Ho! Ho! Ho!

Check out the accompanying pdf and chart collection. Executive Summary: The stock market’s Santa Claus rally has been turbocharged by a rallying bond market, subsiding inflation, lower oil and gasoline prices—in turn fueling consumers’ purchasing power—diminished fear of the Fed, and China’s economic weakness, which lowers the prices Americans pay for goods imported from there. … Jamie Dimon is right to warn that geopolitical dangers are great, but we don’t ascribe to his view that inflation remains troublesome, the Fed might tighten more, and the consumer’s strength likely isn’t sustainable. We think the economic evidence suggest otherwise on each score. … More good news: The sticky services inflation rates that have concerned the Fed are coming unstuck. ... Dr. Ed’s movie review: “The Holdovers” (+).