Inflation

[waterbottle]

Expectation vs reality. If things aren't as bad as expected, we play ball.

I'm now getting full on FOMO for a SOXL play. Even crypto's back on the menu now.

Expectation was for a positive GDP though, reality was worse... Same for GOOG and MSFT earnings

The FOMO is strong.

Looks like AAPL and AMZN have both beat estimates, albeit by tight margins. BTC has followed (or has it lead?). Most risk assets seem to be approaching some important resistance, meanwhile the FANGs have all reported.

Does the market have any more positive news to report or is it going to be negative earnings from here on?

 

[Value Collector]

actually all they need to do is reduce the velocity of money ( i have no intention of washing my mouth out )

which is counter-intuitive to any government facing re-election ( which survive on INCREASING money velocity so as to increase tax-harvest and kick-backs )

UNFORTUNATELY the higher powers have put bank bail-ins on the table ( so your saving are not completely safe in the banks ) the government continues to spend/borrow recklessly ( so good luck with those bonds )

** Although the various central banks seem to be stuffing round. **

i think the phrase you mean is 'stuffed up ' ( whether intentional or not ) they have got the timing badly wrong , if the US mid-term election results are rejected by a large sector of the population ( either side ) the economy is likely to descend into crisis .. taking out the global reserve currency

Yep, the velocity of money is not something everybody always thinks about, eg it’s not just the total money supply (currency +credit) but also the speed at which that is circulating.

If raising interest rates can cause people to delay purchases because they have to save up a bit more because they can’t afford a loan as large or by now pay later offers dry up, then that will decrease inflationary pressure.

 

[3 hound]

US has now reported a 2nd negative GDP figure.

Good thing that is not how Biden's team define a recession anymore or we would be in a......recession.

 

[over9k]

Meanwhile, intel posts a massive earnings miss and amazon posts a massive earnings beat.

Not sure how much that says about intel specifically though as they've been kind of shite lately.

 

[divs4ever]

Meanwhile, intel posts a massive earnings miss and amazon posts a massive earnings beat.

Not sure how much that says about intel specifically though as they've been kind of shite lately.

am waiting to see how China is going with their home-grown chips , since i am a bit of a Linux fan , that might not be the problem ( Chinese chips ) it seems ( i used to love the old Sun and Alpha architectures )

 

[waterbottle]

Eurozone inflation now 8.9% v. 8.6% expected l

 

[over9k]

All the oil supermajors are reporting before the open, all posting huge earnings beats:



WTI's up ~2.5%.

 

[over9k]

They fight inflation with deflationary measures. Trying to curb spending means inflation tends to not last for long periods.

Although the various central banks seem to be stuffing round.

They're all shitting themselves that's why. Trying not to upset the apple cart any more than it already is.

 

[waterbottle]

German q2 GDP reported at 0% v 0.1% expected lmao. Previous quarter was 0.2%. True stagflation or just stats hiding a recession?

 

[waterbottle]

All the oil supermajors are reporting before the open, all posting huge earnings beats:

View attachment 144721

WTI's up ~2.5%.

Will be interesting to get their opinion on future guidance given most of these profits could be attributed to oil >$100 per barrel...

 

[moXJO]

They're all shitting themselves that's why. Trying not to upset the apple cart any more than it already is.

Seem too frightened before the midterms. It will only make things worse unless stimulus is incoming. Then it's a game of kick the can.

Need to clear the market out so I can grab some bargains.

 

[over9k]

Seem too frightened before the midterms. It will only make things worse unless stimulus is incoming. Then it's a game of kick the can.

Need to clear the market out so I can grab some bargains.

Those were available on the 14th

 

[divs4ever]

German q2 GDP reported at 0% v 0.1% expected lmao. Previous quarter was 0.2%. True stagflation or just stats hiding a recession?

i would normally expect the German data to be precise , but we have an unusual government in unusual times

 

[divs4ever]

Seem too frightened before the midterms. It will only make things worse unless stimulus is incoming. Then it's a game of kick the can.

Need to clear the market out so I can grab some bargains.

the stimulus won't work because they can't ( or won't ) apply MMT intelligently

too late to be frightened about the mid-terms they have done the damage to themselves ( the Republicans are still desperately resisting the return of Trump )

 

[moXJO]

Those were available on the 14th

Grabbed some, along with crypto. Still think US tech is overvalued, its also a mess. I only dribbled into positions though as it still looked high to me. But I was expecting a run. Still going with my "Grind out" theory for now.

