Posted on 05/26/2014 3:43:48 PM PDT by expat_panama
Last week we were going on about the fact that since stock indexes have been flat for so long that we needed to focus on sectors --here are the top ytd sectors (from here) --
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-- and (hat tip to Lurkina.n.Learnin) this link shows a daily 'heat map' of most sectors listed by alpha. We always hear a lot about how the 'big boys' always seem to have more info but imho lack of info is not the problem anymore. These days we're drowning in info and the task we got is making sense of it all.
(mho)
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This is the thread where folks swap ideas on savings and investment --here's a list of popular investing links that freepers have posted here and tomorrow morning we'll go on with our--
Open invitation continues always for idea-input for the thread, this being a joint effort works well. Keywords: financial, WallStreet, stockmarket. |
lol...no inflation? Sounds like Kornball Kenney hasn't been to the grocery store lately.
Of course Obama’s DOL would not lie to us !!! /s
If you have alternate data please provide.
I’m sure you have seen the “up huge this year” charts. Just thought I would show the long run.
Wells Fargo’s take:
Where Is the Growth?
There is clearly more to the economy’s unexpected weak start to 2014 than the harsh winter weather that hit the east coast earlier this year and a reduction in inventory building. While both factors are apparent in the data, we are hard pressed to find much encouragement in this report. Real final sales rose at just a 0.6 percent pace and final sales to private domestic purchasers, our preferred measure of final demand, grew at just a 1.5 percent annual rate, both are 0.1 percentage points less than initially reported. Moreover, the recent shortfall in growth is not a short-term phenomenon. Real GDP growth has averaged just a 2.2 percent pace since the recession ended five years ago, which is about a third short of what was seen in previous recoveries. Final sales to private final domestic purchasers
had been rising closer to its long-term norms before the recent slowdown.
From a technical standpoint, consumer spending was a bright spot in the first quarter, with outlays rising at a seemingly respectable 3.1 percent pace. Most of that growth, however, came from services outlays, which were
driven primarily by the implementation of the Affordable Care Act that boosted payments for health insurance. While this growth does reflect actual activity, the timing reflects the political calendar and not the economy’s underlying momentum. Without the bump in healthcare
outlays, consumer spending would have risen at just a 2.1 percent pace and real GDP would have tumbled at a 2.0 percent pace. That would have been a pause that truly depressed overall economic growth.
There were a few tepid areas of activity. Consumer spending on durable goods rose at a 1.4 percent pace during the quarter, which was actually nearly twice the initial estimate, and spending on nondurable goods rose at a 0.4 percent pace, which was better than the initially reported 0.1 percent gain. Both are meager gains, however, and were helped out by a surge in spending in March, when the weather improved. That rebound did not carry over into April, as retail sales data for that month were discouraging.
Business fixed investment was also disappointing during the quarter. The revised figures show a smaller decline in equipment outlays than first reported, but spending for private nonresidential structures fell at a 7.5 percent pace, compared to an earlier reported 0.2 percent rise.
If there is a saving grace in the GDP data it is that inventories grew much less than first reported, rising by $49 billion instead of the initially reported $87.4 billion. The moderation in inventory building sliced 1.6 percentage points off of first quarter growth, which was nearly a percentage point more than first reported. Inventories are now much better aligned with final
demand and should present less of hurdle to GDP growth going forward. The only question mark is final demand, which appears to still be firmly on the slow growth track.
No WT, just anecdotal personal experience. Another thing I have notices is that manufactures are hiding the inflationary issue by shrinking packages. I wonder how that factors into apples to apples comparisons when it comes to inflation data.
How are CPI prices collected and reviewed?
Each month, BLS data collectors called economic assistants visit or call thousands of retail stores, service establishments, rental units, and doctors' offices, all over the United States, to obtain information on the prices of the thousands of items used to track and measure price changes in the CPI. These economic assistants record the prices of about 80,000 items each month, representing a scientifically selected sample of the prices paid by consumers for goods and services purchased.
During each call or visit, the economic assistant collects price data on a specific good or service that was precisely defined during an earlier visit. If the selected item is available, the economic assistant records its price. If the selected item is no longer available, or if there have been changes in the quality or quantity (for example, eggs sold in packages of ten when they previously were sold by the dozen) of the good or service since the last time prices were collected, the economic assistant selects a new item or records the quality change in the current item.
