they have to take a wait-and-see posture.

 

            Fiscal Policy

 

              John Mauldin on increasing federal revenues.

              https://www.advisorperspectives.com/commentaries/2025/02/24/thoughts-revenue

 

            Inflation

 

              Declining confidence in controlling inflation.

              https://econbrowser.com/archives/2025/02/fed-inflation-credibility-index-under-trump

 

            Recession

 

              Employment weaker than thought.

              https://bonddad.blogspot.com/2025/02/q3-2024-qcew-suggests-employment-was.html

 

            China

 

              US China decoupling.

              https://www.zerohedge.com/markets/trumps-big-salvo-toward-us-china-decoupling

 

     Investing

 

            Update on the yield curve.

https://wolfstreet.com/2025/02/22/treasury-yield-curve-flattens-as-10-year-yield-falls-while-short-term-yields-stay-put-feds-pivot-to-wait-and-see-in-inflationary-times-but-mortgage-rates-stay-near-7/

 

The probabilities for errors are rising (I like Barry Ritholtz approach to investing. And I agree with much of this analysis. But keep in mind in reading this that his political leanings are left of center).

https://ritholtz.com/2025/02/probabilities-errors-rising/

 

            The level of uncertainty is rising.

            https://www.zerohedge.com/markets/all-roads-lead-mar-lago

 

    News on Stocks in Our Portfolios

 

 

What I am reading today

 

            Warren Buffett’s latest letter to shareholders.

            https://www.berkshirehathaway.com/letters/2024ltr.pdf

 

 

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