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i have seen so many definitions change in the last 3 years , i wasn't sure i was up-to-date
thanks
thanks
over9k
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I find that interview interesting, at least the view till 2025
probably because i am already a converted.
probably because i am already a converted.
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Online businesses were always going to suffer once mandatory lockdowns became a thing of the past...
over9k
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Of course. But bricks & mortar retail's been in structural decline for quite some time. Etail has been pasting retail for years, and yet we see etail getting slammed as well.
Point is, if etail's taking a hit then retail's going to get an even bigger one.
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actually i was thinking retail property REITs were going to be the first squeezed hard , and maybe the office REITs not far behind them , and then the ( B&M ) retailers that survived the last two years
well etail and retail both rely on money/credit in the customers wallet , either credit expands or buying slows because NORMALLY wages lag inflation
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Well, retailers claiming low supply is probably just part of a conspiracy theory. Numbers say otherwise...
tradingeconomics.com
Hmmmm the plot thickens
www.google.com
United States Retail Inventories Ex Autos
Retail Inventories Ex Autos in the United States decreased to 0.40 percent in August from 0.50 percent in July of 2024. This page includes a chart with historical data for the United States Retail Inventories Ex Autos.
tradingeconomics.com
Hmmmm the plot thickens
Target posts a stunning drop in profit. Stock plunges
Target's earnings didn't hit the mark. Far from it.
www.google.com
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there is enough data from assorted sources showing bottlenecks in supply-chains ( in general ) now has THAT company found a work-around , like reports of folks travelling to the ( computer ) chip factory filling up a couple of suitcases and flying back
obviously that won't work for mine trucks
obviously that won't work for mine trucks
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I have a current affairs style theory:
all the shipping containers have been removed from the shipping trade by western hipsters using them to build Airbnb tiny houses to rent to Ukrainian refugees.
Blame Putin!
all the shipping containers have been removed from the shipping trade by western hipsters using them to build Airbnb tiny houses to rent to Ukrainian refugees.
Blame Putin!
Mohammed Hazabig'un
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Just read it's also the length of time that the Yield Curve is inverted for that also counts.
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China's stimulus tops $7 trillion as Covid-19-zero batters economy
Even more could be spent if the economy fails to pick up from its current funk. Read more at straitstimes.com.
Move over St. Jerome, St. Gang is here...
Interesting to note that China had been tightening earlier than Western banks. Regardless, devaluing with Yuan would help to keep inflation at bay in Western countries. I suppose this stimulus would also address supply issues...
over9k
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"So, in these past four very rough months, we have started to see the mean-reversion process take hold when it comes to the multiple now contracting. As it should with the Fed tightening policy and threatening to do much more. In fact, if the Fed does all it is pledging to do, with higher rates and a shrinking balance sheet, the de facto tightening will come to around 400 basis points. This compares to 180 basis points in 2018 and 315 basis points for the entire 2015-2018 cycle—85 basis points more this time and all lumped into one year! This compares to 175 basis points of rate hikes in 1999-2000 (ahead of that recession), 300 basis points in 1994, and 313 basis points in 1988-89 (ahead of that recession). You have to go back to the early 1980s to see the last time the Fed got so aggressive in such a short timeframe.
How apropos. At the semi-annual congressional testimony in early March, in response to a comment from Sen. Richard Shelby (R, Ala.), Jay Powell responded with his view that Paul Volcker was the greatest economic public servant of all time. Well, Volcker is revered today for slaying the inflation dragon, but in the early 1980s he was reviled for creating the conditions for back-to-back recessions and a huge bear market. People today ask where the “Powell put” is. Rest assured, the “Volcker put” was an 8x multiple in August 1982. Trust me—you don’t want to do the math on that, no matter what your earnings forecast is today.
Earnings is the next shoe to drop. When it does, no one will be debating about whether or not we are in a bear market. There has never been a GDP recession without there being an earnings recession, full stop. Everyone dismisses the -1.4% annualized real GDP contraction in the first quarter as an aberration, but I am not seeing any sort of recovery in the current quarter. In fact, the monthly data has so much negative forward momentum that the handoff to the second quarter is -1%. Monthly GDP in real terms contracted 0.4% in March and was flat or down in each of the past five months. During this time span, from October to March, the “resilient” U.S. economy has declined outright at a 2.4% annual rate. And in the past, this has only happened in National Bureau of Economic Research-defined recessions. The April nonfarm payroll report appeared strong, but beneath the surface, full-time jobs plunged the most since April 2020 and small-business employment, always a reliable indicator of turning points in the cycle, has declined more than 100,000 in the past three months.
Besides, “inflation” has put real disposable personal income, close to 80% of the economy, into a recession of its own, contracting in six of the past seven months, and at a -4.5% annual rate. As sure as night follows day, consumer spending will follow suit. The Fed will do its best to reverse the situation, but the medicine won’t be tasty, as the inflation shock is replaced by an interest rate shock. The mortgage and housing markets are already responding in kind.
