Here is an update of the Citi Panic/Euphoria index where it literally is going off the chart. It was 1.83 last week and 1.28 in the week prior. This is an unprecedented level of enthusiasm in the history of this index but it will only matter when it matters. Janet Yellen's testimony begins today and it's no surprise that she supports a large amount of …
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Cass Freight/IP/Consumer Confidence
I mentioned the direction of freight costs in the PPI review and here is a chart from Cass Freight in their December report yesterday that reflects freight rates: Cass Implied Freight Rates, January 2009-December 2020 (01’1990=1.00) They also said shipments in December rose 6.7% y/o/y. “The acceleration was partially explained by an easier prior year …
Mfr’g/Retail Sales/PPI
The January NY manufacturing index, the 1st January number out, fell a touch to 3.5 from 4.9 m/o/m. The estimate was 6.0. The internals were pretty mixed. New orders rose while backlogs fell. Inventories were less negative. Employment dropped but the workweek rose. Prices paid jumped by 8.4 pts to 45.5, the highest since September 2018 and those received rose by 5.2 …
Borrow, spend and fair share
What we heard last night was borrow, spend and fair share. With the latter otherwise known as higher taxes. Tha latter is not a surprise as we were told by the Biden side that it was coming but it is still a drag on growth however which way one wants to rationalize it. The borrow part has proven a legacy that lasts forever and the spend is fleeting as it eventually …
Trout, Gretzky, now Mantle
Last month I highlighted the $1.3mm auction price sale of Wayne Gretzky’s rookie card as growing evidence for the desire for ‘hard assets’ (yes, it’s cardboard), along as we see with bitcoin, metals, etc… Today I see that a PSA 9 (10 is gem mint) 1952 Mickey Mantle Topps card was just sold for $5.2mm (h/t JB). The same card went for $2.8mm in 2018 and $283k in …
Claims/Import prices
Initial jobless claims totaled 965k, well above the estimate of 789k and up from 784k last week. Initial claims for PUA rebounded to 284k from 161k last week and vs 310k in the week before. I can only guess that with the extended and expanded benefit payments with the passage of the recent $900b spending bill, many took advantage of it. When the federal government …
Sentiment/China data and its voracious appetite for commodities
Investors Intelligence yesterday said Bulls rose to 63.7 from 60.2 and continues its run of 60+ prints. Bears fell to 16.7 from 17.5 and that 47 pt spread remains extreme. The AAII data is in error as it lists Bulls as being 100% which would be quite extraordinary if true, //www.aaii.com/sentimentsurvey? but it's a mistake. Bottom line, we know sentiment is very …
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Beige Book comments on inflation and wages
On my belief that the direction of inflation might be the most important factor in determining where the prices of stocks and bonds go from here, I include comments on prices and wages in the just released Beige Book. I want to add that inflation/deflation is a process, not an event and that either direction takes time to unfold. While price pressures are …
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Another good auction
The 30 yr bond auction was very good too after the solid 10 yr yesterday. The yield of 1.825% was about 1.5 bps below the when issued. The bid to cover of 2.47 is above the 12 month average of 2.36. And, direct and indirect bidders bought 86% of the offering, above the one year average of 79%. Bottom line, the highest yield since late February brought out the …
Consumer price data
Headline CPI in December rose .4% m/o/m and the core rate was higher by .1% m/o/m. Both are exactly in line with expectations. The headline rate is now up 1.4% y/o/y and 1.6% ex food and energy. The core rate is unchanged with November and the headline increase compares with 1.2% in November. The rise in energy prices is beginning to show up in the data as they rose …
Peter is the Chief Investment Officer at Bleakley Advisory Group and is a CNBC contributor.