FED FUND RATE NOW 5% NEGETIVE TO INFLTIONMMT Says "PRINTING FOR THE PEOPLE'S ECONOMY" I don't think the people like 5% inflation. KEEP PRINTING!Shortby RealMacroUpdated 6616
Market Cycle: BTC vs. ISMBTC cycle low precedes the ISM cycle low by about 1 year, while the BTC and ISM cycle highs occur at roughly the same within the market cycle. Presumably, the cycle highs are roughly coincident due to increased liquidity associated with QE?...by SKYNETrader3
Durable goods orders indexHi everybody , you see on social media and influencers channels huge exaggeration about us economic data like this and they show all things strong and well but please se otherside of coin with me ,,, you should check that core durable goods orders doesnt change at all related to previous month all increasing on durable goods orders was based on transportation orders and if you eliminate that you get the reality .....i put for you the link to check this out by your own :https://uk.investing.com/economic-calendar/core-durable-goods-orders-59 always go to data deeply with me . comment your idea below. stay safe and logical by Logical_Markets0
wages versus purchasing powerWages are naturally built to out perform purchasing power. Wages go UP... purchasing power goes DOWN. However, when this relation goes in overdrive, POWERFUL macro tides are changing, which forces investments portfolios to shift and adapt. #silver #gold #crudeoil #fintwit #spxLongby Badcharts114
REAL GDP/DEBT KEEPS COLLAPSING!!One of the best ways to think about public debt is to think of oil extraction. How many barrels of oil are required to extract 1 barrel? Right now we are extracting only $0.64 cents of GDP for every new $ of added public debt. This is a horrific ROI. Can you imagine using 1 barrel of oil to extract 64% of a barrel of oil? To make matters worse it keeps falling and falling for decades now. Wait it gets even worse! Ask yourselves this. If the US cannot produce at least $1 of REAL GDP (inflation-adjusted) for $1 of added debt while we are at max employment and firing on all cylinders. When will we? Long gone are the days we used to produce $14 of real GDP for every $1 of added debt. Yet the politicians the MMT crowd (who are really politically driven) keep telling you deficits "stimulate the people's economy" "deficits are a myth" and "do not worry how we are going to pay for it, worry how we will spend it!" I am sorry to all those who still believe deficits are "stimulative". The data does not agree with your claims. "Normal" Deficits at max employment used to range around 2 to 3% of GDP. Today we are around 8% of GDP. Sustainable? I don't think so. The more we print the less GDP the more we have to print the less GDP and so on. This is what happened in Turkey which I have been warning about for years. Sri Lank, Lebanon, Pakistan etc.. As long as we are credit worthy this will go on. The one-trick pony of printing works great until it doesn't. it's the "doesn't" part we should all be worried about. You may not be able to understand how to use this information in your trading style. But at least you are more informed as to what the reality is the next time you hear a politician say we need to "STIMULATE THE ECONOMY"Shortby RealMacro12
Fed Liquidity is predicating the inevitable Here we can see two things. The S&P 500 and Fed liquidity (The thing that has held our markets together since 2020). They are breaking away from each other in a way not seen in years. Is this rally bullish or bullsh*t?by Hasbula225
Wage acceleration = Purchasing Power Decrease!!! DIFFICULT CONCEPT TO GRASP !!! 🤔The more your wages go UP, the more your purchasing power goes DOWN. 😵Crowd is getting fooled by the fiat currency illusion. 💡Gold and Silver will remove the illusion. 💁♂️Help share and spread mass awareness. #gold #silver #inflationLongby Badcharts3
US inflation data is at multi year resistance..Us inflation is at multi year resistance.it shows inflation has already peaked. once it will start coming down markets will rally to the upside. Will markets makes new ath sooner or later ? Well who knows?? Ask yourself that question. Will fed stop rising rates for now? Very unlikely. Will fed could consider lowering the basis points ? Most likely. Will fed do it in upcoming meeting (23rd sep'22) this month? Unlikely. Shortby EsCApetHEmAtRiCSUpdated 1110
DXY | JPY | CREDIT EVENT | DECRYPTERS Hi People Welcome to Team " DECRYPTERS" SO we Have 3 Main events this Week Lets Get A DEEP DIVE IN TO THEM 1- FED :- FED RATE HIKES ( PRICED IN ) + PRESS CONFERENCE ( HAWKISH ) AS we predicted Last time what Ever Happen Rate hikes will be increased we still stand by our words . Lets go further Either we are Getting 50 BPS This time or We are Getting 25 BPS next time WHY Is That So ... ?? The Attached Charts shows the overall level of financial conditions in an economy The conditions are on Same levels When FED was ABOUT to hike Rates Meaning . Further more —Dot plots , Fed curves ,GSUSCFI Index and Bloom Berg Index & Fall in Credit spread "ALL" Indicating ease in financial system Meaning this Data provide Evidence that FED Can increase More Interest Rates As Credit spread also falling to positive signal for economy — Rise In commodity Prices Like (RBAB Gasoline) Indicates more higher Prices in Energy sectors. — Lastly Good inflation trading above 20 years average & CPI Also printing higher on Y/Y Basis. 2- EURO RATE HIKES :- THIS comes With same Expectations Rate hikes + Hawkish Stance with & Lagarde speech. Lets Discuss JPY NEWS ON FRIDAY 3- BOJ REPORT :- A surprise can be Expected From Other Side Like They can Increase the range of "10 -years JGB" 50 BPS TO 75 /100 BPS ( BOND BUYING BACK PROGRAM) This will Cause bonds Prices to Rise / Yields to Fall & "JPY TO GET WEAKEN" —Other yield can React Negatively To IT ( LIKE US -10 YEAR) by DECRYPTERS4
