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Poll of The Day: Which Word Below BEST Reflects Your Opinion of the #Fed?

Four choices. choose one.

 

Poll of The Day: Which Word Below BEST Reflects Your Opinion of the #Fed? - fed poll

 


Retail Sales: Quick Take on Yet Another Miss

Takeaway: For retailers that report earnings publicly, the right Retail Sales categories missed and the wrong categories beat.

1) Retail Sales missed expectations for the 2nd time in a row after beating for 3 months straight. Only +1.9% vs expectations of +2.1% BEARISH.

2) We saw a 50bp sequential slowdown in the 2-year. 3-yr looks stable. NET BEARISH.

3) Decel all around ex Food, Gas, Auto. BEARISH.

4) By category, if you sell Food (+5.8%), On-Line (+10.9%), Health/Personal Care (+7.8) or Building Supplies (+2.2%) you’re in good shape. BULLISH.

5) Everything else was mostly down (GAFO, notably). Clothing down 1.1% and now faces a very difficult +2.4% comp vs Sept of last year. BEARISH.

 

Here’s the link to our Macro Overview of what people should be focused on with these numbers, but are not.

LINK: The Macro Show, with Retail Sector Head Brian McGough and Darius Dale | Replay

 

Retail Sales: Quick Take on Yet Another Miss - 9 15 2016 chart1

Retail Sales: Quick Take on Yet Another Miss - 9 15 2016 chart2

Retail Sales: Quick Take on Yet Another Miss - 9 15 2016 chart3

Retail Sales: Quick Take on Yet Another Miss - 9 15 2016 chart4

Retail Sales: Quick Take on Yet Another Miss - 9 15 2016 chart5

Retail Sales: Quick Take on Yet Another Miss - 9 15 2016 chart6

Retail Sales: Quick Take on Yet Another Miss - 9 15 2016 chart7


PREMIUM INSIGHT

[UNLOCKED] Keith's Daily Trading Ranges

[UNLOCKED] Keith's Daily Trading Ranges - z baba

This is a special (free) look at our Daily Trading Ranges product. These are Hedgeye CEO Keith McCullough's "buy and sell" levels on major markets, commodities and currencies. Subscribers receive it weekday mornings before the market opens. FYI - Our special 50% off deal on this product and others is about to expire.


investing ideas

Risk Managed Long Term Investing for Pros

Hedgeye CEO Keith McCullough handpicks the “best of the best” long and short ideas delivered to him by our team of over 30 research analysts across myriad sectors.

September 15, 2016

Want more from Daily Trading Ranges? CLICK HERE to submit up to 4 tickers you'd like to see on the list. 

 

  • Bullish Trend
  • Bearish Trend
  • Neutral

INDEX BUY TRADE SELL TRADE PREV. CLOSE
UST10Y
10-Year U.S. Treasury Yield
1.73 1.48 1.70
SPX
S&P 500
2,109 2,160 2,125
RUT
Russell 2000
1,197 1,231 1,211
COMPQ
NASDAQ Composite
5,110 5,228 5,173
XOP
SPDR S&P Oil & Gas Explore
35.05 36.93 35.71
RMZ
MSCI US REIT
1,150 1,210 1,171
NIKK
Nikkei 225 Index
16,306 16,699 16,614
DAX
German DAX Composite
10,288 10,562 10,378
VIX
Volatility Index
13.86 19.62 18.14
USD
U.S. Dollar Index
94.50 96.40 95.25
EURUSD
Euro
1.11 1.13 1.12
USDJPY
Japanese Yen
101.29 104.40 102.38
WTIC
Light Crude Oil Spot Price
42.44 46.49 43.58
NATGAS
Natural Gas Spot Price
2.64 2.97 2.89
GOLD
Gold Spot Price
1,305 1,358 1,326
COPPER
Copper Spot Price
2.05 2.16 2.15
AAPL
Apple Inc.
105.77 112.37 111.77
AMZN
Amazon.com Inc.
749 793 761
JPM
J.P. Morgan Chase & Co.
65.31 67.79 66.40
INTC
Intel Corp.
35.06 36.99 35.62
LVS
Las Vegas Sands Corp.
52.71 58.58 58.31
CMG
Chipotle Mexican Grill
399 439 414

Hedgeye's Daily Trading Ranges are twenty immediate-term (TRADE) buy and sell levels, along with our intermediate-term (TREND) view.  Click HERE for a video from Hedgeye CEO Keith McCullough on how to use these risk ranges.


CHART OF THE DAY: This Is #1 Causal Factor on "Slower and Lower for Longer"

Editor's Note: This is an excerpt and chart from today's Early Look written by Hedgeye CEO Keith McCullough. Click here to learn more. 

 

If you don’t get that Demographics is the #1 causal factor on slower and lower for longer, you’re definitely not reading Hedgeye’s Demography Research (see Chart of The Day for details on the rate of change in growth for the 35-54 year old US population). 

