The Great Normalization

Oops: Bloomberg reported on Tuesday after the stock market closed, that the Department of Justice (DOJ) had sent Nvidia a subpoena related to a potential antitrust investigation. We speculated that a leak of that information might have caused Tuesday's selloff. On Wednesday after the close, Nvidia denied that it had received a DOJ subpoena. Go figure!

Today's economic data were consistent with our short-term thesis (i.e., "The Great Normalization") and our long-term scenario (i.e., "The Roaring 2020s"). Initial unemployment claims and layoffs remain low. Productivity growth was revised up, while unit labor costs inflation was revised down. August's NM-PMI confirms that the services economy is growing.