2 July Volatility Events to Watch Out For (or Maybe Profit From)
I see 2 big volatility events ahead of us in July that are powerful enough to move stocks. Get on the right side of these and there’s money to be made. Here’s how I handicap these two events. First, the Consumer Price Index report on inflation for June is...
Please Watch My New YouTube Video: “Ouch! The Fed Gets Honest About Inflation”
My one-hundred-and-forty-eighth YouTube video “Ouch! The Fed Gets Honest About Inflation” went up today. In front of the Senate Finance Committee today, Fed chair Jerome Powell said that the Fed has all the tools it needs to fight inflation–except,...
Biting the (Federal Reserve) bullet and selling two yield ETFs out of my Dividend Portfolio
I’ve overstayed my welcome in the Vanguard Short-Term Treasury ETF (VGSH) and the VanEck Preferred Securities ex-Financials ETF (PFXF), but with the Federal Reserve accelerating its interest rate increases, I think selling these two members of my Dividend...
Please Watch My New YouTube Video: Rip the Band-Aid Off on Interest Rates
My one-hundred-and-forty-seventh YouTube video “Rip the Band-Aid Off on Interest Rates” went up today. My Trend of the Week video this week looks at hedge fund gurus who have been yelling that the Federal Reserve needs even bigger interest rate increases...
A bigger than consensus 75 basis-point interest rate increase from the Federal Reserve tomorrow could produce a stock market rally
I know this seems bass-ackwards. Stocks have spent two days in a vigorous sell off because of fears of higher interest rates and worries, after Friday’s surprise surge in CPI inflation to an 8.6% annual rate in May, that the Fed might decide to raise interest...Fed faces inflation “disaster” as data show signs that inflation expectations are becoming embedded
The latest Consumer Expectations survey (that is for May) from the New York Federal Reserve shows U.S. households’ anticipate inflation will rise at a 6.6% annual rate over the next year. That’s up from April expectations for a 6.3% rate. The May...
Stocks plunge as May CPI inflation rises to 8.6%
Headline Consumer Price Index inflation in May rose to a new annual high rate of 8.6% in May, the Bureau of Labor Statistics reported today, June 10. Headline prices rose 1% from April. The big drivers were, as expected, food (with prices up at a 10.1% annual rate)...
Please Watch My New You Tube Video: “The Treasury Yield Tide Is Rising”
My one-hundred-and-forty-second YouTube video “The Treasury Yield Tide Is Rising” went up today. Yields are up for 2-, 5-, and 10-year Treasuries. I’m also seeing higher expectations for more rate increases in the coming Fed meetings with the odds...
Please watch my new YouTube video: Beware the Dot Plot
My one-hundredth-and-thirty-ninth YouTube video “Beware the Dot Plot” went up today. The next Fed meeting is June 15, and I think there isn’t much to worry about in terms of a coming rate increase (we know it will be 50 basis points, which the market...
Watch my new YouTube video: Trend of the Week Housing market cools
My one-hundredth-and-thirty-eighth YouTube video “Trend of the Week:Housing market cools” went up today. We’re seeing some of the first effects of the Fed’s increase in interest rates in the cooling of the housing market. In Austin, for...
Please watch my new YouTube video: We’re headed to a recession…if the Fed is serious about fighting inflation
My one-hundredth-and-thirty-seventh YouTube video “We’re headed to a recession…if the Fed is serious about fighting inflation” went up today. Please watch and subscribe to my YouTube channel. And like my video. Here’s the...
The Fed will engineer a recession–more details not in the video
In today’s YouTube video I argue that the Federal Reserve will have engineer a recession if it is serious about bringing inflation under control. This post gets more into the specific details of why I think that’s true than the video does. (I suggest...
Fed’s minutes from May meeting reassure markets; everybody is on the same page on interest rates
Minutes from the Federal Reserve’s May 4 meeting shows central bank officials in agreement on the ned for 50-basis-point interest rate increases at the June and July meetings. And then, the minutes say, the Fed would respond to developments in the economy either...
Inflation takes a huge bite out of Target income–and the market worries, big time
As of 3:30 p.m. Wednesday May 18 shares of Target (TGT) were down 25% for the day after the company reported a big earnings miss for the first quarter. Let’s be clear. The sales picture at Target was very positive for the quarter. Same store sales were up 3.3%...
Fed’s Bullard says two 50 basis point increases and a move to 3.5% by end of year are a “good benchmark”
But did he have to say it? The financial market would prefer not to think about inflation all the time. The markets are indeed pretty good at ignoring the inconvenient. But this morning Federal Reserve Bank of St. Louis President James Bullard said out loud what Wall...