Corporate Profits Inflation AdjustedCorporate Profits Inflation Adjusted has been falling as expected when I first published this chart. But unlike the first chart I have inflation-adjusted it this time to get a more accurate reading. Something we have not needed to do for decades. Before I continue can you chart corporate profits and like charts? Answer yes you can which is why I added the patterns. As you can see we have double topped sitting on a rising 3rd gear trendline right now. The likelihood it will fail and CP will continue to contract. However, stock prices are rising while profits are falling which tells us we are in a Euphoric, FOMO, multiple expansion market. Multiple Expansion simply means people are paying more and more for less and less earnings. This is not a good sign for bulls even if they expect higher earnings in the future. Any pump in future earnings will be short-lived simply bc we are at max employment. Unless you can find more workers with more wages or workers get higher wages in the aggregate (which would be inflationary cutting into profits as labor unit costs rise) then we should not expect CP to blast off anytime soon. Another way CP could rise is to once again use helicopter money, QE massive deficits, lending programs etc.. which would also be inflationary. Pick your poison. Having said all that Multiple Expansions can and have run for a while bc markets are irrational. If you haven't figured that out by now. Read extraordinary popular delusions and the madness of crowds.Shortby RealMacroUpdated 2210
cpi vs dxyNext purchasing power DESTRUCTION cycle could be MASSSIVE! #gold #silver #crudeoil #dxy continuation breakout (10 years) CRITICAL paradigm shift breakout line (25 years)Longby Badcharts3
Harmonically, US Interest Rates are Headed Toward 35%The US Interest Rate chart has been trading within a Descending Broadening Wedge and has recently broken out of the wedge. The target for a pattern like this is typically back to the inception of the pattern, which in this case would be 20%; but we also have an additional variable here, and that's the Potential Logscale Harmonic Formation we've made here. If we are to treat the action of this chart as we'd treat any other chart, then we'd expect that once B gets broken, we'd get an accelerated move all the way up to the Harmonic Completion of a Bearish Shark, which would land us at the 1.13/1.618 Harmonic Confluence Zone up at around 34-35% There have been previous instances where Harmonics have had a predictive quality over data like this, such as the accelerated liquidity exit out of the reverse repo facility, the bond yield charts on multiple occasions, and the US Inflation Rate Charts. Which can all be seen in the related ideas tab if you are skeptical of my use of Harmonic Patterns in this context.Longby RizeSenpai5
Liquidity and $SPYThis measure of Liquidity (blue line) generally tracks AMEX:SPY (orange line). Both were generally declining throughout 2022 and then increasing in 1H 2023. However, in the last month or so there has been a marked divergence, the resolution of which may be an important aspect of equity market direction. One to watch.by jay_S_1
bullish bonds through 2026 long termInterest rates look like they may cap on this chart and if so a fall to next support shown would be a good long term target, then in 2026-2027 on they could become bearish again as rates rise This is just a prediction, use your own analysis and cross checking.by candlestickninja2
Return To BaseA "back to the basics" analysis. Let's leave behind the stock markets and look at the slow and deep fundamentals of the worldwide economy. Today I will attempt to make a simple analysis using GDP. This is the net profit of one country. The miracle of China caught the West in the sleep. It outperformed the largest economy of the world. And by incredible speeds. Many use the "stochastic" indicator, and rightfully so. The word stochastic may be coming from the Greek word "stochasmos" which means "thought process". To get a new perspective on these charts we must let nature think for us objectively. The mind of nature spoke. The miracle of China is fading. And the same happens when compared to the "treasure" called Taiwan. Many are willing to fight for it. For experimentation, let's compare the US with the Eurozone. For some unknown-to-me reason, GDP has embedded in it the relative strength of currencies between the two countries. Do note that all GDP is measured in USD. In a sense, relative GDP growth is another way of comparing currency strength. We have gone from comparing equities, to comparing GDP. We concluded that comparing GDP is simply comparing purchasing power of two countries. Currency strength comes from yield rates. The power is given from those who make and define money. Supply + Yields. Power = Money Supply * Money Strength MV = PQ Tread lightly, for this is hallowed ground. -Father Grigori P.S. You want to see an Easter Egg? Consider the following equations: MV = PQ Q = GDP M = M2SL V = FRED:M2V P = "price level" 1 / P = "currency strength" Currency Strength = Q / MV In the end, it is up to the FED to decide the future.by akikostasUpdated 8
