The Morning Call--Rate cuts now a matter of if, not just when.

 

The Morning Call

 

4/12/24

 

The Market

         

    Technical

 

            Thursday in the charts.

            https://www.zerohedge.com/markets/stocks-surge-goldgasms-record-high-after-adjusted-ppi-sparks-buying-frenzy

 

            Gold fires a warning shot.

            https://www.zerohedge.com/markets/godl-precious-metal-soars-above-2400-after-sudden-gap-higher

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

                        International

 

February Japanese industrial production fell 0.6% versus predictions of -0.1%.

 

February UK GDP grew 0.1%, in line; the February trade balance was L-14.2 billion versus L-14.5billion; February industrial production was up 1.1% versus 0.0%; February YoY construction output was down 2.0% versus down 1.0%.

 

The March Chinese trade balance was $58.2 billion versus consensus of $70.2 billion.

 

March German CPI was up 0.4%, in line.

 

                        Other

 

            The Fed

 

              Next rate cut not until November?

              https://disciplinefunds.com/2024/04/10/no-or-november/

 

              From the Fed whisperer: Rate cuts are now a matter of if, not just when.

              https://www.wsj.com/economy/central-banking/fed-rate-cuts-are-now-a-matter-of-if-not-just-when-144a978e?mod=economy_lead_pos3

 

              Larry Summers says next Fed rate move may be a hike.

  https://www.bloomberg.com/news/articles/2024-04-10/summers-says-have-to-seriously-consider-next-fed-move-is-a-hike?utm_source=website&utm_medium=share&utm_campaign=twitter&sref=loFkkPMQ

 

 

            Fiscal Policy

 

              Earmark madness.

              https://www.city-journal.org/article/earmark-madness

 

              Responsibility for the national debt/deficit falls on both parties.

              https://www.usatoday.com/story/opinion/columnist/2024/04/10/inflation-biden-economy-americans-spending-income-wages/73275197007/

 

              Who pays the taxes?

              https://www.wsj.com/articles/americas-secret-progressive-income-tax-fair-share-3b19ba41?mod=opinion_lead_pos4

 

            Inflation

 

              Beneath the headlines, inflation is behaving very badly.

              https://www.nakedcapitalism.com/2024/04/beneath-the-skin-of-cpi-inflation-march-inflation-behaves-very-badly-saga-far-from-over.html

 

            Recession

 

              The consensus is that the probability of recession is declining.

              https://www.apolloacademy.com/us-recession-probability-declining/

 

            Soft landing or no landing?

            https://www.nytimes.com/2024/04/11/business/economy/federal-reserve-soft-no-landing.html

 

     Bottom line.

 

            The argument against focusing on dividends.

            https://www.morningstar.com/portfolios/there-is-nothing-special-about-dividends

 

    News on Stocks in Our Portfolios

 

BlackRock press release (NYSE:BLK): Q1 Non-GAAP EPS of $9.81 beats by $0.44.

Revenue of $4.73B (+11.4% Y/Y) beats by $20M.

 

 

What I am reading today

 

           

                        Friday morning humor:  Unfortunately, this guy is supposed to be defending us.

            https://townhall.com/tipsheet/leahbarkoukis/2024/04/11/us-navy-deletes-embarrassing-photo-n2637633

 

                Who was Mary Magdalene?

            Who was Mary Magdalene? Historians are still trying to figure that out. (nationalgeographic.com)

 

 

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The Morning Call--We are getting close to a selling tsunami

 

The Morning Call

 

4/11/24

 

 

The Market

         

    Technical

 

            Wednesday in the charts.

            https://www.zerohedge.com/markets/all-bets-are

 

            We are getting close to a selling tsunami.

            https://www.zerohedge.com/the-market-ear/we-are-getting-closer-cta-selling-tsunami

 

            Who is the source of gold buying?

            https://www.nytimes.com/2024/04/10/business/gold-price-inflation.html

 

            Is gold overpriced?

            https://www.zerohedge.com/markets/gold-overpriced-or-can-its-price-go-even-higher

 

            What is driving gold prices?

            https://www.zerohedge.com/markets/gold-warning-us-or-running-markets

 

            Money market funds are raking in the cash.

            https://sherwood.news/markets/money-funds-are-raking-in-record-amounts-of-cash/

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

Weekly initial jobless claims totaled 211,000 versus projections of 215,000.

 

The Mrach budget deficit was $236 billion versus consensus of $197 billion.

                          https://www.zerohedge.com/markets/us-deficit-tops-11-trillion-first-six-months-fiscal-2024-spending-hits-2024-high

 

March PPI was up 0.2% versus estimates of up 0.3%; core PPI was up 0.2%, in line.

 

                        International

 

March Chinese CPI was down 1.0% versus expectations of -0.5%; March YoY PPI was -2.8%, in line.

 

                        Other

 

            The Fed

 

              Markets lower rate cut probabilities.

              https://www.ft.com/content/0395f49d-ac44-4698-afc2-d4784204cf41

 

The FOMC released the minutes from its latest meeting but those were dwarfed by the earlier reported CPI number (above).

              https://www.calculatedriskblog.com/2024/04/fomc-minutes-uncertainty-about.html

 

              Bank of Canada leaves rates unchanged.

              https://www.zerohedge.com/markets/bank-canada-keeps-rates-unchanged-needs-more-evidence-slowing-inflation-cuts

 

              ECB leaves rates unchanged.

              https://www.zerohedge.com/markets/euro-extends-decline-after-ecb-holds-rates-highs-hints-cuts-come

 

           

            Inflation

 

              Inside the CPI number.

              https://www.calculatedriskblog.com/2024/04/yoy-measures-of-inflation-services.html

 

            Recession

 

              Corporate credit and economic growth.

              https://alhambrapartners.com/2024/04/09/market-morsel-cash-and-carry/

 

            China

 

              China/US trade may have bottomed.

              https://politicalcalculations.blogspot.com/2024/04/us-china-trade-decline-may-have-hit.html

 

              Fitch downgrades China’s outlook.

              https://www.cnn.com/2024/04/10/economy/china-fitch-rating-downgrade-intl-hnk/index.html

 

     Bottom line.