Might start shorting some stuff on Monday.
Also lightening some of the profits on crypto.
They are going to need to drop the bomb to contain this at some point.

 

[over9k]

Oil futures and everything else futures into the red as a result.

Demand side.

 

[JohnDe]

View attachment 144816

Oil futures and everything else futures into the red as a result.

Demand side.

Nothing new there, most of China's industry has been in lock down due to their government trying eliminate COVID. No industry = no growth = no economic recovery.

China’s official growth figures are bad enough to be believed
We cross-check the latest numbers

Jul 28th 2022

When china’s Politburo, the 25-member committee that oversees the Communist Party, met this time last year to ponder the economy, China’s rulers seemed quite confident. Their annual growth target was in easy reach and they were keen to crack down further on the country’s overstretched property developers. As The Economist went to press, the Politburo was preparing to meet again. But the economy looks quite different. China’s attempts to stamp out any outbreak of covid-19 have crippled manufacturing intermittently, and consumption more persistently. Distressed developers have stopped working on pre-sold flats—and aggrieved homebuyers have refused to pay their mortgages until construction resumes.

This has put China’s rulers in a pickle. They seem determined to stick to their zero-covid policy. And they would no doubt love to cling to their official gdp growth target of “around 5.5%”. But it has become clear they cannot do both. Unless, of course, they fiddle the growth figures.

That is not beyond them. But there is so far little sign of it. The most recent data showed that the economy grew by only 0.4% in the second quarter, compared with a year earlier. This was not only bad, but worse than expected by private forecasters. In a large teleconference in May, Li Keqiang, China’s prime minister, urged local officials to do more for the economy. But he also cautioned them to seek truth from facts, abiding by statistical regulations.




When he was himself a local official in the north-eastern province of Liaoning, Mr Li sought the truth about the provincial economy from three facts in particular: the electricity it consumed, the cargo travelling on its railways and the amount of loans disbursed by its banks. These indicators, he felt, were more reliable than the official gdp figures. In a similar spirit, John Fernald, Eric Hsu and Mark Spiegel of the Federal Reserve Bank of San Francisco have shown that a judicious combination of eight alternative indicators (including electricity consumption, rail cargo, retail sales and consumer expectations) does a reasonably good job of tracking China’s economic ups and downs. Seven of these indicators (all except consumer confidence) have already been updated for the three months from April to June. They can therefore be used to cross-check the latest official growth figure.

The chart shows our attempt to do that, using much the same method as Mr Fernald and his co-authors. Our calculation is not designed to show if China has systematically overstated gdp growth over the past two decades. But it can detect if reported growth is nearer its underlying trend than it should be, given how far the other seven indicators have strayed from their own usual trajectories. The awful data on retail sales and construction in the second quarter were, for example, far outside the norm. But these shocking figures were partly offset by respectable numbers for rail freight and exports.

In all, these indicators suggest the official growth measure was honest. (They would be consistent with gdp growth that is, if anything, a little higher than the 0.4% reported.) Our approach cannot reveal every kind of statistical skulduggery, but it does suggest China made no extra effort to fudge the figures in the second quarter, despite the unusual ugliness of the time. China’s rulers want to fight the downturn, the virus and doubts about their country’s data. They are doing a better job on the last two counts than on the first. ■

China’s official growth figures are bad enough to be believed

We cross-check the latest numbers

www.economist.com

 

[mullokintyre]

Grabbed some, along with crypto. Still think US tech is overvalued, its also a mess. I only dribbled into positions though as it still looked high to me. But I was expecting a run. Still going with my "Grind out" theory for now.

Might start shorting some stuff on Monday.
Also lightening some of the profits on crypto.
They are going to need to drop the bomb to contain this at some point.

Its is difficult to find a country that i not in a mess right now, just as its difficult to find a currency that one might feel safe in investing right now.
In uncertain times, people will flock to what has worked in the past, the USD.
All the fundamentals in the world cannot overcome the irrationality of the market.
The USD will reign supreme until it doesn't, regardless of the fundamentals, or the charts.
Mick

 

[over9k]

And the jitters return...

Here's a fun little graph:



Buying at the low of the 14th would put almost everything in a very similiar place. Big gap a few days ago to sell BOIL on but I wasn't awake for it (big open and then a plummet all session) because, you know, life.

 

[over9k]

Also:







Food for thought.