Global Synchronized Inflation Arrives

This is a great economy – if your name happens to be AT&T or FOX.  But, that’s not the case for working Americans.  But, what does matter is our growth prospects.

Wednesday, the Federal Reserve chairman Jerome Powell announced the expected quarter point hike in the  Fed’s key rate.  Not a great big deal, except (and I think I heard this correctly in the press conference) they are looking at a possible four more hikes in the coming year, or so.  Bad?  Not really.  Their upside expectations are improving.  Not as fast as the Trump White House, but still, a positive tick.

The markets were not impressed.  Specifically, the Dow dropped more than 100 points by the close in one of those “buy the rumor, sell the news” events we like for short-term lunch money trading.

It’s possible the market has begun a somewhat delayed version of “sell in May and go away.”

Still, the futures didn’t seem particularly bad when we looked earlier – about even, in fact – that was before this morning’s report on Retail Sales (hold on, we’ll get to that next!) – but it’s helpful to know how to look at markets.

There are three “legs” to our economic milk stool.

  • a) How money money is sloshing around the economy?
  • b) What are markets as an aggregate doing?
  • c) What is the relative strength of the US dollar in the global blender?

Since you may not be one of our Peoplenomics subscribers, we therefore assume you’re not especially interested in making money or getting rich.  We’ll keep this short and only focus briefly on this morning’s data as it relates to currencies.

A quick look at the overnight charts showed the Dollar haf been trading around .8475 *to the Euro* at its peaks.  However, working toward the US open (not the golf one, idiot!) dollars dropped to around .8460 on peaks closer to the open.

Whazzat mean?  (Put on your aggregate economics hat and stop playing like this is a single-room adventure game, please!  There are more rooms…capiche?):  It means that, it will take a few more dollars to buy the Dow here.  Since the dollar is only worth (In Euros, but its a fair proxy for the rest of the world) we know it will take only 0.9982300884955752 Euros to yesterday’s 1.

The Dow closed yesterday at 25,201.20 but priced on a global basis today (using stronger Euros) 25,156 and change on the global market.

However, here in the US of A, since we don’t use Euros, it will appear (misleadingly so at times) like the US the market is doing UP. And it is….sort of.

Globally – all currencies considered – not so much.  It will take a few more dollars to buy the same thing as yesterday’s for domestic traders.

In reality,, it’s far more complicated:  Since the effects of foreign exchange over time aren’t included, nor is the hysteresis (lag and lead times) as currency changes ripple into markets.  The simple take away from this is three-fold:

When the dollar is going down (which is did) it takes more to buy the Dow or anything else.  That’s a key concept to hold when you’re trying to out-think the market.  How much is based on domestic fundamentals and how much is based on the international judgment.  There are two currencies playing our markets all the time:  The domestic nominal US Buck and the foreign basket of currencies made up of Yuan, Frans, Marks, and even to an extent gold and silver.  Sure, toss in a further complication in commodities, as well.

Just begin to notice how when the dollar goes down a bit (relative to the rest of the world or the Euro proxy) you may see a misleading “rally” in domestic prices which, if you’re managing money from Switzerland means our markets are still going down for the Swiss gnomes and others.

Feeling better?  It’s OK.  In our odd view of things, the real bull market blow off doesn’t start until our Aggregate (*US) gets above the red line.

Moreover, I showed you last week – Friday, wasn’t it? – that a logical place for the market to be turned back on its manic rally would be at the blue overhead resistance line.

Took it’s sweet time, but as expected.  So, I’d like to thank Chairman Powell for being so obliging as to make us some lunch money.

Ideally, we will rally for  while today, but with uncertainty building again about Trump’s future the little bounce this morning could lead to a resumption of downside action to close out the week.  This isn’t trading advice because you have no idea how I play things.  Come to think of it, neither do I, lol.

Of course, as soon as things started to make sense, along came the European Central Bank to announce they are ending economic stimulus in December:  (Euro tumbles as ECB vows to keep rate down)

“First, as regards non-standard monetary policy measures, the Governing Council will continue to make net purchases under the asset purchase programme (APP) at the current monthly pace of €30 billion until the end of September 2018. The Governing Council anticipates that, after September 2018, subject to incoming data confirming the Governing Council’s medium-term inflation outlook, the monthly pace of the net asset purchases will be reduced to €15 billion until the end of December 2018 and that net purchases will then end.

Second, the Governing Council intends to maintain its policy of reinvesting the principal payments from maturing securities purchased under the APP for an extended period of time after the end of the net asset purchases, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.

