Posted on 01/18/2023 8:26:05 AM PST by Kaiser8408a
Soft landing for the US economy? It is looking less and less likely. The bond market (10-year Treasury yield) just shed -14.1 basis points. As I always told my investments students, any 10 basis point shift in the 10-year Treasury yield is significant.
Let’s start wit the US business leaders survey of current conditions. It just crashed to -21.4
Then we have US industrial production, down -0.7% in December. And is up only 1.65% year-over-year as M2 Money growth stalls.
Capacity Utilization plunged more than expected to 78.7% (79.5% exp).
Biden claiming the US economy is strong is pure Fantasy Island.
(Excerpt) Read more at confoundedinterest.net ...
I haven’t understood the “bad news is good” reaction by stocks for the past few months... the Fed isn’t coming to the rescue until the economy has broken... and that can’t (at least historically hasn’t) been good for stocks. The bond market is pricing in a recession, and between the stock and bond markets the bond market is usually smarter.
Looking good, everything going just as it should.
Everyone said there would be no free lunch, now they are upset as the bill for lunch shows up.
Lunch, only because we can no longer afford breakfast.
Perhaps you remember around 2007 or so talking heads on financial networks kept babbling about the “soft landing” the economy would experience...the “experts” said so.
I think we are in for an old fashioned soul crushing recession.
Barron’s has a positive take: encouraging inflation data (in)action by the Bank of Japan. CNBC talking heads this morning were saying chancing of a soft landing are increasing.
That might get the Repubs back in power. To be kicked back out again as soon as they make the recovery.
Fixed it
Hi.
Welcome to FR.
Stagflation my man. Jimmah Carter 2.0
I hope I’m wrong.
5.56mm
This situation is nothing like 2007. Much more like 1969. The reforms instituted after 2007 changed banking for the better.
Go to the FDIC site, you can look at the books of any bank, you can see right where they are at financially. And that info is audited for accuracy.
People longing for a big crash are in for a big disappointment. So they will simply insist it’s a big crash no matter what happens.
Economics are not my strong suit, but I understand that ESG investment is intended to destroy the US energy industry and with that, the whole US market. What I don’t understand is how they can convince investors to take actions that are counter to their own interests.
If people would just read, Peter Schweizer’s book, Red Handed, just the segment about Larry Fink, and Black Rock should be enough to do it.
ESG funds are already feeling the blowback as hedge funds are lowering exposure to them. The higher the ESG rating, the larger the blowback.
In the end money always wins over fantasy.
At FR, it’s all depression all the time. Except for the Fake Boom periods. It’s gets boring but that’s the landscape here. I prefer reality.
The indicators are all over the place as are the interpretations of what they mean. These interpretations are often predicated on the single data point and past history.
When you look at them collectively we appear to be in some form of economic tachycardia or arrhythmia. It is bizarre. Indexes that usually follow one another are not and indexes that we have not really paid much attention to in the past decades are suddenly showing big change.
The classicists point to many of these indicators and forecast stagflation. You (and they) might be right. However, we have NEVER entered a period of economic turmoil with this amount of debt at all levels of our nation (Uncle Sam to Uncle Bob on Main Street and everything in between).
That debt, and the certain money printing it will cause, is going to have a vote in how this plays out and it won’t be pretty no matter what we call it.
Yes, I do... I was (and still am) managing portfolios for clients. If you look at unemployment vs stock prices, historically super-low unemployment is “as-good-as-it-gets” for stocks, and prices usually decline as unemployment rises. If the bond market is right, and a recession is coming, this will either be the first recession in which equity prices don’t decline and/or unemployment doesn’t rise.
YoY
While you are correct and this place tends to be a bear market, I don’t have much reason for optimism after the last few years and our “leadership”.
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