Friday, January 30, 2026

The Morning Call--Another Trump Alfred Hitchcock surprise ending, picking Kevin Warsh for Fed chair---the most hawkish of the four candidates.

 

The Morning Call

 

1/30/26

 

The Market

         

    Technical

 

            Thursday in the charts.

            https://www.zerohedge.com/markets/bitcoin-battered-everything-else-bounces-back-early-bloodbath

 

Note: after a volatile day, the S&P remained above its former all-time high long enough to confirm a breakout (for a second time and on questionable breadth). So, this one isn’t anymore impressive than the former, meaning that there is probably still more digestion coming before a major move higher (assuming that there is one)---but that is just me speculating. The key, as always, is follow through. In my opinion, this is not yet a Market to be investing in.

           

            Another yo yo day.

            Another Yo-Yo Day In The Markets

           

            Déjà vu, all over again.

            https://www.zerohedge.com/the-market-ear/everything-goes-again

 

            More from Morgan Stanley.

                https://www.zerohedge.com/markets/morgan-stanley-quants-2-drop-will-trigger1-45bn-forced-selling

 

            More from Nomura.

            https://www.zerohedge.com/markets/lazy-longs-forced-through-skinny-exits-nomura-offers-some-good-news-now

           

            Thursday in the technical stats.

            https://www.barchart.com/stocks/momentum

            https://www.barchart.com/stocks/sectors/rankings

            https://www.barchart.com/stocks/signals/new-recommendations

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

December PPI was up 0.5% versus estimates of +0.2%; ex food and energy, it was up 0.4% versus +0.3%.

                          https://www.zerohedge.com/personal-finance/us-producer-prices-unexpectedly-surged-december

 

                        International

 

The December Japanese unemployment rate was 2.6%, in line; preliminary December industrial production was down 0.2%, in line; preliminary December retail sales were down 2.0% versus +0.3%; December YoY housing starts were down 1.3% versus -4.4%; December YoY construction orders were up 20.2% versus -3.0%; January YoY CPI was up 1.5%, in line.

 

Q4 German flash GDP growth was +0.3% versus expectations of +0.2%; January GDP growth was up 0.1% versus -0.1%; the January unemployment rate was 6.3%, in line.

 

Q4 EU flash GDP growth was +0.3% versus forecasts of +0.2%; the December unemployment rate was 6.2% versus 6.3%.

 

                        Other

 

                          A closer look at yesterday’s weekly jobless claims number.

                          https://bonddad.blogspot.com/2026/01/jobless-claims-positive-regime-change.html

 

            Overnight News

 

Another Trump Alfred Hitchcock surprise ending, picking Kevin Warsh for Fed chair---the most hawkish of the four candidates. (The Market may not like this, but it is potentially the best thing that could happen long term for the economy.)

https://www.zerohedge.com/markets/trump-reportedly-announce-kevin-warsh-next-fed-chair-friday-morning-bitcoin-gold-tumble

 

            Monetary Policy

 

              Dear Mr. Powell, are you sure that the Fed is in a good place?

              https://mishtalk.com/economics/dear-jerome-powell-are-you-sure-the-fed-is-in-a-good-place/

 

            Fiscal Policy

 

              The perils of a falling dollar.

                  https://www.wsj.com/opinion/donald-trump-weak-dollar-economy-exchange-rates-101b278a?mod=opinion_lead_pos1

 

              Update on shutdown.

              https://www.zerohedge.com/political/shutdown-approaches-schumer-white-house-attempt-11th-hour-deal

 

            Inflation

 

M2 growth fuels strong economic growth with low inflation. (This analyst is my favorite economic optimist. In this article’s case, while the declining rate of M2 growth is still consistent with sound economic growth and unquestionably a plus for a declining rate of inflation, his own chart shows that M2 growth is still not back to a rate consistent with 2% inflation [the Fed’s purported goal].)

https://scottgrannis.blogspot.com/2026/01/slow-m2-growth-fuels-stronger-economic.html

 

              Counterpoint.

              https://www.capitalspectator.com/the-feds-job-isnt-getting-any-easier/

 

            The Dollar

 

Dollar downer. (This is a progressive blog. While I agree with most of the analysis of the causes of a weakening dollar, I think that the ‘rule of law’ point is political not economic.)

https://econbrowser.com/archives/2026/01/kamin-sobel-termites-are-slowly-feasting-away-at-the-foundations-of-the-dollars-dominance

 

              Counterpoint.

              https://talkmarkets.com/content/currenciesforex/the-dollar-is-collapsing-is-it?post=553652

 

     Investing

 

            How inflation uncertainty may impact your bond portfolio.

            Rate Expectations Update: How Inflation Uncertainty May Impact Your Bond Portfolio - Carson Group

 

Should we worry about a gold crash? (as you can tell by the name of the organization the author works for, he is talking his book. That said, as he points out the economic conditions that have been a precursor to a selloff in gold don’t exist right now. On the other hand, if gold simply returns to the upper boundary of its short term uptrend, it would fall 20% from current levels.)

https://talkmarkets.com/content/commodities/should-we-worry-about-a-gold-crash?post=553651

 

            Why is there less junk’ in the high yield bond market?

            https://www.morningstar.com/bonds/why-there-is-lot-less-junk-high-yield-bond-market

 

    News on Stocks in Our Portfolio

 

 

What I am reading today

 

            Friday morning humor.

            Promises Kept: Here Are The 9 Biggest Accomplishments Of The Republican Congress | Babylon Bee

 

 

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