Inflation fell in April but not by as much as Wall Street had hoped
Inflation, as measured by the Consumer Price Index, fell in April to a year over year rate of 8.3%. That was down from an 8.5% rate in March, raising hopes that the economy had seen the inflation peak. But economists had been projecting a drop to 8.0% in April. Which...
Will Wednesday’s CPI show April peak for inflation?
Normally, a report of 8% year over year inflation wouldn’t be considered good news for the financial markets. But in case you haven’t noticed, these aren’t normal times. Which means a report of 8% year over year inflation in April in the Consumer...
U.S. economy adds 428,000 jobs in April; stock market says, Oh! No!
The U.S. economy aded 428,000 jobs in April, the Labor Department reported today, May 6. That matched the jobs gains in M arch and was above e the 380,000 jobs expected by economists surveyed by Bloomberg. The official unemployment rate remained at 3.6%. Economists...
Headed your way–a flood of numbers on the economy; here’s my preview
Data, data everywhere in the next two days. From inflation to GDP. To begin with the Bureau of Economic Analysis is scheduled to report first quarter U.S. GDP growth on April 28. Economists expect to see that the economy has grown at an annualized rate of just 1.1% in...
Headed your way–a flood of numbers on the economy; here’s my preview
Data, data everywhere in the next two days. From inflation to GDP. To begin with the Bureau of Economic Analysis is scheduled to report first quarter U.S. GDP growth tomorrow, April 28. Economists expect to see that the economy has grown at an annualized rate of just...
Projections of more aggressive Federal Reserve continue to hammer stocks
The financial markets have moved from pricing in 50 basis point increases in the Federal Reserve’s target interest rate at the May 4 and June 15 meetings to considering the possibility that the Fed will increase rates by 75 basis points in June and July. A 25...
Please watch my new YouTube video: Netflix, Inflation, and Demand Destruction”
My one-hundredth-and-twenty-third YouTube video “Netflix, Inflation, and Demand Destruction” went up today. Today I’m covering Netflix’s (NFLX) crash after releasing subscriber numbers showing the loss of 200K subscribers for the quarter and...Even worse inflation news in today’s Producer Price Index–especially on food
The Producer Price Index (PPI), which tracks prices at the wholesale level, showed a 2.4% month to month increase in food costs for March from February. the Bureau of Labor Statistics reported this morning. That was the biggest month to month increase in 10 months....
Stocks rally on bad inflation news in the morning and then give it all back (on second thoughts) in the afternoon
As of noon New York time today, April 12, the Standard & Poor’s 500 was up 0.47% and the Dow Jones Industrial Average had gained 0.34%. The NASDAQ Composite was higher by 0.73% and the NASDAQ 100 had moved up by 0.67%. The small cap Russell 2000 had tacked...
This drought on the Great Plains couldn’t be coming at a worse time for food prices and grain supplies
The Great Plains could see its most significant drought in a decade, Becky Bolinger, assistant state climatologist for Colorado and a research scientist at Colorado State University, wrote in the Washington Post on April 11. According to the U.S. Drought Monitor, 70%...
The Fed looks to have lost the battle on inflation expectations
Economists surveyed by Bloomberg now say that consumer price index (CPI) inflation will average 5.7% in the final three months of 2022. That’s up from a forecast of 4.5% a month ago. (The March CPI report is due on Tuesday, April 12.) These economists also upped...
Fed March minutes show central bank as hawkish on interest rates as expected/feared
Minutes from the March meeting of the Federal Reserve released Wednesday, April 6, showed that only Russia’s invasion of Ukraine kept the central bank from raising benchmark interest rates by 50 basis points instead the 25 basis-point increase the Fed actually...
Ooof! Yield on 10-year Treasury hits 2.38% at the close today
As of the close today, Tuesday, March 22, Treasuries had sold off steeply raising the yield on the 10-year Treasury to 2.38%, a huge (for the Treasury bond market) 9 basis points. The rout took the yield on the 2-year Treasury to 2.16%. On Friday,March 18, the 2-year...
Airlines climb on oil drop, traffic pickup–now it gets tricky
Oil prices collapsed. And airlines reported a better than expected pick up in traffic. So airline stocks soared with the most stressed operators showing the biggest gains in their shares. Delta Air Lines (DAL) closed up 8.70% on the day. United Airlines (ULA) picked...Jim’s Daily Email Alerts:
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