QuickTakes

The most concise analysis of the key variables driving the global economy and financial markets.

Short-form takes on current market events.

The Spreading War In The Middle East

Ever since Hamas attacked Israel on October 7, 2023, we’ve warned that the latest war in the Middle East between these arch enemies could be protracted and spread to the rest of the region. On October 10, we wrote:

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PPI Not As Hot As CPI

Today’s PPI report threw some cold water on yesterday’s hotter-than-expected CPI. Our opinion is that the Fed won’t be lowering interest rates this year because the economy and labor market will remain strong. Yesterday’s CPI confirmed our conclusion based

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The Last Mile

Will the Fed start raising the federal funds rate again? We expect to be hearing this question more often following today’s hotter-than-expected CPI inflation report. The previous two reports, for January and February, were also hotter than expected. We don’t think

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Max On The Market

Max is getting ready for the eclipse on Monday. He regularly appears in Dr Ed’s weekly webcasts on Mondays. Max has correctly predicted the direction of the stock market over the past two weeks. Replays of our Monday webcasts

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Market Call: $100 Oil, $3000 Gold?

Will the current decade turn out to be like the 1920s, 1970s, or 1990s? We are still assigning subjective probabilities of 60% to the Roaring 2020s (like the 1920s), 20% to a second peak in inflation (as occurred during the

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The Economic Week Ahead: April 8–12

This week’s economic releases will feature some key inflation numbers. The March headline CPI (Wed) and PPI (Mar) will get a boost from higher gasoline prices. Their core inflation rates should continue to moderate. The week starts with the FRB-NY survey

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Loose Fed Lips Sink Stocks

We are in the same camp as Federal Reserve Bank of Minneapolis President Neel Kashkari. On March 6, he said, “If we have a run rate that’s very attractive, people have jobs, businesses are doing well, inflation is coming back

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‘Knock On Wood’

Fed Chair Jerome Powell spoke at Stanford University today about the economy and monetary policy. He said, “I think we’ve gotten to what is, knock on wood, a pretty good place.” He added, “We’re using our tools to try

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Rolling Recoveries In Manufacturing & Retailing

The rolling recessions in manufacturing and retailing are turning into rolling recoveries. That’s our conclusion based on today’s relatively solid manufacturing purchasing managers report for March. The M-PMI rose to 50.3, the first reading above 50.0 since September 2022

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The Economic Week Ahead: April 1-5

The first week of the month is always jampacked with economic indicators. In addition, at least one member of the Federal Open Mouth Committee will be speaking every day. The economic indicators should confirm that the economy remains resilient

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Market Call: Fed Choir All On Same Page

Fed Chair Jerome Powell spoke on Friday at an event at the San Francisco Fed. He repeated what other Fed officials have been saying recently. Solid economic growth gives the Fed “the chance to just be a little more

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Sweet Economic Indicators

Today’s batch of economic indicators was mostly sweet. Q4’s real GDP was revised from 3.2% to 3.4% (chart). The Atlanta Fed GDPNow model is projecting 2.1% for Q1-2024. Consumer spending was revised up from 3.0% to 3.3% despite fears

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‘There’s Still No Rush’

So said Federal Reserve Governor Christopher Waller this evening at the Economic Club of New York in a speech titled “There’s Still No Rush.” He noted that the latest inflation figures were “disappointing” and that the economy and labor market remain

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The Man With The Midas Touch

It was a slow day on Wall Street for almost everybody except for Donald J Trump. It was make-DJT-rich-again day. His social media company jumped more than 50% immediately after it began public trading under the ticker DJT this morning, making

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Performance Derby

The stock market rally should continue to broaden as investors realize that the MegaCap-8 are not bulletproof. Tesla has competitors such as China’s BYD , which on Monday lowered the starting price of its Seal electric sedan to just

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Market Call: The Fed Put Is Back

Last week, the FOMC released its latest quarterly Summary of Economic Projections (SEP) for March. Compared to December’s SEP, the committee’s participants raised their 2024 median forecasts for real GDP (from 1.4% to 2.1%) and for the core PCED

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The Economic Week Ahead: March 25–29

The most important economic indicator for the week ahead will be February’s PCED inflation rate, which comes out on Friday. The Cleveland Fed’s Inflation Nowcast shows the headline and core rates rising 0.4% and 0.3% m/m and 2.5% and 2.8%

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Moon Shot

The S&P 500 rose to yet another record high today, closing at 5241.53 (chart). We wrote the following last year on July 19 in our Morning Briefing: “The S&P 500 is now almost at [our yearend target of] 4600. It closed

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Powell & Co. Remain Dovish

Powell & Co. were more dovish today than we (and stock investors) expected. The FOMC’s Summary of Economic Projections (SEP) still implied three 25bps cuts in the federal funds rate (FFR) this year (table). That’s the same projection as in

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Stock Market Has Discounted Lots Of Good News

Nvidia was up a measly 1% today despite the exciting presentation, after Monday’s close, by CEO Jensen Huang about the company’s future in the AI ecosystem (chart). He announced a new generation of GPU chips and software for running

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The S&P 500/400/600 Performance Derby

The S&P 500 LargeCap stock price index is up 44.0% since the end of the latest bear market on October 12, 2022. The S&P 400 MidCap and S&P 600 SmallCap are up 29.5% and 17.8% since then. The S&P

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The Economic Week Ahead: March 18–22

While Nvidia’s AI lovefest during the first three days of this week and the FOMC meeting on Tuesday and Wednesday might move the stock market, it’s a quiet week for economic indicators. It will be interesting to see whether the Philly Fed’s regional business survey

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The Pause That Refreshes Spooks Investors

The stock market’s vertical momentum rally that started on October 27, 2023 seems to be losing some of its momentum. Maybe. That’s OK with us. We would rather see our 5400 S&P 500 target achieved by year-end than by

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Yikes: Everyone is Bullish!

During the week of October 11, 2022, the Investors Intelligence Bull/Bear Ratio (BBR) fell to a cyclical low of 0.57 (chart). The previous bear market bottomed the next day on October 12, 2022. The BBR reading back then was

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Core CPI Continues To Moderate

February’s CPI was a touch hotter than expected. That didn’t cool stock investor’s exuberance for AI-related stocks. Nvidia was up more than 7% today, erasing nearly all of the drop over the previous two days. The company will be

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Broadening Bull

The S&P 500 market-weighted stock price index is up 43.2% since the current bull market started on October 12, 2022 (chart). The equal-weighted version of the index—with the 500 stocks assigned an equivalent weighting regardless of their market capitalization, allowing us

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Market Call: The Front-Cover Curse Already?

The front cover of this week’s Barron’s shows the horns of a bull apparently charging through a big white sheet of paper. Only the horns are visible in the picture. Usually, a bull appearing on the front cover of a major

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The Economic Week Ahead: March 11–15

The coming week starts with a couple of key inflation indicators. Both were probably boosted by rising gasoline prices. The retail pump price is up 9.1% since the last week of January. This bounce might have boosted February’s reading

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