Paid Good News Is Bad News Oct 17, 2023 2 min read paid Today's September reports for retail sales and industrial production were better than expected. The Atlanta Fed's GDPNow tracking model shows real GDP grew 5.4% (saar) during Q3, up from 5.1% on October 10. Leading the estimate higher is real consumer spending with a 4.1% increase (table). That's good news for the stock market. It confirms our forecast that S&P Ed Yardeni
Paid Upside Surprises Aug 16, 2023 2 min read paid The economy isn't landing; it's flying high. Following better-than-expected July reports for housing starts and industrial production this morning, the Atlanta Fed's GDPNow tracking model raised Q3's real GDP growth rate to 5.8% (saar) from 5.0%, after raising it from 4.1% yesterday on a better-than-expected July retail sales report (chart). Consumer spending and residential investment are now tracking at Ed Yardeni
Paid The Economic Week Ahead: August 14-18 Aug 12, 2023 2 min read paid This week is packed with July's composite cyclical indicator releases which should ease fears that economic growth might be too strong given that real GDP is tracking at 4.1% (saar) for Q3 currently. That's quite a reversal from a few months ago when there were widespread fears of a recession. Consider the following: (1) The YRI Earned Income Proxy for private-industry wages and salaries in Ed Yardeni
Paid Inflation Remains On Downward Trend Aug 10, 2023 2 min read paid The FOMC can take the rest of the year off. The federal funds rate is now restrictive enough to bring inflation down without causing a recession, in our opinion. The banking crisis in March, Moody's recent downgrade of several regional banks, and the Fed's latest Senior Loan Officer Opinion Survey all confirm that credit conditions are tightening. The economic data confirm that the economy remains resilient Ed Yardeni
Public The Bull Deserves A Rest Jul 27, 2023 2 min read The bull market's winning streak ended today. The Dow closed higher for 13 straight sessions through Wednesday, its longest series of positive closes since 1987. It was down 0.67% today. The Dow's longest-ever winning streak was 14 sessions, set in 1897, according to S&P Dow Jones Indices. The S&P 500 closed at 4537.41 today after hitting a bull market intraday Ed Yardeni
Paid The Economic Week Ahead: July 24-28 Jul 23, 2023 2 min read paid The Fed is widely expected to hike the federal funds rate (FFR) on Wednesday by 25bps to a range of 5.25%-5.50%. Will that be restrictive enough for the Fed? Will that be the terminal rate? At his presser on Wednesday after the FOMC meeting, Fed Chair Jerome Powell is likely to say: "Maybe, maybe not." He will acknowledge that inflation is still moderating even though Ed Yardeni
Paid Rolling Expansion? Jun 20, 2023 2 min read paid What happens after a rolling recession? Perhaps a rolling expansion as the economic sectors that fell into a recession recover. Today's housing starts report for May was certainly strong. Housing starts jumped 21.6% to 1.63 million units (saar) last month from April's 1.34 million (chart). It was the largest percentage gain since October 2016. A survey on Monday showed the National Association of Ed Yardeni
Paid A Hawkish Skip at the Fed Jun 14, 2023 2 min read paid In this past Sunday's QT, we wrote: "On Wednesday, Fed Chair Jerome Powell will update us on the committee's latest views. Odds are the FOMC will skip another rate hike, but hint that rate hiking might not be over." Sure enough, the FOMC skipped and the committee's statement noted: "Holding the target range steady at this meeting allows the Committee to Ed Yardeni
Paid The Economy Is Still Gliding Along May 28, 2023 2 min read paid Apparently, the debt ceiling issue has been resolved over the weekend, as we expected. The stock market might rally on Tuesday, but it has been taking the issue in stride focusing more on AI than Washington's political theater. The economy continues to glide calmly as evidenced by Friday's personal income report for April. The Atlanta Fed's GDPNow tracking model raised Q2's real Ed Yardeni
Public Inventories Depress GDP Apr 27, 2023 1 min read Economic growth wasn't as weak as suggested by real GDP which rose only 1.1% (saar) during Q1. During Q4, inventories surged as consumers pivoted from buying goods to purchasing services. Goods producers and providers stopped building unwanted inventories by cutting their orders to their suppliers and by lowering their prices to move their excess merchandise out the front door. So, excluding inventories, real final sales rose 3. Ed Yardeni
Public Falling Interest Rates Apr 4, 2023 2 min read Interest rates continued to fall today after Jamie Dimon, who is the President, CEO & Chairman of JP Morgan Chase, warned that the banking crisis is "not yet over" and will cause "repercussions for years to come." He did so in his annual letter to stockholders. With all those titles, he must know what he is talking about. He observed that potential losses from held-to-maturity bonds, Ed Yardeni
Public Born To Shop & Fly Feb 15, 2023 1 min read We aren't that surprised by the 3.0% m/m jump in retail sales reported today. When January's employment data were released, we calculated our Earned Income Proxy for private wages and salaries in personal income (chart). It soared 1.5% m/m as the average workweek jumped 0.9%, payrolls increased 0.3%, and average hourly earnings rose 0.3%. American consumers are doing what Ed Yardeni