Conference Board

Neil Howe Warns The 'Professional Class' Is Still In Denial Of The Fourth Turning

"The world has fundamentally shifted over the last decade, especially since we’ve emerged from the Great Recession... But the professional class has been very slow to understand what is going on, not just quantitatively but qualitatively in a new generational configuration that I call the Fourth Turning. They don’t accept the new normal. They keep insisting, just two or three years out there on the horizon, that the old normal will return – in GDP growth, in housing starts, in global trade. But it doesn’t return."

Consumer Confidence Surges & Plunges

Everything is awesome... or terrible - depending on when you were asked. The Conference Board's consumer confidence surged to its highest since October 2015 at 98.1 (beating expectations of 96.5). However, Gallup shows economic confidence crashing back from a post-State of the Union bounce to its lowest since November 2015. Take your pick...

Crash Risk & The Imminent Likelihood Of Recession

"... there is presently an enormous chasm between the point where self-reinforcing selling pressure by speculators is likely to emerge, and the much lower point where balancing buying pressure by value-conscious investors is likely to support the market. Because every seller necessarily requires a buyer, the enormous gap between the two represents substantial crash risk."

Equity Futures Rise After Oil Rebounds From 12 Year Lows; US Markets Closed

With the US closed today for Martin Luther King Holiday, global risk tone has once again been set entirely by oil, which opened sharply lower at fresh 12 year lows on fears of an Iran oil glut, but has steadily rebounded on the latest OPEC comments, and at last check both WTI and Brent were unchanged trading in the low $29's on muted volume. With Asian markets mixed, European shares swung between gains and losses, while the yen weakened as China stepped up efforts to curb foreign speculation against its currency. Crude oil rose from a 12-year low after the Organization of Petroleum Exporting Countries forecast a decline in supplies from rival producers.

Futures Jump After Friday Drubbing, Despite Brent Sliding To Fresh 11 Year Lows, Spanish Political Uncertainty

In a weekend of very little macro newsflow facilitated by the release of the latest Star Wars sequel, the biggest political and economic event was the Spanish general election which confirmed the end of the PP-PSOE political duopoly at national level.  As a result, there was some early underperformance in SPGBs and initial equity weakness across European stocks, which however was promptly offset and at last check the Stoxx 600 was up 0.4% to 363, with US equity futures up nearly 1% after Friday's oversold drubbing. In other key news, the commodity slide continues with Brent Oil dropping to a fresh 11-year low as futures fell as much as 2.2% in London after a 2.8% drop last week.

Global Stocks, Futures Continue Surge On Lingering Rate Hike Euphoria

Heading into the Fed's first "dovish" rate hike in nearly a decade, the consensus was two-fold: as a result of relentless telegraphing of the Fed's intentions, the hike is priced in, and it will be a "dovish" hike, with the Fed lowering its forecast for the number of hikes over the next year. Consensus was once again wrong on both accounts: first the rate hike was far more hawkish than most had expected (see previous post), and - judging by the surge in Asian, European stocks and US equity futures - the "market" simply is enamored with such hawkish hikes which will soon soak up trillions in liquidity from the financial system.

Has The Fed Ever (Accurately) Predicted A Recession?

In a recent survey not a single major central bank could provide an example of an accurate “a priori” recession forecast. The silence from the Federal Reserve, European Central Bank, BOE, BOJ and the Bank of Canada is deafening.

Previewing The "Most Important Jobs Report Ever" - What Wall Street Expects

There is a high hurdle following October's surprisingly strong gain of 271,000 jobs. On the other hand, Wall Street is confident we would have to see a significantly lower number, somewhere in the 100,000 range or even lower, — and weakness in other parts of the report, such as the unemployment rate, hourly wages and weekly hours — for the FOMC to postpone a rate hike into next year.

From Hope To Nope - Consumer Confidence Crashes To 14-Month Lows

Just three months ago Consumer Confidence was peaking at 8 year highs and everything was awesome. Now, with the biggest miss since March 2009, Consumer Confidence crashed to 90.4 from 99.1. This is the lowest since Septmeber 2014 as the "decline was mainly due to a less favorable view of the job market." Almost every cohort - across age, income, race saw a collapse in confidence though we note low income and under-35s saw the biggest declines as Income Growth expectations plunge to the lowest in 14 months.

Key Economic Events In The Holiday-Shortened Week

It may be a holiday shortened week in the US with Thanksgiving and Black Friday sales on deck (some of which may be starting as soon as Wednesday) but there is a lot of macro data to digest in the next few days.

Futures Rise, Global Stocks Set For Best Week In Six Unfazed By Terrorism Concerns

Futures are modestly higher in early trading having tracked the USDJPY once again almost tick for tick, with the carry trade of choice rising to 123 shortly after Mario Draghi's latest speech pushed the dollar strong initially only to see most gains promptly evaporate against both the Yen and the Euro. European shares are likewise little changed, after gaining earlier, while Asian stocks rise; oil also advanced in early trading only to drop to its lowest overnight level moments ago, a few dimes over $40, with aluminum and copper both posting modest increases.

Consumer Confidence Slides As Low Gas Prices No Longer Lift Sentiment

Despite ongoing low gas prices, a recovery in stocks, and the nationally-advertised unemployment rate remaining low, Consumer Confidence tumbled in October from eight-year highs to three-month lows. Worse still, "hope" slid to its lowest in 3 months as "jobs plentiful" slid notably with fewer jobs and decreasing income.

Futures Firm On Hope Draghi Will Give Green Light To BTFD

After yesterday's dramatic late day market rout catalyzed by the tumble in the biotech sector in general, and Valeant in particular, and foreseen in its entirety by Gartman who went bullish just hours before, this morning US equity futures and European stocks have recouped some losses on the recursive, and traditional, hope that Mario Draghi will say something to push risk higher when he speaks in 2 hours at the ECB's press conference in Malta. And yet, just like Yellen a month ago, Draghi faces the paradox of reflexivity that after years of being ignored, is the "new thing" in town: how does he intervene and demonstrate he is readier than ever to set up stimulus, without panicking investors over euro area’s health.