Third, the Governing Council decided that the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.40% respectively. The Governing Council expects the key ECB interest rates to remain at their present levels at least through the summer of 2019 and in any case for as long as necessary to ensure that the evolution of inflation remains aligned with the current expectations of a sustained adjustment path.”

All of which means that Global Synchronized Inflation is being played despite the trade worries, so whether we break out to the upside on our chart will be the focus of today’s chair-time in front of the computer.


Was in the  $6,400 t0 $6,500 range. when I looked.

Our view on Bitcoin has been consistent from the start:  It’s a made-up money scam backed by nothing of practical value.  There is no “standing good for delivery” of anything other than electrodigits which makes no sense at all.  And then to piss away thousands of kilowatt-hours in delusional “mining” which has no value…well, there are rehab places for the delusional.

Blockchains  are still just an electronic scheme to make just one copy of something…and that, kiddies, doesn’t getcha sh*t.

Unfortunately for the coiners, who are scammers selling digital tulips as their wares, governments of the world are not likely to bite on a digital undilutable currency, any more than they will on gold or silver.  The government scam precludes the Bitcoin scam…

A person has to be blind, and stupid to see that Global governments aren’t all selling the same interest-backed global inflation scam.  I am amazed at how many coin believers think government will “get honest” all of a sudden.  NFW!.  Thus, people buying into a non-inflation adjusting scam and thinking it will fly?  Their on the wrong side of the G7, G20 and basically all the world’s armies and navies.  How can one not see it?  Synchronized Global Inflation is underway, for crying out loud.

It you want to support pissing away resources that could be used for something honest in the future, have fun.  Ethically, people who trade cryptos are in our view, “challenged” and let’s toss in “delusional.”

On to Retail Sales

Here’s the latest from Census on Retail Sales.  I ask:  Does this look healthy to you?

Hell yeah…that’s growth.  Until you read that a ton of revisions are included this month.

Still, here’s the press release:

Advance estimates of U.S. retail and food services sales for May 2018, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $502.0 billion, an increase of 0.8 percent (±0.5 percent) from the previous month, and 5.9 percent (±0.5 percent) above May 2017. Total sales for the March 2018 through May 2018 period were up 5.2 percent (±0.5 percent) from the same period a year ago. The March 2018 to April 2018 percent change was revised from up 0.2 percent (±0.7 percent)* to up 0.4 percent (±0.2 percent).

Trump Day

Sessions warns IG report on Clinton email case could lead to more firings.

More on the Morrow…

18 thoughts on “Global Synchronized Inflation Arrives”

  1. “the Federal Reserve chairman Jerome Powell announced the expected quarter point hike in the Fed’s key rate. Not a great big deal, except (and I think I heard this correctly in the press conference) they are looking at a possible four more hikes in the coming year, or so.”

