Daily Research Updates
Morning Briefings
Expert market analysis delivered every morning. Stay informed with comprehensive research and data-driven insights.
US Earnings Looking Up
(1) Earnings outlook brighter. (2) Recession fears abate as high-yield spread narrows. (3) Net Earnings Revisions Indexes more upbeat in May. (4) Forward revenues and earnings for S&P 500/400/600 either still stalled at record highs or moving to new highs. (5) Thanks again, Fairy Godmother. (6) The Melt-Up scenario is still possible given historically low yields. (7) Yellen is right: Productivity determines standard of living. (8) Productivity slowdown or measurement problem? (9) Real hourly compensation confirms productivity slowdown, but rises to record high.
Shining Metal
(1) Two kinds of people. (2) Gold covers a lot of bases. (3) A hedge against fiat currencies debased by central bankers. (4) Shining again. (5) Gold correlates much better with industrial commodity index than with inflation and the dollar. (6) Professor Copper begs to differ. (7) No oomph in German factory orders and global PMIs. (8) Gold correlates well with TIPS yield and expected inflation. (9) Yellen starring in remake of “Yesterday, Today, and Tomorrow.”
Lake Winnipesaukee
(1) Six investment strategists and a bunch of PMs. (2) Assorted views from Boockvar, Faber, Hickey, and Shilling. (3) Lakeside consensus on income stagnation isn’t supported by data. (4) Angry Americans. (5) May’s weak employment report doesn’t jibe with record job openings, ADP data, and confidence survey. (6) Earned Income Proxy at record high. (7) Yellen should take a hike in the Grand Tetons ’til summer’s end rather than hike rates. (8) Fed Governor Lael Brainard says easy does it on next tightening move after “sobering” employment report. (9) Brexit and China remain Fed concerns.
Globalization & Its Discontented
(1) The theory of everything. (2) Protectionism is a black hole for global economy. (3) The world-renowned Professor Hawking is stumped by Trump and Brexit. (4) Heightened geopolitical tensions. (5) Globalization is transforming. (6) Americans lost jobs to Chinese, who are losing jobs to robots. (7) The real cause of discontent is disruptive technological innovation rather than globalization. (8) The argument against protectionism: Global economy too globalized. (9) Jackie finds that analysts may be overly optimistic about 2017 earnings. (10) Health Care is outperforming.
Good Deflation
(1) Deflation paranoia at the central banks. (2) Yellen says tightening will be very gradual because Fed running out of tools to avoid recession. (3) Eurozone and Japan remain closer to deflation than US despite ongoing easing. (4) China is number-one candidate for classic debt-deflation trap. (5) Lots of good deflation in consumer durables around the world. (6) Services continue to inflate. (7) Health care and rents explain gap between higher CPI and lower PCED inflation rates. (8) Why hasn’t massive yen devaluation worked? (9) ECB can’t seem to prime lending pump. (10) The paradox of refinancing debt at lower rates.
Low-Octane Growth
(1) GDP has six cylinders on demand side and another six on supply side. (2) Some cylinders are sputtering, but GDP unlikely to stall. (3) Still cruising at 2%. (4) Gross Domestic Income continues to exceed GDP. (5) Labor gaining national income share as profit margin falls. (6) Consumer spending is healthy, especially on health care. (7) Capital spending remains weak, while inventories may be bloated. (8) Four regional Fed surveys show weaker economy in May. (9) Wall Street takes a random walk with the Fed. (10) Yellen again: Easy does it on tightening.
Seeking Shelter
(1) Housing springs back in April from March doldrums. (2) Toll reports blockbuster income on more units sold at higher prices. (3) Banks lending more as home equity rises. (4) Lots of demand, not enough supply, pushing prices higher. (5) Lots of renters driving up multi-family starts. (6) Don’t give up on Millennials. (7) Meet Pepper, the robot. (8) Tap yes/no on iPad: Do you want fries with that? (9) Britain’s punk rock choice: Stay or go? (10) Who will be next in line at the EU’s exit door?
Casino Royale
(1) Hard-core gamblers. (2) From Macau to A-shares to rebars and eggs. (3) Professor Copper begs to differ. (4) Not rushing to buy into gold rush. (5) Fed trade: Betting on a stronger dollar as US economy shows strength. (6) Commodity prices inversely correlated with the dollar. (7) Joe reports solid May upward revisions for S&P 500 revenues and earnings. (8) Better times ahead or just not as bad as was expected?
