The big news in the UMich data was not inflation expectations. Look at what people are saying about the jobs market! Expected change in unemployment worst since the 2008 recession. No one is asking for a raise in this environment.
RenMac: Renaissance Macro Research
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RenMac: Renaissance Macro Research
@RenMacLLC
Serving professional money managers. Tweets are an exchange of ideas not investment advice. Life is short, if you're a jerk, you'll be unceremoniously blocked.
- This is not a close call. The unemployment rate is climbing & payroll growth is slowing. Conditions in the labor market are cooling off. The trade-offs for the Fed have shifted. If they don't cut this month, they ought to make a strong signal a cut is coming in September.
- The Fed revising down growth, revising up unemployment and revising up inflation and also pushing up the path of interest rates. This is a recipe for recession.
- Seeing plenty of short-exposure....more than COVID. $SPX
- Sell in May and go away is wrong, and it's been wrong for a long-time on $SPX. Might be good for the golf game, but sell in July is a better market call. In Presidential election years, Q2 is much different path than traditional path.
- Consumer sentiment is imploding. Importantly, consumers see a negative supply shock. Inflation expectations have jumped while employment expectations have plunged. Not great, Bob!
- As mentioned on this week's pod. The % of consumers expecting stock prices to DECLINE is at its lowest level in 15yrs. It's contrarian in nature. In the spring, the % expecting stocks prices to decline was highest ever... as predicted $SPX ripped.
- Replying to @RenMacLLCSo far this year, AI capex, which we define as information processing equipment plus software has added more to GDP growth than consumers' spending.
- This feels like lights out for US housing.The average 30-year fixed mortgage rate today: 7.15% Same day last year: 6.64% ---- Spread: 257 bps 10-year Treasury yield: 4.58%
- Economy is 'jumping' into a recession, says Renaissance Macro's Neil Dutta
- Waller looks vindicated.
- Signs that labor market conditions continue to cool off. In July, the Indeed Wage Growth Tracker slowed to 2.4% in July, the weakest in five years. Wage growth in job postings tends to lead actual wage and salary growth.
- Core PCE inflation is up 1.87% at an annual rate over the last six months as of November. Between used car & truck prices and housing rents, there is room for inflation to remain benign. We continue to see the Fed cutting its policy rate in March.
