Category Archives: Economy

As Good as it Gets; Like 2000 With a TWIST

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Preface from Tim which has nothing to do with the post below: if you missed my mentioning it earlier, SlopeCharts now has text notes and searching (try a search of “Top“, and you see lots of charts from me………obviously). I hope you check it out!

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With the Semiconductor sector below but hailing its all-time highs, a lot of images come to mind; chief among them the 1999-2000 stock market bubble…

In early 2013 we noted a progression that would go on to birth the current economic expansion and stock market boom (of course, I didn’t come close to envisioning the extent of the boom that followed). I’ve belabored it often since, but here’s the short version of the progression yet again…

Fiscal Cliff drama resolves into market relief after Q4 2012 and this occurs right around the time we noted that Semiconductor Fab equipment bookings were ramping up → which projected a ramp in the cyclical Semiconductor industry → which would lead general manufacturing → which projected broader economic firming → which projected improving employment → and with ISM currently booming and the Semi cycle in full swing, voila, we are still on that continuum. (more…)

Effective Market Management: Art & Science

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saul steinberg
From Saul Steinberg’s 1954 drawing ‘The Line’

The notion that there is art involved in interpreting the economy and financial markets is probably heresy to many market participants and probably 99.9% of economists (that .1% guy being the one who’s excluded from the meetings and egghead social gatherings), whether they be right or left leaning (I always find it entertaining to hear right wing and left wing economists duke it out, as I did on NPR yesterday, coming to diametrically opposed conclusions amid the tax reform debate). (more…)

Tax Reform and the ‘Repatriation’ Trade

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The following is the opening segment of the May 14th edition of Notes From the Rabbit Hole

Since the Trump victory we have heard all about the coming fiscal policies that would replace the non-stop and brilliantly evil* monetary policies employed by the Fed since the 2008 market crash. These fiscal policies range from the hair-brained (rust belt factory job repatriation) to the silly (building a border wall in lieu of modernizing security-focused information and surveillance technologies) to the arduous (fixing the Healthcare system) to the sound (well-targeted tax cuts). We’ll get tax cuts, but how well targeted they’ll turn out to be will be debated endlessly and I for one don’t think the trend of the rich getting hyper richer and the poor getting poorer is going to reverse any time soon. For reference, see this post at Biiwii. (more…)

3 Trillion Dollars Now at Risk…and More

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Three Trillion dollars gained in the U.S. markets since the Presidential election in November 2016 are now at risk…and more.

With the recent failings of two attempts by the President to implement temporary travel restrictions from several foreign countries via his executive orders, and the failure of Republicans to reach a consensus on passing a bill that would have repealed and replaced ObamaCare, one has to wonder whether Republicans can, in fact, ever reach agreement on any of President Trump’s economic, fiscal, national security, tax and regulation reform, and immigration reform agenda.

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The U.S. Economy, Post-Payrolls & Pre-FOMC

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This week’s Notes From the Rabbit Hole included a little Payrolls/Wages related economic discussion before moving on to the usual coverage of stock markets, commodities, precious metals, bonds, currencies and related indicators and market internals.  With FOMC on tap there will be more data noise directly ahead, but then I expect markets to smooth out into what is looking like a sensible short and intermediate-term plan.

U.S. Economy

Graphic sources:  St. Louis Fed, BLS, TradingEconomics, Macrotrends & Bespoke Premium

So Payrolls came in a little firmer than expected and interestingly, the manufacturing sectors did some solid hiring. This is an area that is sensitive to coming fiscal policy because it is subject to regulations likely to be repealed (especially environmental, a real fundamental underpinning) and high paying jobs repatriation to U.S. shores (a phony baloney fundamental, at least in large part, in my opinion). In this graph we see that manufacturing job losses had been easing into the election, but job gains have ramped up after the election. All of this on anticipated policy changes? (more…)

“Protection Will Lead to Great Prosperity”

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A slightly modified version of the opening segment of this week’s Notes From the Rabbit Hole, NFTRH 431…

After being mostly off the grid on Friday, I listened to the Trump inauguration speech on Saturday morning. While I have lots of thoughts and opinions, I want to focus on an item where I am qualified; namely my former area of expertise as someone who was in essence told by the media over and over again “you don’t exist”, while the consumerist, financialized and globalized economy flourished. By “you” I of course mean me, an owner of a small American manufacturing business. My area of focus from the speech…

“We’ve made other countries rich while the wealth, strength and confidence of our country has dissipated over the horizon. One by one, the factories shuttered and left our shores with not even a thought about the millions and millions of American workers that were left behind. The wealth of the middle class has been ripped from their homes and then redistributed all across the world. But that is the past and now we are looking only to the future.

We assembled here today are issuing a new decree to be heard in every city, in every foreign capital and in every hall of power. From this day forward a new vision will govern our land. From this day forward it’s going to be ‘America first… America first… America first’! (more…)