    Hmm.. to me that says they are going to remove some of the water that they have been floating the noodle on..
    well our insurance agent will sleep better tonight.. I have been checking daily on the progress of the insurance policy being accepted and the plan in place. today she asked why I was so concerned.. I had to explain to her the reason I was worried was several years ago. ( that is how my wife and I became close friends) I worked for the county.. but after the insurance tab I had to work a second full time job.. and a part time job to make ends meet.. well my boss through a fit because on Saturday mornings I had been working 36 hours straight without any rest time and was tired.. after I explained to him that after insurance with the county I took home 307.00 a month.. well he wanted to be able to take Saturdays off and wanted me to find a different insurance. I shopped around and found one it was just before thanks giving.. paid the two months premiums and took the physical etc. we got paid on the 24th of the month so Christmas was looming and on the twentieth I called him and asked if he had heard.. he wasn’t sure but said he would call and make sure.. the next day he called back and said oh it wasn’t any problem the family was covered but because Christmas and new years was coming up not to expect anything till the fifteenth of January but it was ok to drop the insurance. So I trusted him and did like an ignorant idiot.. Well time came and went for them to take out the payment in January and no paperwork. I called to see how it was progressing and he said oh yeah I was going to call they decided that because you are 207 lbs that you are thirty pounds over the 164 lb. recommended weight for your height and so your not covered.. I then couldn’t get back on the counties policy and because I was determined uninsurable couldn’t get on any other policy with anyone else. I had to face it..I was totally uninsurable.. anyway I tried for three years to get on another policy and was saving the premiums to make sure I had the funds if anything came up.. then my ex had gallbladder issues.. took her to the free clinic.. they did surgery.. same day surgery.. the cost was shocking.. it was four times what the church pastors costs were for the exact same surgery and the exact same doctor same hospital and everything.. what I had been saving didn’t amount to anything in comparison for the bill.. went in and talked to the surgeon and said I don’t have that kind of money but I can work it off.. so he let me resurface his parking lot by hand.( I will never do that again.) and because it was late summer the heat and humidity was over a hundred the parking lot didn’t look that big but once I got on it it was huge almost a quarter of a city block.. My wife now was worried about me because she had had some medical issues and went through the same thing prior and she came to help and make sure I was ok and help me work on the parking lot getting it prepped.. I had to design and make the tools I needed to do the job by hand( trust me you have no clue till you have done it).. then I did the same thing for the hospital.. you cannot believe the crap they put me through called every half hour they called late at night called my boss and his mother inlaw my inlaws my parents It was pure hell LOL LOL LOL eventually they let me work a year to pay off the debt to them. So for a year I worked three full time and one part time jobs between 140 – 160 hours a week. It about killed me.( one day I was feeling sorry for myself went in to get gas and seen a woman in a wheelchair crying. asked her what was wrong. she was a housekeeper at the hospital got off on a new years eve and was smoked by a drunk driver. he didn’t have insurance and died.. she had insurance at the hospital but it was an accident not a health issue and they refused to cover it.. now that wasn’t the clinker she will be a quad her whole life. they decided hell I will just take it out of her bank left her with 75.00 a month to live on.I didn’t feel sorry for myself anymore. gave her the name of an attorny to talk to. I think he took it on just to help her out.)You will never know till you have been down that road what it is like.
    anyway now with getting the insurance I am willing to pay the what six and a half dollars an hour take home wage to pay the insurance.. but on the other hand that is thirteen thousand dollars a year plus that I won’t be buying other stuff.. and with them draining the table.. I do know I am not the only one in the bottom feeder class that has these issues so what will that do to the economy… LOL oh found a book I had never read before.. great book on the working class in chicago during the last depression. the jungle by sinclair.. great book.. got it out of the law library at harvard.. amazing

    • I should explain.. the two weeks I worked about 160 hours.. I screwed up in self scheduling.. it was crazy.. but what was interesting is after the third day.. everything got clear.. crystal clear.. no tiredness.. it was pure adrenaline… I was so worried after that long schedule that I wouldn’t wake up.. but have a heart attack that I had people sit around me while I slept to make sure. and have the equipment available to get me going again just in case.. years later a friend of mine was attempting to do the same exact thing.. I wasn’t doing good health wise and we were out and I told him to not do it.. look at my crazy work life did to me.. he didn’t listen and when I talked to him last he was going to go get some sleep he was tired.. went laid down and died with a heart attack. so don’t try it..

      • Still haven’t looked into Samaritan Ministries or Liberty Health Share or any of them, have you??? Do you know Samaritan Ministries has been around 25 years. 25 years of helping it’s members share each other’s burdens and help pay their medical bills. It is exempted from Obamacare. You don’t have to pay those exhorbitant monthly premiums nor high deductibles, no one who reads these words need to. Geesh, come on, look into it!!! There is a hospital in Oklahoma that has cash prices for over 100 types of surgeries, they don’t take insurance. They have every single surgery’s price right there posted on their website, no hidden fees. A lot of doctors reduce their fees for people without insurance. A lot of doctors aren’t accepting insurance and all the red tape. I read your story, Man, and my heart goes out to ya, but then I think to myself, he reminds me of that great saying, ‘you can lead a horse to water but you can’t make him drink.’

      • “Quit it”..I really appreciate that information.. NO I didn’t check into them.. I didn’t even know they existed.. as for insurance companies I know many that are offered in other states are not offered or available here.. in our area there is basically two companies .. both companies I actually worked for in the past.
        I will definitely be looking into these.. the hospital I worked a year for sells one policy.. (they actually re wrote the hospitals mission statement over my case..)
        you would be shocked at how many get turned away… there was one surgery that they said I needed.. actually really scary.. the insurance company I had at the time. would send me brochures from other countries where the surgery was performed cheaper..

