November 9, 2021 | Daily JAM, Short Term |
China’s factory-gate prices, the Chinese equivalent of the U.S. Producer Price Index, grew at the fastest pace in 26 years in October. Factory inflation climbed 13.5% year over year, the National Bureau of Statistics reported Wednesday.(Economimsts had projected a 12.3% year over year increase.) Raw material costs continued to soar, with signs that producers are passing on higher costs to consumers. China’s consumer inflation rose by 1.5% in October, the fastest pace since September 20202.
November 3, 2021 | Daily JAM, Morning Briefing |
After today’s meeting of the Federal Reserve’s Open Market Committee the U.S. central bank said it would start slowing the pace of its monthly $120 billion in asset purchases this month. The slowdown would take place at a rate of $15 billion a month, which implies an end to the program by the middle of 2022.
October 27, 2021 | Daily JAM, Morning Briefing |
Consumers’ holiday spending intentions are a tad lower than in 2020, according to the latest survey from the Conference Board. On average, consumers intend to spend $648 on gifts this holiday season, according to the survey. That’s down from $673 in 2020. But it still leaves gift budgets at historically high levels.
October 26, 2021 | Daily JAM, Morning Briefing |
As bond yields have tumbled because of the Federal Reserve’s lower interest rates for longer monetary stance, investors have compensated by buying longer duration bonds. The logic is pretty simply. A one-year Treasury now yields 0.11%. A two-year Treasury pays 0.45%. A five-year Treasury yields 1.18%. The benchmark 10-year Treasury was paying 1.61% at the close today, October 26. Want more yield? You can buy the 30-year Treasury for a yield of 2.04%. The problem is that the longer the duration of a bond–the more time until maturity–the bigger the downward move in bond prices if/when the Federal Reserve decides to raise interest rates or if/when the financial markets decide to anticipate a Fed move by selling bonds ahead of any move by the U.S. central bank.
October 19, 2021 | Daily JAM, Morning Briefing |
Today, October 19, Procter & Gamble (PG) reported fiscal year first quarter earnings of $1.61 against Wall Street projections of $1.59. (That’s down 1% from the first quarter of the prior fiscal year.) Sales grew to $20.34 billion versus Wall Street expectations of $19.89 billion. Organic revenue growth was 4% against Wall Street expectations for 2.1%. So as the close today of the stock is down 1.18%. And the results today are seen as disappointing. To figure out why, look beyond those top of the report numbers to the squeeze on margins from higher raw materials costs and from rising expenses for shipping.
October 19, 2021 | Daily JAM, Videos |
I’m starting up my videos on JubakAM.com again–this time using YouTube as a platform. My sixtieth YouTube video “Trend of the Week: Hidden Inflation”” went up today.
October 15, 2021 | Daily JAM, Morning Briefing |
U.S. retail sales rose by 0.7% in September. That follows an upwardly revised 0.9% gain in August, the Commerce Department reported today. The biggest surprise came in autos. Motor vehicle and parts dealer sales rose 0.5% in September after a 3.3% decline in August. Excluding autos, retail sales advanced 0.8% in September. Economists surveyed by Bloomberg were looking for a 0.2% decline in overall sales and a 0.5% rise excluding autos.
October 14, 2021 | Daily JAM, Short Term |
You can see yesterday’s stock rally and its continuation today as a return of the Goldilocks market. Yesterday, for example, inflation, if you look just at core inflation–that is without food and energy prices–looked strong enough to make the Federal Reserve very cautious about removing monetary stimulus from the economy, but core inflation wasn’t so strong that it sent up warning flares. And today, the drop in initial claims for unemployment to 293,000 (for the week ended October 9) for a new Pandemic low argues that the economy continues to improve but that the economy in general and the job market in particular are neither too hot nor too cold In other words a Goldilocks scenario.
October 13, 2021 | Daily JAM, Morning Briefing |
Inflation wasn’t so bad in September–as long as you didn’t eat or use any energy. Headline inflation measured by the Consumer Price Index rose 0.4% from August and climbed at a 5.4% year over year rate. Core inflation, which excludes increases in the prices of food and energy on the grounds that they’re “volatile” rose by 0.2% from August.
October 1, 2021 | Daily JAM, Morning Briefing |
The Personal Consumption Expenditures index, the Federal Reserve’s preferred inflation measure, acce... To subscribe to JAM you need to fill in some details below including, ahem, some info on how you'll pay us. A subscription is $199 (although if you're subscribing...
September 23, 2021 | Daily JAM, Videos |
I’m starting up my videos on JubakAM.com again–this time using YouTube as a platform. My forty-ninth YouTube video “The market’s big fear is the economy” went up today.
September 22, 2021 | Daily JAM |
As expected the Federal Reserve’s Open Market Committee kept the central bank’s benchmark interest rate at 0% to 0.25% and left its bond buying program on a path to buy $120 billion of Treasuries and mortgage-backed assets a month. Unexpectedly, though, the bank indicated that a reduction in that bond buying program could happen “soon.” progress toward the Fed’s employment and inflation goals “continues broadly as expected, the committee judges that a moderation in the pace of asset purchases may soon be warranted,” the central bank’s said Wednesday in a statement following its two-day meeting. The Fed’s dot plot survey of central bank officials also revealed a move toward raising interest rates earlier than in the last survey in June.