Flatter Curve
(1) Yield curve spread: A leading business-cycle indicator. (2) Spread narrowing, but still positive, as Fed tightens. (3) Spread is throwing Fed a curve. (4) Spread may be going global. (5) A bad omen for S&P 500 revenues and earnings growth. (6) The short end of the yield curve is about the US, while the long end is about the rest of the world. (7) Japan’s M-PMI and exports heading south. (8) Inflation remains near zero in Eurozone. (9) Fed study says Fed officials talk too much. (10) Bullard vs. Gollum.
A Seinfeld Market
(1) Calling on accounts in KC. (2) Institutional investors are mostly neutral. (3) Consensus: Stocks aren’t cheap, and earnings growth is weak. (4) A widely ignored adage. (5) Flat trends in Es with plenty of volatility in P/Es. (6) Some angst about ETFs. (7) Will corporate finance activity continue to be bullish for stocks? (8) FOMC: The difference between “participants” and “members.” (9) SEC sending out reminder letters warning companies to mind the GAAP. (10) “The Man Who Knew Infinity” (+ +).
Mixed Shopping Bag
(1) Minutes and talking Fed heads put June rate hike on the table. (2) From dovish to hawkish. (3) Yellen probably still flying with the doves. (4) “A couple,” “few,” “some,” “several,” and “most” FOMC participants have different views. Yet only one dissented! (5) Brexit and China’s FX were mentioned. (6) Yellen speaks on June 6, the week before next FOMC meeting and a couple days after May jobs report. (7) Jackie discusses the losers and winners in retailing. (8) US over-retailed. (9) Easier to sell clothes washers than clothes.
As the World Turns Older
(1) Growing old is easy; rich not so easy. (2) Aging bad debts. (3) Robots as response to low fertility rate. (4) Capital-spending decisions require obsolescence forecasts. (5) The world’s largest nursing home. (6) Chinese leaders having senior moments. (7) An unnamed authoritative person speaks out in People’s Daily. (8) Xi wants reforms, less capacity, and less debt. (9) China’s banks slam the brakes after record patch-out. (10) Eurozone lending and output flat-lining. (11) Pension funds slammed by record-low interest rates.
Born To Shop
(1) Wages and salaries continue to drive retail sales higher. (2) GDPNow raises Q2 real consumer spending from 3.0% to 3.7%. (3) No stagnation for US consumers: Real retail sales per household up 62% over past 20 years. (4) Consumer sentiment rebounding. (5) Charging to charge it! (6) Government with benefits. (7) Follow the money: Federal government’s biggest job is income redistribution. (8) Great Society getting greater. (9) Private plus public sources of purchasing power packing a wallop. (10) Steve Wynn’s next career.
Money Monster
(1) Horror movie genre. (2) Joe Rosenberg vs. Bernie Sanders. (3) Bernie and Hollywood profit by demonizing Wall Street. (4) George Clooney as Jim Cramer. (5) Glitch or rig? (6) Steve Wynn denounces HFTs’ rigged system. (7) Wynn and Trump are long-time frenemies. (8) Q1 S&P 500 revenues per share up just 0.3% y/y. (9) Earnings per share down 6.0%. (10) Consumers still shopping, but not so much at department stores. (11) E-shopping now accounts for a record 27% of GAFO purchases at stores and online. (12) “Money Monster” (+).
That’s Entertainment
(1) Two wise pessimists. (2) The endgame and the vortex. (3) “Brexit,” the Fed, and The Donald. (4) Central banks keep spoiling endgame party for bears. (5) Prequel: “Apocalypse Not Yet.” (6) When bad things don’t happen, stocks go up. (7) Jackie’s entertaining analysis of the cut-throat media business. (8) S&P 500 Internet Retail has relatively low margins but fast growth. (9) The coming glut of video content. (10) Amazon is disrupting Netfix and YouTube. (11) Everyone wants to be the world’s biggest media company.
Helicopter Money
(1) After the ammo runs out. (2) Friedman’s choppers. (3) Apocalypse Not: Bernanke loves the smell of money in the morning. (4) “Money-Financed Fiscal Programs” is Bernanke’s technical name for “helicopter money.” (5) ECB isn’t ready to take a flier on MFFP. (6) Trump wants to increase maturity of government’s debt in case rates go up. (7) Bond King is endorsing helicopter money to offset robot invasion. (8) Financial titans want more fiscal stimulus. (9) Earnings outlook improving, though forward earnings still flat-lining. (10) A closer look at China’s commodity casino. (11) Nerves of steel needed to trade rebar in China.
Comings & Goings
(1) Stay in it to win it. (2) The short case for a long expansion and a secular bull market. (3) Trump is winning, but will he pivot toward moderation? (4) November-May could be the go-away period this goround. (5) Stocks remain below year-ago record high. (6) Repeat 10 times: “Sheik sacked in shocking shake-up.” (7) Oil: The price may be right. (8) China’s exports and Germany’s orders flat-lining since 2013. (9) BOJ’s policy committee now a debating society.