The stock market has done a lot of work to price in a recession, but is so far discounting one-in-three odds. More to do still. The inflation shock is largely exogenous. What few talk about is how fiscal-policy contraction alone is going to help take care of the demand side by the end of the year. Is it well-understood that if items like food and energy inflation don’t come down, then the Fed, in its quest to return to 2% inflation, would have to drive a big hole in the other 80% of the pricing pie? The Fed would have to create the demand conditions that would bring the core inflation rate to -1.8%—which has never happened before! To get to 2% inflation, with the supply curve so inelastic, would require a recession that would take real GDP down by more than 3% and the unemployment rate back toward 7%. This is the sort of demand destruction that would be needed for the Fed to win the battle against this supply side inflation, caused principally by the never-ending Chinese lockdowns and the Russian-waged war in Ukraine.
We ran models to see how financial conditions have to tighten if the Fed is, indeed, serious about its 2% inflation target. You won’t like the answer if you are still trading risk assets from the long side: 700 basis point spreads on high yield bonds (another 250 basis points to go) and call it 3,100 on the S&P 500 (another 20% downside). This makes perfect sense since the S&P 500, historically, has gone down 30% in recession bear markets. The first 10% before the recession as the downturn gets discounted, and then the next 20% through the first three-quarters of the recession. Keep in mind, however, that there is wide dispersion around that “average.” We have to acknowledge that we’re entering a prolonged period of heightened uncertainty between the ongoing pandemic and the war abroad, together with this very hawkish Fed. The earnings recession could bump against a further compression in the market multiple. So, my hope is that the 3,100 “trough” doesn’t end up proving to be overly optimistic. Yes, you read that right.
Finally, we have to play the probabilities. The Fed has embarked on 14 tightening cycles since 1950, and 11 landed the economy in a recession and the stock market in a bear phase. That’s a nearly 80% probability right there.
We can certainly hope for a “soft landing” this time around, but in my 35 years in this business, hope is rarely an effective investment strategy. The backdrop is one of a peak in the liquidity and economic cycle, and what follows is the natural expunging of the excesses (meme stocks, cryptocurrencies, speculative Nasdaq 100, even residential real estate, which is in a huge price bubble of its own) and then… the rebirth. There is no sense in being in denial. This is all part of the cycle, and the turning point was turned in several months ago".
https://www.barrons.com/articles/th...m-and-defensive-51652454842?mod=hp_LEAD_1_B_5
We've seen massive earnings misses time and time and time again over the past few days and look at the result. You want to know how far along we are in this cycle, well, that's it.
Also take note of the fact that this is a SUPPLY side problem and the only thing the fed can do is reduce the demand side. Hence, as I keep trying to point out, it's not inflation we're in, it's stagflation.
Upping interest rates will only make capital more difficult to come by and therefore increases in supply (aka drilling) even less likely.
Hence why I keep mentioning the very simple damned if they do, damned if they don't reality of this. Yellen's even just gone on record, literally just today, as saying that they will not even begin to reconsider the 2% inflation target.
My two biggest positions are in FNGD and NRGU.
How apropos. At the semi-annual congressional testimony in early March, in response to a comment from Sen. Richard Shelby (R, Ala.), Jay Powell responded with his view that Paul Volcker was the greatest economic public servant of all time. Well, Volcker is revered today for slaying the inflation dragon, but in the early 1980s he was reviled for creating the conditions for back-to-back recessions and a huge bear market. People today ask where the “Powell put” is. Rest assured, the “Volcker put” was an 8x multiple in August 1982. Trust me—you don’t want to do the math on that, no matter what your earnings forecast is today.
Earnings is the next shoe to drop. When it does, no one will be debating about whether or not we are in a bear market. There has never been a GDP recession without there being an earnings recession, full stop. Everyone dismisses the -1.4% annualized real GDP contraction in the first quarter as an aberration, but I am not seeing any sort of recovery in the current quarter. In fact, the monthly data has so much negative forward momentum that the handoff to the second quarter is -1%. Monthly GDP in real terms contracted 0.4% in March and was flat or down in each of the past five months. During this time span, from October to March, the “resilient” U.S. economy has declined outright at a 2.4% annual rate. And in the past, this has only happened in National Bureau of Economic Research-defined recessions. The April nonfarm payroll report appeared strong, but beneath the surface, full-time jobs plunged the most since April 2020 and small-business employment, always a reliable indicator of turning points in the cycle, has declined more than 100,000 in the past three months.
Besides, “inflation” has put real disposable personal income, close to 80% of the economy, into a recession of its own, contracting in six of the past seven months, and at a -4.5% annual rate. As sure as night follows day, consumer spending will follow suit. The Fed will do its best to reverse the situation, but the medicine won’t be tasty, as the inflation shock is replaced by an interest rate shock. The mortgage and housing markets are already responding in kind.