 

CHART OF THE DAY: This Is #1 Causal Factor on "Slower and Lower for Longer" - EL 15


Free Money Mess

“Originals are people who take the initiative to make their vision a reality.”

-Adam Grant

 

Isn’t that the truth? That’s one of the opening volleys in one of the better books I’ve read this year called OriginalsHow Non-Conformists Move The World, by Adam Grant. Sheryl Sandberg (COO of Facebook) called it “one of the most important and captivating books I have ever read.” #OrderIt

 

Originals aren’t always positive influences that move the world. Ben Bernanke and Dick Fuld were originals, for example. Today is actually tricky Dick’s 8th anniversary. On this day in 2008, Lehman Brothers officially filed for bankruptcy. In 2011, The Post Growth Institute labelled today, Free Money Day. I’m hearing that Bernanke is taking a helicopter ride to commemorate it.

 

Since those days of many risk management lessons already lost, many central-market-planners, bankers, and pundits have borrowed the original ideas of Bernanke and Fuld. Adam Grant calls this “kleptomnesia” – i.e. “accidentally remembering the ideas of others as our own.” Especially on Wall Street, you know as well as I do that there’s no accident in self-interest.

 

Back to the Global Macro Grind

 

Were Bernanke and Fuld non-conformists? Big time. Did it end well? Obviously for bankers of Fuld’s ilk, no. But what about those who have followed the ideological path of money printing, currency devaluation, and market manipulation?

 

The story about that central-market-planning #BeliefSystem is still being told.

 

In the same opening chapter, Adam Grant reminds us of the risks of not changing our minds when going against the grain goes bad. He illuminates that reality using a great quote from George Bernard Shaw:

 

“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.”

 

Since Draghi, Kuroda, Yellen, etc. took the baton from Bernanke and took us down this rat hole towards Free Money Forever have they adapted themselves to the world’s markets reactions? Or have they continued to try to tell markets to react to them?

Free Money Mess - central bank kool aid 06.09.2016

 

These are critical questions that I think most reasonable (and un-reasonable) central bankers would be held to account to if they were actually elected by The People. Instead, as long as no one forwards my notes, I’m one of the originals taking them to task.

 

I did it in 2008. I’m doing it now. I do it in print, on video, and in cartoons, every day. And I like it.

 

I do it on the road seeing Institutional Investors too. Between NYC and Kansas City, I just finished 2 days of meetings and I have to say that there’s nothing else people want to talk about other than the Federal Reserve, ECB, BOJ, PBOC, BOE, and the US election.

 

‘Good call on #GrowthSlowing Keith… but what’s the Fed going to do in response. How about the BOJ in response to the Fed? … can and will Draghi do more? … how about China? Who is Trump going to pick to run the Fed if Hillary’s man is Summers?’

 

And it goes on and on and on… so many questions that have so few answers as clear as #GrowthSlowing itself.

 

Meanwhile most establishment economists (non-originals) are sitting in their ivory towers confounded by things like the Philips Curve getting crushed and US Productivity being on its worst run since the 1970s.

 

Here’s a DCF model I built for them on productivity (please borrow it as your own!):

 

  1. D = Demographics
  2. C = Capex
  3. F = Federal Reserve

 

If you don’t get that Demographics is the #1 causal factor on slower and lower for longer, you’re definitely not reading Hedgeye’s Demography Research (see Chart of The Day for details on the rate of change in growth for the 35-54 year old US population). You didn’t need to know anything about Dick’s “level 3 assets” to know what that line going red in 2007 meant.

 

Capex is running negative -4.9% on a year-over-year basis (negative for 9 straight months) because most sane business people consider the Fed flip-flopping from hawkish to dovish (6x in 8 months) insane. Why in God’s good name would you “invest” at this stage of the #GrowthSlowing cycle as the #BeliefSystem that the Fed, ECB, BOJ, PBOC, BOE, etc. breaks down?

 

No. The answer isn’t “raise rates so that we can get out of this mess.” The entire capital market system is held up by this mess. And, especially for the original bankers who built the foundations of these non-free “markets”, as our Chief Compliance Officer, Moshe Silver, often reminds us… “it’s a lot easier to make a mess than to clean it up.”

 

Our immediate-term Global Macro Risk Ranges are now:

 

UST 10yr Yield 1.48-1.73%

SPX 2109-2160

VIX 13.86-19.62
EUR/USD 1.11--1.13
Oil (WTI) 42.44-46.49

Gold 1

 

Best of luck out there today,

KM

 

Keith R. McCullough
Chief Executive Officer

 

Free Money Mess - EL 15


Daily Trading Ranges

20 Proprietary Risk Ranges

Daily Trading Ranges is designed to help you understand where you’re buying and selling within the risk range and help you make better sales at the top end of the range and purchases at the low end.

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