Economic Depression Ahead?We got some levels never seen in the last 40 years. Usually, the recessions start when the Yield Curve changes direction and comes back to positive territory. This time the numbers are huge and considering the National Debt Level...we could see an Economic Depression. Interest rates reduction within September 2023 and the start of the Recession by July 2023? My advice to the Federal Reserve: 💥 Don't Fight the Bond Market!!by gilocUpdated 2212
Interest Payments vs DefenseSilver above 400$ in 10 years? Possible. Do not underestimate the central banks and governments capacity to destroy your purchasing power. #silver #gold #inflation #usdollar It is all about HOW FAST something is happeningLongby Badcharts110
US Treasury General Account MonitoringThe Treasury General Account (TGA) prior to the GFC of 2008 averaged between $4 and $5 billion. When the debt ceiling people freaked when it hit $48 billion (9X more than the historic average.) LOL! Today it's $500 billion 100X more than the historic average on its way to $600! Oddly enough to MMTers the TGA has never gone negative (As my friend @HenricCont rightly points out) as #MMT claims that Gov't spends first taxes later. If TGA did go negative that would mean the Gov't spent more than tax revenues and borrowing. (Which is illegal in the US) Q. Why doesn't the Federal Reserve just buy Treasury securities directly from the U.S. Treasury? A. The short answer is that it supports the independence of the central bank in the conduct of monetary policy. The prices for new Treasury securities are set by private market demand and supply conditions through Treasury auctions. Note This is not to be confused with QE (open market operations) the FED is allowed to buy in the open market and does. But that is not funding Gov't spending as such it is NOT increasing public debt. It is merely exchanging one asset dollars for the equivalent bond value (set by the free market.) The $600 billion the US Gov't borrowed from the private sector (in less than 2 months which is equal to 2% of total US public debt) is now sitting in the TGA ready to be deployed in the next disaster that comes along. Once again proving #MMT WRONG! Gov't does not spend first and taxes later. Once again to be very clear. The US Gov't must first tax and borrow from the private sector before spending. By LAW! Why does all this matter? There are many reasons which I won't go into here. Just know that $600 billion of total deficits this year will simply sit in TGA unless some economic catastrophe comes along before Oct. (The end of the fiscal year for TGA)Longby RealMacro2210
Delinquency Rate On Commercial And Industrial Loans Caution!I expect Delinquency Rate On Commercial And Industrial loans to rise from historically low levels. While that may not appear as a bad thing moving into a more normal territory the impact that it will have may be a lot more than the economy can handle. I can't help but think of Hyman Minsky "Stability is inherently destabilizing" Hyman Minsky Caution is in order!Longby RealMacro4413
SPY - NIKKEI225 - We're In The Great Depression + INCOME DATA Problem with monetary fiscal policy and debasement? your markets start to hyperinflation especially when you try to patch previous bubbles *cough* QT *cough* BTFP *cough* ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- The average net yearly income of Americans during 1930 was $4,887.01 Unemployment Rate (UNRATE) 8.7% AFTER TAX - $4,788 $4,788 in 1930 is worth $87,476.76 today ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- The average net yearly income of Americans during 1933 was $4,218.40 Unemployment Rate (UNRATE) 24.9% AFTER TAX - $4,045 $4,045 in 1933 is worth $94,935.84 today ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- The average net yearly income of Americans during 2023 $74,738. Unemployment Rate (UNRATE) 3.6% AFTER TAX - $57,237 ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- CONCLUSION - The average American is 65.83% poorer than the average American during the great depression. Debasing the currency does not solve poverty and enhances it. All of this data is from the IRS FRED seems to not provide information prior 1960 now you know why they don't include this on the charts. Sadly I feel most people don't understand that what is coming is not a "recession" not a "08 RE crash" its going to be a foundational collapse of the entire US debt system / treasuries / stock markets / credit crisis / liquidity crisis. ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- United States Government Debt: % of GDP 2023 = 133% Japan General Government Gross Debt to GDP 1989 = 65% Federal Debt: Total Public Debt Q1 2023: 31,458,438 or 31.4 Trillion I'm personally putting a target for 2026 for the end of the US currency reserve system The only option here is to either print more 100s of trillions than Weimar Germany Or force the entire US & Allies onto a new dollar that will combine all G7 currencies. Hopefully people can understand why there's so much controversial developments on Russia & BRICS +, this current war is nothing to do with helping another country. Its because BRICS see's the end of the US system and they are preparing for it. (sources) www.irs.gov www.irs.gov Tax rates include normal taxes of 1.5 percent on the first $4,000 of taxable income, 3 percent on the next $4,000, and 5 percent on taxable income over $8,000, plus applicable surtaxes. Last law to change rates was the Revenue Act of 1928.by FederalXBTUpdated 221
Market Insight: Week Ending 21 JulyIn the US: It was quite a week for the US. According to the Bureau of Labour Statistics (BLS) on Wednesday, consumer price inflation slowed to its lowest level since March 2021 at 3.0% in the twelve months to June (vs expected 3.1% ). Core inflation—excludes energy and food—also cooled to 4.8% (vs expected 5.0% ). Additionally, Thursday revealed that the US Producer Price Index (PPI) printed a smaller-than-expected increase. This indicator measures inflationary pressures on the wholesale side: before it reaches the consumer. US wholesale prices rose less than anticipated in the twelve months to June, gaining 0.1% (vs expected 0.4% ), with core wholesale prices—less foods, energy, and trade services—slowing to 2.6% (vs expected 2.6% ). This, as well as softer jobs growth (the US economy added 209,000 jobs in June ), is unlikely to derail the Fed from raising the Fed Funds target rate on 26 July, but casts doubt on the Fed hiking beyond this month’s meeting, despite Fed officials’ forecasts. In the US this week, industrial production is expected to remain suppressed, with US retail sales and housing data also on the radar. While retail sales data are expected to increase from May to June by 0.5%, the YoY measure is anticipated to slow to 1.1% in June, down from 1.6% in May. Regarding housing data, economists are forecasting a correction, with housing starts, building permits and existing home sales projected to come in lower. Overall, though, these releases are unlikely to alter the Fed’s decision to push rates higher by 25bps later this month. Also notable this week, Fed speak will be on pause as Fed officials enter their blackout period (15-27 July) ahead of the Fed rate decision. The US Dollar Index is testing long-term support at 99.67, following a one-sided tumble last week. This could prompt profit-taking this week and see a minor recovery unfold. In the UK: Inflation data is back in the spotlight this week; only this time, it’s June’s inflation numbers from the UK. It is certainly an economic event worth pencilling in the diary this Wednesday at 7:00 am GMT+1. You will recall that UK wages were 7.3% higher (vs 7.1% expected ) in the three months to May, compared to a year prior, and, including bonuses, wages were 6.9% higher (vs 6.8% expected ) for the same period. Although the unemployment rate climbed to 4.0% in May, up from 3.8% in April (median consensus: 3.8%), the latest UK pay data will concern the Bank of England (BoE), which next meet on 3 August. Wednesday’s consumer price inflation data for June, as aired above, will be a key watch this week, with both headline and core measures poised to slow. Headline YoY inflation is expected to cool to 8.3% (median forecast), down from 8.7% in May. YoY core annual inflation is also expected to slow to 7.0% for the same period, down from 7.1%. A marked deviation to the upside in inflation this week would likely seal the deal for a 50bp rate increase. As of writing, short-term interest rate markets are pricing in a 60% probability that the BoE will hike by another 50bps, bringing the Bank Rate to 5.5%. Interestingly, the terminal rate has nudged lower, currently forecasted to reach around 6.18% in early 2024 and remain at this level for most of the year. The GBP/USD surged north last week, adding 2.0%. Key technical indicators suggest the currency pair is overbought (overvalued), with price action also nearing long-term resistance at $1.32. by Aaron-Hill3
