Bad Economic News… When It Rains, It Pours – Ep 74

Bad Economic News… When It Rains, It Pours – Ep 74


* Dollar usually drops on bad news but rallies because traders automatically buy on the dip
* Bad news is dismissed because the first quarter "doesn't count"
* This puts greater pressure on the last 3 quarters to make up for the first quarter and still show growth
* Expectations of a bump similar to last year are based on non-repeatable conditions - Obamacare and inventory build
* Inventory to sales ratio is the highest it has been since 2009
* What is the basis for dismissal of the bad news in Q1?
* Data confirms that the consumer is already broke
* Consumers will be hit with rising oil prices
* Traders who are loading up on the dollar are ignoring all the evidence that they are wrong
* The wake-up call will be like the sub-prime mortgage crisis
* The same thing will happen in the Foreign Exchange Markets when they realize the story is not about a recovery but about another round of QE
* Changing trend coming in the dollar
* Changing trend in the oil market
* Changing trend in the gold market
* If we don't get a recovery in the summer how is the Fed going to raise rates in Q4?
* Election year 2016 will likely see no rate hikes
* Retail Sales missed Wall Street expectations with a bounce of only .9
* March Small Business Optimism fell to lowest level in 9 months
* Hiring Plans dropped to lowest level in 6 months
* Business Inventories for February rose to .3 based on weak wholesale sales
* Inventory to Sales Ratio holding at 1.36 (highest since July of 2009)
* My radio broadcasts from a year ago predicted that the data was not reflecting reality
* April Empire State Manufacturing Index missed expectations at -1.9, near a 2-year low

* Employment down
* Hours worked down
* New orders down to 3-year lows
* Prices paid went up


* March Industrial Production dropped .6, missing expectations - 4th consecutive month below estimate
* This news can't be blamed on April showers
* Those who have been betting on the recovery are about to realize they made the wrong bet
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Jaksot(1120)

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