A (Not So) Happy Thanksgiving For U.S. Data

Takeaway: We're sticking with our reality-based recession call for 2016.

A (Not So) Happy Thanksgiving For U.S. Data - turkey

 

In a note to subscribers this morning, Hedgeye CEO Keith McCullough highlighted a few recent market developments that he's watching today: 

 

"It was another strong bounce-back morning for the greenback +0.4% vs. the Euro is taking the commodity crash right back to the woodshed – Oil -1.5% post yesterday’s +2.8% bounce (which helped Energy stocks lead the US equity rally off the lows intraday) - #Deflation Risk = On."

 

A (Not So) Happy Thanksgiving For U.S. Data - usd greenshoot

 

This evolving story has everything to do with monetary policy as the Yellen Fed looks to tighten in December while the ECB and Draghi ease. It's no surprise that the dollar is strengthening.

  

In other central planning news, the gap between 10yr and 2yr U.S. Treasuries is closing on speculation of a December rate hike. More analysis from McCullough:


"The yield curve continues to compress as the US economic data slows (Corporate profits -3.2% Q3 and Consumer Confidence tanked to 90.4) – this week the 10s/2s spread has compressed another 6bps to +129bps as credit trades like 1,000 pounds of stale pumpkin in a 100lb bag."

 

That further compression of the yield curve came after last week's -9bps.

 

Then again, the Fed apparently doesn't seem too concerned about raising rates into a slowdown. Here's the most recent spate of #GrowthSlowing data. Note the January peaks. 

 

Consumer Confidence

 

A (Not So) Happy Thanksgiving For U.S. Data - consumer confidence

 

Consumer Spending

 

A (Not So) Happy Thanksgiving For U.S. Data - gdp

 

Do you see any economic green shoots? We don't.


Cartoon of the Day: Bulls Leading the People

Investors rejoiced as centrist Emmanuel Macron edged out far-right Marine Le Pen in France's election day voting. European equities were up as much as 4.7% on the news.

read more

McCullough: ‘This Crazy Stat Drives Stock Market Bears Nuts’

If you’re short the stock market today, and your boss asks why is the Nasdaq at an all-time high, here’s the only honest answer: So far, Nasdaq company earnings are up 46% year-over-year.

read more

Who's Right? The Stock Market or the Bond Market?

"As I see it, bonds look like they have further to fall, while stocks look tenuous at these levels," writes Peter Atwater, founder of Financial Insyghts.

read more

Poll of the Day: If You Could Have Lunch with One Fed Chair...

What do you think? Cast your vote. Let us know.

read more

Are Millennials Actually Lazy, Narcissists? An Interview with Neil Howe (Part 2)

An interview with Neil Howe on why Boomers and Xers get it all wrong.

read more

6 Charts: The French Election, Nasdaq All-Time Highs & An Earnings Scorecard

We've been telling investors for some time that global growth is picking up, get long stocks.

read more

Another French Revolution?

"Don't be complacent," writes Hedgeye Managing Director Neil Howe. "Tectonic shifts are underway in France. Is there the prospect of the new Sixth Republic? C'est vraiment possible."

read more

Cartoon of the Day: The Trend is Your Friend

"All of the key trending macro data suggests the U.S. economy is accelerating," Hedgeye CEO Keith McCullough says.

read more

A Sneak Peek At Hedgeye's 2017 GDP Estimates

Here's an inside look at our GDP estimates versus Wall Street consensus.

read more

Cartoon of the Day: Green Thumb

So far, 64 of 498 companies in the S&P 500 have reported aggregate sales and earnings growth of 6.1% and 16.8% respectively.

read more

Europe's Battles Against Apple, Google, Innovation & Jobs

"“I am very concerned the E.U. maintains a battle against the American giants while doing everything possible to sustain so-called national champions," writes economist Daniel Lacalle. "Attacking innovation doesn’t create jobs.”

read more

An Open Letter to Pandora Management...

"Please stop leaking information to the press," writes Hedgeye Internet & Media analyst Hesham Shaaban. "You are getting in your own way, and blowing up your shareholders in the process."

read more