The Producer Price Index just came in, and it is absolutely ice cold.
This has vaulted equities higher by about half to three-quarters of a percent. Nothing earth-shaking, but definitely helping the /ES inch toward major resistance at the red line. It seems that folks are fetishizing a deflationary environment, which is precisely the last thing the Fed wants to see materialize. Yet, here it comes.
In doing so, the VIX has collapsed over the past week from nearly 70 to the TEENs.
Let’s just say this – – if by some miracle today, Tuesday, the market actually declines by day’s end, you can safely assume that the aforementioned fetishization is kaput, as the market realizes that the economy is absolutely headed for the dumpster.
