'Everyone' knows that the Japanese economy is weakening (apart from Abe and Kuroda obviously), 'everyone' knows that the European economy is tumbling towards another recession, 'most' know that China is really slowing (no matter what the magic of excel enables GDP to be)... and 'everyone' knows that the US economy is the cleanest dirty shirt, will decouple from the rest of the world, and thanks to endless extrapolated dreams, will lead the world to escape velocity. Except... recent macro data suggests otherwise...
The US is hockey-sticking higher as the rest of the world's economies slump... phew thank goodness for that!!
[6]
But... we hate to steal the jam from the market's all-knowing donut, but recent US macro data suggests GDP growth may be slowing here too...
[7]
Without the mirage of American growth - how will equity market valuations ever be achieved...
[8]
So, given the recent jawboning, it seems the Fed is in panic mode to either a) revive the "recovery is on and that's why we're tightening" meme, or b) fold, and retreat back to QE, tail between their legs and admit that's all they have left to juice nominal growth...
Charts: Bloomberg