The Pay Is Good
(1) Friday’s employment report was good. (2) Big increase in our Earned Income Proxy to another record high. (3) Retail and construction employment weak after several strong months. (4) Wage gains still below Yellen’s target, but real hourly compensation is impressive. (5) A few wage oddballs. (6) Confidence and credit suggest consumer spending may soon grow as fast as incomes. (7) The productivity puzzle palace. (8) What is the output and the productivity of a bank, or a hospital, or Amazon? (9) Global PMIs still stagnating. (10) Commodities: China’s latest hot casino. (11) The debt king and the investment legend. (12) “Papa Hemingway in Cuba” (+ +).
Zhengnengliang
(1) Yin vs. Yang. (2) Still staying close to home. (3) The dark side of China. (4) Economics: A dangerous profession. (5) “Positive energy.” (6) Landmining data. (7) Xi and Mao: BFFs. (8) Let’s play “Spot the Spy.” (9) China’s treasonous indicators. (10) The dollar’s descent. (11) Gold shines. (12) Ag shares starting to sprout. (13) Commodity boom more speculative than real? (14) China’s hottest new casino.
Profit Margins: Ups & Downs
(1) Keeping current with current events. (2) Does it make any sense at all that median household income has been flat for 16 years? (3) Census income measure excludes lots of income, especially non-cash government entitlements. (4) Real personal income per household at yet another record high, and up 23% over past 16 years! (5) Late Night Joe’s latest publication focuses on forward profit margins for numerous industries. (6) Lots of bad stuff taken out of GAAP earnings that isn’t all subtracted from operating earnings. (7) Energy margins got drilled, while other sectors still flying high. (8) Tech leads the margin derby.
Seasonal Soft Patch?
(1) Depending on data that can be undependable. (2) Was weak Q1 GDP real or a seasonal adjustment aberration? (3) FOMC, once again, predicting better growth. (4) Consumer goods category accounts for funky GDP pattern. (5) Capital spending and exports look fundamentally weak. (6) Spotting fewer railcar loadings. (7) Truck tonnage: Pedal to the metal. (8) Ship to shore: More inbound than outbound. (9) Boom-Bust Barometer is booming. (10) Treasury data show profit tax receipts flatlining. (11) Subprime: Cars aren’t houses. (12) Railcar loadings of motor vehicles remain upbeat for auto sales.
Inflation Still MIA
(1) Central bankers are overdue to have second thoughts. (2) A heretical idea. (3) Three non-monetary drivers of inflation. (4) CPIs in Eurozone and Japan are comatose. (5) Volcker’s lesson. (6) Good old days for Phillips Curve. (7) Output gap, demand-pull, cost-push, and Janet Yellen. (8) Subdued wage inflation continues to surprise Fed officials. (9) Why aren’t consumers happier given record real incomes and consumption per household? (10) Low investment returns depressing consumers and boosting their saving.
Corporate Urban Legends
(1) FOMC: Global risks downgraded, while slowing US economy upgraded. (2) Some of the NILFs are coming back into the labor force. (3) Five million NILFs want to work. (4) Yellen will hike when there are fewer slackers. (5) Tag team: Bernie attacks Wall Street, while Donald attacks US multinationals. (6) Some urban legends about corporate finance. (7) Fed data show nonfinancial corporations generating cash, issuing bonds, buying back shares, and investing in capital. (8) Jackie reviews Tech’s latest selfdisruptions. (9) Focusing on some winners in Financial sector. (10) Commercial real estate is well funded.
Professor Copper: Speculator?
(1) Copper chart still on downtrend despite recent rally. (2) Big debate: Commodities back in bull market? (3) China is either growing faster again or speculating more again. (4) Speculators link copper and the dollar. (5) Copper highly correlated with expected inflation in 10-year TIPS spread. (6) Global growth remains uninspiring. (7) US and German business indicators flat at high levels. (8) No sign of Chinese economic rebound in Japanese and Korean exports.
Accentuating Some Positives
(1) Round up the usual suspects. (2) Trauma of 2008 remains traumatic. (3) Chinese stocks and currency stop falling thanks to record Q1 borrowing. (4) The Fed remains on hold. (5) Inflationary expectations move a bit higher, while junk bond yields move lower. (6) The current price may be the right price for oil. (7) Rebounding industrial commodity prices confirm global economy continues to grow, while China remains stuck with old normal economy. (8) Emerging economies with dollar debts: the dog that didn’t bite. (9) Central banks turning into world’s biggest hedge funds, financed by their own printing presses. (10) The BOJ should get a seat on the corporate board.