      • its scary because I have a bad hernia.. at times the stomach comes up into the chest cavity.. you don’t want that .. because they found cancer and I have a lot of issues. they go down a lot.. like every six months.. Now they only have me see a specialist because one time when the doctor was in my stomach followed the scope out.. she was in tears.. she asked me if I remembered any of what happened.. I of course told her no..( I do remember the whole situation and how scared she was.. the real scary thing is when they put me out for a surgery, I can’t move or anything but part of me is still awake and I remember stuff like what they are talking about or doing.. etc.I had often wondered if it is because I am ambidexterous.. when I was a kid I could write with one hand and draw with the other.. ( hard to do.. you have to empty your mind completely and my mind is usually thinking about fifty things at one time..)I had one surgery and all they talked about was eating.. god I was so hungry afterwards..) Now I usually tell them to smoke me good because I don’t want to remember that stuff..

      • Listen, here are a few links:

        I, unfortunately, know ALL about being conscious while in a coma. Major drugs did not make my conscious unconscious, some people just don’t go under like others, and that’s a fact.

        Even with pre-existing conditions, these programs have a solution, some is time, some is other kinds of sharing programs.

        These programs are a God send to thousands of people, every single day, across this country. Of course they are not going to get any press, but do your research, and move forward. The PPACA is a scam and a wealth transfer, can’t you raise your testimony to that? Half your take home pay? Don’t people in this country remember that just 15 years ago, $7,000 in medical bills was the #1 reason for a person or family to file for bankruptcy? Why then, would anyone think that $5k, $7,500, $10k, or above deductibles would work? Or monthly premiums up and over $1200, $1,500, and above for couples and families would work? Can’t you see it? Salaries and hourly rates haven’t increased that much in the last 15 years to warrant these kinds of monthly premiums and deductibles, nor expenses that these ‘insurance contracts’ don’t pay. Time to Think Outside Of The Box and QUIT the insurance scam!

    • ANDY INVEST NOW AND AND WATCH wat perduces latrer (( 8iam 9onb the computer without voice so he is i the nettteic grriyyy forllow with the iam watching while this is manual

  2. Bought more digibyte at less than .03 cents and holding.
    Watch as more heads of Corporations and governments condemned Bitcoin and blockchain and then they’ll turn around and do the opposite ,they will buy buy and buy.
    You say why well they have a big portion of Bitcoin and they are selling it cheap to make the Sheep who are on the edge sell theirs and then they the corporations buy more of it at the cheap ,
    the corporations do it’s like the CIA they say one thing but do another.
    And I see George next year buying some cryptocurrencies,
    Why because his charts will tell him to and he will jump on the York Boat and he will do quite well at it.

    May all beings be lovingly for Phil so be it and financially for filled and while you’re at it do a little bit to save Mother Earth and the plastic filled oceans that are killing all of the Aquatic Life

    • If the last Bitcoin is worth a trillion dollars because of the amount of electricity that goes into it well there you go that’s the future the future will be those people with billions of dollars will override the patent system and will make devices that make energy from the free energy that already exist on the planet.

      As George says it’s all a business model.

    • “Lovingly for Phil.” I love it. I am hard of hearing and hear the funniest of things instead of what I am supposed to hear. But now I’m reading like I’m hearing!!!

  3. lol lol who said during those crazy egg timer days.. heck I still only sleep three to five hours a day.. LOL five hours I am really sleeping in LOL..

  4. When “working Americans” should have hung that greening span they took no action. When Nix-0n took US$ off the golden standard “working Americans” didn’t even notice. Yes, live is good for the 1%, like it was all through history; But it says: “You cannot make a silk purse out of a sow’s ear” (the majority/Bolsheviks). I rest my case, because 5K years of history makes my point!!

  5. You know this constant MSM slanting against Trump may be hurting them much more than they realize.

    • Let me see: promoted by a leading Trump Basher – and when countering the Clinton Foundation? Oh, to live in a country of even-handed Justice.
      While Obama et al orchestrated hiring OCONUS “lures?” Tougher call, methinks

  6. Way of topic and wrong day and anyway? Read you do welding and in a city shop of seemed many workers in an attempt to sell me parts put a drill bit hole of “seemingly” 7/32 into my engine block..first water pump.for loose expansion tank hose clamp tightening..then drill bit hole…then radiator ..then valve gasgets and gromets..then head gaskets.then exhaust manifold gaskets each stop with some glue repair on the drill bit hole and the customer driving off how many multiple of multiple thousand dollar repairs till he finds out his motor and car is trashed and they who destroyed the engine block do not repair engine blocks..weld..?

    • I’d find the meanest nastiest attorney I could find and launch a class action – taken ’em down

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