The end of the tightening cycle is nighThe decline in the US inflation rate to more than a two-year low, marks a major step towards the end of the Fed’s historic monetary tightening cycle1. We believe key deflationary forces are in play – (1) weaker commodity prices (2) improvement in global supply chains (3) moderation in demand (4) lower inflation expectations. Therefore, the June decline in inflation is just the start of a series of decreases. Softer than expected inflation report As highlighted in the chart below, the details for June were also better than expected with key measures of underlying inflation coming in below forecasts. The inflation report suggests that some of the stickier components of inflation such as used cars and airline fares are also moderating. It’s important to note that most of the rise in the June CPI can be attributed to housing, however because of the way it is calculated it tends to lag current conditions. The S&P Case Shiller Home Price Index which tends to lead CPI shelter by roughly a year, is already flat which highlights US inflation is likely headed lower. Inflation for labour intensive services such as restaurants, recreation and personal care remained higher in June reflecting the pass -through of higher wages and robust services demand2. Potential further softening in the labour market could bring these categories back to target consistent levels. Softening in the labour market was evident in June’s employment report (nonfarm payrolls rose by 209k versus consensus 230k) which was weaker than expected for the first time in 15 months3. US Producer Prices confirmed a similar deflationary theme. The US Producer Price Index (PPI) inflation for June was softer than expected with headline and core PPI advancing 0.1% over the prior month4. Business surveys are also pointing to weakening pricing power, such as the Institute of Supply Management (ISM) services index which ties in with a lower inflation backdrop. US inflation can’t prevent the July rate hike While expectations for the July rate hike of 25Bps remain firmly in place, the market has scaled back expectations for a second hike – with 21bps / 3bps / 3bps of hikes priced for the July / September / November FOMC meetings5. The disinflation trend increases our belief that the Fed is close to, or will be, at the end of the current rate hike cycle. Earnings take centre stage for the next leg of the rally The key question now remains whether the market continues to trade off expectations of an easing narrative. Central bank policy has been the biggest drag for equities last year. The timing of the easing narrative comes at the heels of a volatile Q2 2023 earnings season. The S&P 500 Index earnings in the Q2 2023 are expected to decline 6.8% y/y, worse than the decline of 3.9% in the Q1 20233. This would be the largest earnings decline since the pandemic-fuelled 31.6% y/y decline in the Q2 2020. Earnings will be the key deciding factor for an extension in the current rally. Investors will be keen to hear from management whether they are looking to adopt a leaner cost structure and ways they are looking to remove excess capacity. Investors will be looking for guidance on productivity and efficiency gains rather than the financial engineering we have witnessed over the past decade. This material is prepared by WisdomTree and its affiliates and is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of the date of production and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and non-proprietary sources. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by WisdomTree, nor any affiliate, nor any of their officers, employees or agents. Reliance upon information in this material is at the sole discretion of the reader. Past performance is not a reliable indicator of future performance. by aneekaguptaWTE114
The US Economy Is 25% Of Global GDPThe US Economy Is 25% Of the Global GDP with just 334 million (4.25% of the global population) This is extremely important to understand because it gives you the context required to better understand so many various narratives that are pushed all over media and politics. Here are some examples China has 1.45 billion people (18.5% of the global population) producing $18 trillion (18%) of the Global GDP. India has 1.4 billion people (18% of the global population) producing $3.4 trillion (03%) of the Global GDP. Russia has 146 million people (1.87% of the global population) producing $2 trillion (01.9%) of the Global GDP. BRICS combined has 3.3 billion people (43% of the global population) producing $26 trillion (26%) of the Global GDP. *3.3 Billion people can barely match the economic output of the 334 million people. *The wealthier 3.3 billion people become the more customers the 334 million Americans will have to profit from. As such it is not bad for the US if BRICS could grow their GDP. The complete opposite is true. 334 million Americans will have 10 times more customers who can afford high-end goods and services for more profit. *That means the US $ will strengthen if the BRICS could manage to become wealthier with 5 different political powers looking out for themselves rather than the whole. Good luck with that! *Russia's 1.9% of global GDP is no match for the US's 25% of global GDP, let alone 32 NATO member nations, or the 50 counties supporting Ukraine. Putin has literally committed economic suicide on behalf of all Russians. This is a humanitarian crisis with absolutely no benefit to Russia even if they could conquer Ukraine and all of the former Soviet block. Scorched earth is not conducive to a healthy vibrant economy. These are just a few examples of how this little bit of information can help people better understand the context of silly or accurate narratives that are flying around all over the place constantly that sound good but have no basis in reality. by RealMacro7742