           

            Stocks in a ‘no landing’ scenario.

            https://investorplace.com/hypergrowthinvesting/2024/04/in-a-no-landing-scenario-growth-stocks-will-be-king/

 

            Election uncertainty argues for high quality bonds.

            https://www.advisorperspectives.com/commentaries/2024/04/10/2024-election-uncertainty-drive-fixed-income-outperformance

 

            Earnings season may bring changes.

            https://www.advisorperspectives.com/commentaries/2024/04/10/earnings-season-may-bring-changes

 

    News on Stocks in Our Portfolios

 

Fastenal press release (NASDAQ:FAST): Q1 GAAP EPS of $0.52 misses by $0.01.

Revenue of $1.89B (+1.9% Y/Y) misses by $20M.

 

Fastenal (NASDAQ:FAST) declared $0.39/share quarterly dividend, in line with previous.

 

 

What I am reading today

           

 

 

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The Morning Call--Something is breaking

 

The Morning Call

 

4/10/24

 

The Market

         

    Technical

 

            Tuesday in the charts.

            https://www.zerohedge.com/markets/markets-suffer-conniptions-ahead-crucial-consumer-price-print

 

            Margin debt surges.

            Margin Debt Surges As Bulls Leverage Bets - RIA (realinvestmentadvice.com)

 

            Trade of the decade.

            https://allstarcharts.com/trade-of-the-decade/

           

            Risk-on sentiment persists.

            https://www.capitalspectator.com/risk-on-sentiment-persists-defying-gravity-and-logic/

 

            Gold is now overbought.

            https://www.zerohedge.com/the-market-ear/3-gold-charts-we-are-watching-time-chill

 

            Gold, inflation and interest rates.

            https://www.zerohedge.com/markets/inflation-has-become-bigger-risk-stretched-gold-prices

 

            A warning from Goldman’s flows guru.

            https://www.zerohedge.com/markets/goldman-flows-guru-warns-us-stocks-face-escalator-ride-elevator-ride-down

 

            Something is breaking.

            https://www.zerohedge.com/markets/somethings-breaking

 

            I sold my IWN and GDX trading positions.

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

Weekly mortgage applications were up 0.1% but purchase applications were down 5.0%.

 

Month to date retail chain store sales grew slightly faster than in the prior week.

 

March CPI was up 0.4%versus estimates of +0.3%; core CPI was also up 0.4% versus +0.3%.

                          https://www.zerohedge.com/markets/consumer-prices-print-hotter-expected-led-surge-energy-shelter-costs

 

                        International

 

                          March Japanese PPI was up 0.2% versus predictions of +0.3%.

 

                          March Chinese YoY vehicle sales rose 9.9% versus consensus of up 4.0%.

 

                        Other

 

                          Economic confidence slips in April.

                          https://www.realclearmarkets.com/articles/2024/04/09/americans_economic_confidence_slips_in_april_1023819.html

 

                          Survey of consumer expectations.

                          https://www.newyorkfed.org/microeconomics/sce#/

 

                          Q1 retail vacancy rate unchanged.

                          https://www.calculatedriskblog.com/2024/04/moodys-retail-vacancy-rate-unchanged-in.html

 

            The Fed

 

              The Fed’s ‘higher for longer’ dilemma.

              https://www.nytimes.com/2024/04/09/business/economy/interest-rates-inflation-federal-reserve.html

 

              Part 2.

              https://www.bloomberg.com/news/articles/2024-04-09/bullard-says-three-interest-rate-cuts-this-year-is-base-case?srnd=homepage-americas&sref=loFkkPMQ

 

              Goldman and AMEX cut rates on savings accounts.

              https://www.zerohedge.com/markets/what-do-they-know-goldman-amex-quietly-cut-rates-savings-accounts-fed-next

 

            Inflation

 

              New home prices ae down but still unaffordable to the average household.

              https://politicalcalculations.blogspot.com/2024/04/new-home-prices-fall-still-unaffordable.html

 

            Recession

 

              What recession?

              https://ritholtz.com/2024/04/what-recession-state-coincident-indicators/

 

            China

 

Yellen apparently didn’t do a very good job in addressing Chinese overproduction.

https://www.nakedcapitalism.com/2024/04/yellen-and-biden-administration-incompetence-bullying-and-entitlement-rather-than-making-a-case-here-regarding-china-overproduction.html

 

     Bottom line.

 

            A look at Q1 earnings season.

            https://alhambrapartners.com/2024/04/07/weekly-market-pulse-a-new-paradigm/?src=news

 

            Market corrections matter more than you think (must read).

            https://www.advisorperspectives.com/commentaries/2024/04/09/market-corrections-matter-more-lance-roberts

 

    News on Stocks in Our Portfolios

 

 

What I am reading today

 

           

                        Quote of the day.

            https://cafehayek.com/2024/04/quotation-of-the-day-4601.html

 

 

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