The recorded information is sent to the national office of BLS, where commodity specialists who have detailed knowledge about the particular goods or services priced review the data. These specialists check the data for accuracy and consistency and make any necessary corrections or adjustments, which can range from an adjustment for a change in the size or quantity of a packaged item to more complex adjustments based upon statistical analysis of the value of an item's features or quality. Thus, commodity specialists strive to prevent changes in the quality of items from affecting the CPI's measurement of price change.
Those are rather dismal statistics.
Like you said earlier, the mandated 0-care implementation related spending halved the GDP growth loss but that spending must have decreased spending in other areas and will likely continue to do so in the coming months and years.
Perhaps things will improve during Recovery Summer 5.0....or are we at RS 6 this year?
“Perhaps things will improve during Recovery Summer 5.0....or are we at RS 6 this year?”
Maybe Recovery Summer will do like the Arab Spring and morph into the Silent Spring and we won’t hear anymore about it.
That answers my earlier question around what happens if the price stays same when say a box of 18 oz of cornflakes at $4.00 suddenly becomes a 16 oz box that costs $4.00 The problem I have now is that this practice is increasingly rampant in all aspects of retail.
When doing the math, this "cornflake like event" in turn means that a new readjusted baseline has to be established with no net impact on inflation stats.
Sneaky way to hide inflation IMO.
I don’t see the deflation that they are going to great extent to ward off anywhere on that chart.
Buying GTAT tomorrow.
No go back an re-read the italicizes part. They make statistical adjustments to the data for exactly the reason you claim.
Look at PCE chain price index which has been running <1% until recently. It’s not “deflation” but it’s disinflation. Without QE it would have been.
That's called shrinkflation. It is rampant in the food industry.
The Bandwagon Effect: This is the one that causes the most pain in a bubble. It's the idea that it's okay to follow the herd because so many other people believe in it. It's irrational because it places its faith in the safety of numbers, while completely disregarding the fundamentals. Without it, a bubble is impossible.
Loss Aversion: People to have a strong preference for avoiding losses over acquiring gains. It's the fear that puts them on the sidelines to stay.
Disposition Effect: This is the tendency for investors to lock in gains and ride out losses. It prompts the sale of shares that are rising, while at the same time keeping investors tied to losers for far too long. It's closely tied to loss aversion, since it's the fear of loss that dominates the thinking.
Outcome Bias: Judging a decision by its outcome rather than the quality of the decision at the time that it was made. This is what makes investors completely disregard a proper decision if it turns out to be a loss.
Sunken Costs Effect: Treating money that has already been spent as more valuable than money that may be spent in the future. It's what helps to build up losses because the investor believes that by selling at a loss he is wasting money. That same money could be put to use elsewhere.
Recency Bias: Weighting recent data more heavily than earlier experiences. It's what freezes investors — especially after a series of losses — even though there may be a much longer string of successes in the past.
Anchoring: This is the tendency for people to rely too heavily on readily available information when making a decision. Investors often base their decisions on information that may be faulty.
Belief in the Law of Small Numbers: This is when investors base their conclusions on a slice of data that is too small. It's the equivalent of making mountains out of molehills, and it blurs reality.
Endowment Effect: People tend to value something more once they own it. As in housing, people tend to overvalue what belongs to them. Of course, this only blinds to them to the real value.
Disconfirmation Bias: This makes people critical of information which contradicts their beliefs while uncritically accepting information that is in line with them. In short, it's a trap whereby people believe what they want to believe.
Post Purchase Rationalization: This when investors persuade themselves through rational argument that a purchase was a good value. Of course, if a decision needs to be rationalized after the fact... it is probably wrong.
You’ve been peeking in my portfolio, haven’t you?
This should make for interesting discussion. The “real” story behind the Wizard of Oz is actually an economic story on the gold standard:
http://www.businessinsider.com/the-wizard-of-oz-and-the-gold-standard-2014-5
Released this morning:
Core PCE, the Fed’s favorite measure of inflation, increased by 0.2% month-over-month in April or 1.4% year-over-year. This was right in line with expectations.
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