When we first began to discuss the possibility of a blow-off top in markets, a lot of the naysayers and charlatans put on the attack dogs. “World’s gonna end…Ure is an idiot…get gold, guns, grub, and don’t be under the sky because it is falling…”
They were right on the Ure’s an idiot part, but not the rest.
Yet here we are 8-months after I called the market low in February with the blow-off to come, and where are we?
18 points from an S&P 500 breaking through 2,200. With the futures this morning up 5 more points, that could fall this week and then the only question is which of my targets (2,300 or 2,400) will be reached before the mother of all declines.
There is not a lot to go over with you this morning. I don’t give a rip about sports, so there goes one third of news.
What we can do is reasonably go over items that could impact our outlook. These are particular kinds of news stories and the press release calendar.
The Week Ahead
There isn’t much going on today except for a number of bond settlements. Bonds are likely making a long term bottom.;..and as this happens, hot money will seek higher returns and that is what sets up the pending rally.
Tomorrow we will see productivity and labor cost data. Most of the other data this week looks quite useless: Until Friday.
That is when Retail Sales comes out and that for sure is a biggy.
My reasoning is simple: The latest consumer debt report shows a striking one-month rise of 9% in credit card (revolving debt) use.
At some point, retail will catch up more or less…and optimism – of the sort I have been trying to yammer about for nearly a year – will be here in our faces in an undeniable way.
What is Left? Headlines
But here we don’t see much that will move markets.
The Health of Hillary
We are moving into a period of very even-handed reporting now since the polls show that the presidential contest is nearly a dead heat – for reasons than frighten me to the core.
Nevertheless, the world perception promoted by the mainstream media is that all Hillary has to do is fog a mirror to win.
Which gets us to the matter of her health as she seemed to have some problems with a half flight of stairs – something caught on film.
Hillary’s other problems include questions about whether her email behavior undermined America’s relationship with Iran.
Then we have the Washington Post questioning promise-versus-performance of Hillary: She promised 200,000 jobs for upstate New York, but failed to deliver.
Blowing in China where some recent disappointing numbers may keep export prices in check.
On the other hand, industrial output in Germany was stronger than expected in June. We do have to wonder how much of this is driven by the import of foreigners. there has to be a diffusion study of how long before a population bomb going off runs its course.
It’s called a “single point of failure” and in engineering design what is the one thing you never want to have happen?
Well, in airplanes, for example, there is often some redundancy in larger aircraft.
But not necessarily in airlines.
Problem with rebooting will likely be schedule delays, which means missed connections and a whole lot more.
While too early to tell, this may have an adverse impact on the quarter depending on DBC (denied boarding compensation) and such. It will be interesting to study the aftermath..
Passings: The American Vacation
While we try to take time off or at least travel, I figure there’s a correlation between people take less vacation time and people (like us) working well into retirement.
So Much for Monday
Consider working on your own future (and monetization) instead of buying that of others.
This is a fine morning for a nap.