Consumer Confidence

Stupid Is As Stupid Does

If you prefer fake news, fake data, and a fake narrative about an improving economy and stock market headed to 30,000, don’t read this fact based, reality check article.

Key Events In The Coming Busy Week: Payrolls; FOMC Minutes; Trump Meets Xi

The key economic releases in the US this week are ISM manufacturing on Monday, ISM non-manufacturing on Wednesday, and the employment report on Friday. The minutes of the March FOMC meeting will be released on Wednesday, while several Fed officials are scheduled to speak this week. The meeting between Trump and Xi set for Thursday and Friday at Mar-A-Lago will likely attract significant attention.

Hedge Fund CIO: "What If The 'Trump Earnings Surge' Was Just An Illusion?"

"Why is the yield curve flattening? Why is loan demand declining? Why is consumer confidence at historic highs while retailer stocks are getting demolished? What happens if he can’t cut corporate taxes? What happens if we’ve recalibrated earnings to a future that was just an illusion?"

High Number Of Consumers See Stock Rally As "Sure Thing"

Gathering bullishness is great for stocks and the prospects for a rally. Once that bullishness hits an extreme, however. the prospects change. Based on the UM Survey Of Consumers, sentiment towards stocks has reached an extreme. And based on that alone, expectations for the next 12 months should be tempered.

Margin Debt Hits New Record High But Analysts Say "Don’t Worry"

"This isn’t a signal to me that markets are reaching an exuberant level like they did in the 1920s or 1990s, when speculation was rampant.  What our clients are doing is borrowing against the portfolios because interest rates are so low. They’re not leveraging up because they see the market exploding to the upside; they’re using leverage because they can pay it off at any time.”

Are Markets Overlooking A Clear & Present Danger?

Economic cycles do not last indefinitely. While fiscal and monetary policies can extend cycles by “pulling forward” future consumption, such actions create an eventual “void” that cannot be filled. In fact, there is mounting evidence the “event horizon” may have been reached as seen through the lens of auto sales.

Frontrunning: March 29

  • British PM May fires starting gun on Brexit (Reuters); Britain Starts ‘Historic’ Brexit Process (BBG)
  • Firms stack up Brexit warnings as May triggers divorce talks (Reuters)
  • Huge range of sterling forecasts clouds horizon for Brexit talks (Reuters)
  • Merger of Deutsche Börse and LSE Blocked by EU Regulator (WSJ)
  • After crippling cost overruns, Toshiba's Westinghouse files for bankruptcy (Reuters)

Global Stocks, S&P Futures Little Changed On Brexit Day

Brexit day has finally arrived, and despite this major "risk event", European and Asian stocks are trading mixed, while S&P futures are just fractionally lower as a bounce on optimism over the American economy appears to have fizzled and President Trump continues to struggle to pass his legislative agenda. The pound first dipped then rose as the U.K. is set to begin its life outside the EU. 

And Now Fake Consumer Confidence Too: Gallup Says Confidence In The Economy "Tumbled"

"Americans' confidence in the U.S. economy tumbled along with the Dow Jones industrial average last week. Though still in positive territory, Gallup's U.S. Economic Confidence Index (ECI) dropped six points to a score of +5 for the week ending March 26. This is the lowest weekly average since the presidential election in November." - Gallup