The stock market has done a lot of work to price in a recession, but is so far discounting one-in-three odds. More to do still. The inflation shock is largely exogenous. What few talk about is how fiscal-policy contraction alone is going to help take care of the demand side by the end of the year. Is it well-understood that if items like food and energy inflation don’t come down, then the Fed, in its quest to return to 2% inflation, would have to drive a big hole in the other 80% of the pricing pie? The Fed would have to create the demand conditions that would bring the core inflation rate to -1.8%—which has never happened before! To get to 2% inflation, with the supply curve so inelastic, would require a recession that would take real GDP down by more than 3% and the unemployment rate back toward 7%. This is the sort of demand destruction that would be needed for the Fed to win the battle against this supply side inflation, caused principally by the never-ending Chinese lockdowns and the Russian-waged war in Ukraine.
We ran models to see how financial conditions have to tighten if the Fed is, indeed, serious about its 2% inflation target. You won’t like the answer if you are still trading risk assets from the long side: 700 basis point spreads on high yield bonds (another 250 basis points to go) and call it 3,100 on the S&P 500 (another 20% downside). This makes perfect sense since the S&P 500, historically, has gone down 30% in recession bear markets. The first 10% before the recession as the downturn gets discounted, and then the next 20% through the first three-quarters of the recession. Keep in mind, however, that there is wide dispersion around that “average.” We have to acknowledge that we’re entering a prolonged period of heightened uncertainty between the ongoing pandemic and the war abroad, together with this very hawkish Fed. The earnings recession could bump against a further compression in the market multiple. So, my hope is that the 3,100 “trough” doesn’t end up proving to be overly optimistic. Yes, you read that right.
Finally, we have to play the probabilities. The Fed has embarked on 14 tightening cycles since 1950, and 11 landed the economy in a recession and the stock market in a bear phase. That’s a nearly 80% probability right there.
We can certainly hope for a “soft landing” this time around, but in my 35 years in this business, hope is rarely an effective investment strategy. The backdrop is one of a peak in the liquidity and economic cycle, and what follows is the natural expunging of the excesses (meme stocks, cryptocurrencies, speculative Nasdaq 100, even residential real estate, which is in a huge price bubble of its own) and then… the rebirth. There is no sense in being in denial. This is all part of the cycle, and the turning point was turned in several months ago".
https://www.barrons.com/articles/th...m-and-defensive-51652454842?mod=hp_LEAD_1_B_5
We've seen massive earnings misses time and time and time again over the past few days and look at the result. You want to know how far along we are in this cycle, well, that's it.
Also take note of the fact that this is a SUPPLY side problem and the only thing the fed can do is reduce the demand side. Hence, as I keep trying to point out, it's not inflation we're in, it's stagflation.
Upping interest rates will only make capital more difficult to come by and therefore increases in supply (aka drilling) even less likely.
Hence why I keep mentioning the very simple damned if they do, damned if they don't reality of this. Yellen's even just gone on record, literally just today, as saying that they will not even begin to reconsider the 2% inflation target.
My two biggest positions are in FNGD and NRGU.
Last edited:
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hope is a fantastic management strategy , as soon as your hopes are realized you take profit real frickin' quick ( no going out to party overnight and stuff )
( LOL )
( LOL )
Go away with that rubbish.
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i have made the mistake of taking too long to lock in that profit , a few times ( sometimes you have only minutes to act )
( after the profit-take there is plenty of time for autopsies , reviews and reinvestment strategies )
( after the profit-take there is plenty of time for autopsies , reviews and reinvestment strategies )
over9k
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"We think the fed is going to realise that the only thing they're reducing is growth".
BINGO. They cannot bring this inflation down without plunging us into recession. This IS stagflation - it's either high inflation or recession, those are the options, and Yellen's gone on record saying they won't even consider raising their 2% inflation target. Ergo, it's recession.
Think about the last time this shift occurred so rapidly
Least financially literate person here but even blind Freddy could have seen printing trillions of dollars for COVID relief and then billions more into Ukraine + sanctions was never going to end well for the average Joe.View attachment 142115
"We think the fed is going to realise that the only thing they're reducing is growth".
BINGO. They cannot bring this inflation down without plunging us into recession. This IS stagflation - it's either high inflation or recession, those are the options, and Yellen's gone on record saying they won't even consider raising their 2% inflation target. Ergo, it's recession.
View attachment 142116
Think about the last time this shift occurred so rapidly
over9k
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To be fair, about half of it is thanks to the sanctions. Without them, we'd be sitting at a much more moderate official stat of about 5ish% rather than the 8-9% we see now.
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Agreed, transitory inflation is real
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