• Tag Archives Consumer Confidence
  • U.S. Economy at Risk from Trump’s Poll Numbers

    A new poll is out from the Associated Press/NORC Center for Public Affairs Research at the University of Chicago. It doesn’t bode well for Donald Trump’s presidency nor for the U. S. economy. Despite Wall Street’s century-old propaganda campaign to convince Washington that it controls the levers to economic growth in the U. S., and thus must be placated on its every desire, informed citizens understand that economic power rests in the hands of the consumer in a nation where two-thirds of GDP is consumer spending.
    Likewise, consumer confidence in the President of the United States impacts one’s willingness to open the purse strings and buy. The thinking is: if the country is headed in the wrong direction, how safe is my job? Perhaps I should stop spending and put money away for a rainy day.
    The new poll shows that 64 percent of Americans disapprove of the job Trump is doing. Particularly troubling for a democracy, 65 percent say he doesn’t respect the country’s institutions and traditions. On specific issues, 66 percent disapprove of his handling of health care; 64 percent disapprove of his handling of climate change; 63 percent disapprove of his handling of foreign policy; 60 percent disapprove of his handling of immigration and 55 percent disapprove of how he’s handling the economy.

    This post was published at Wall Street On Parade on June 15, 2017.

  • Wealth Paradox Not Effect

    US Household Net Worth rose to a record $94.8 trillion in Q1 2017. According to the Federal Reserve’s Financial Accounts of the United States (Z1), aggregate paper wealth rose by more than 8% year-over-year mostly as the stock market shook off the effects of ‘global turmoil.’ It was the best rate of expansion since the second quarter of 2014 just prior to this ‘rising dollar’ interruption.
    At such a high level, though, the ratio of net worth to spending has skyrocketed. That means the so-called wealth effect doesn’t appear to have any effect whatsoever. In Q1 1995, Household Net Worth was a quaint $27.3 trillion compared to $7.6 trillion in (nominal) Final Sales to Domestic Purchasers. That’s a ratio of $3.60 in ‘wealth’ for every $1 in (nominal) spending. The latest estimates now suggest $4.85 in ‘wealth’ for every $1 in (nominal) spending.
    There isn’t even a detectable relationship between growth of net worth and consumer confidence. The theorized channel between asset prices, primarily, and economic growth in boosted ‘aggregate demand’ is through the mood of households. Investors are largely consumers even if clustered toward the upper income strata, so economists believe that higher asset prices increase their confidence so as to loosen their purse strings even if otherwise they might be more cautious about spending.

    This post was published at Wall Street Examiner on June 9, 2017.

  • The Entire System Is Ripping Itself Apart And It’s Going Unnoticed – Episode 1293a

    The following video was published by X22Report on May 30, 2017
    Eurozone economic confidence declines and the economies of the European nations has not improved since the great recession. Consumer confidence is declining. Personal spending tumbles on a year to year basis. Millions of Americans just got a boost int their credit scores, and the central bank is hoping this will allow more people to go into debt. Case Shiler is reporting a surge in home prices in their 20 cities. The corporate debt bomb is ticking and it worse than ever. Trump calls for nuclear option so the government is not shutdown. In Dubai a gold backed cryptocurrency has been launched.

  • Global Markets Mostly Weaker; Fed-Speak, U.S. Jobs Data In Focus This Week

    This is a syndicated repost courtesy of Money Morning – We Make Investing Profitable. To view original, click here. Reposted with permission.
    (Kitco News) – World stock markets were mostly near steady to weaker Tuesday, after the long U. S. holiday weekend. U. S. stock indexes are pointed toward slightly lower openings when the U. S. day session begins. Gold prices are modestly lower in pre-U. S. trading after poking to a four-week high overnight. The gold bulls still have some near-term technical momentum as prices are in a fledging uptrend on the daily bar chart.
    In overnight news, the Euro zone May consumer confidence index came in at -3.3 versus -3.6 in April. The May reading was in line with market expectations.

    This post was published at Wall Street Examiner on May 30, 2017.

  • Deutsche Bank Downgrades European Banks To Underweight

    In what some may find an amusing change in outlook by the bank that less than a year ago was on insolvency’s door, its stock at record lows, this morning Deutsche Bank downgraded its peers, other (ostensibly more sound) European banks, to underweight from benchmark on expectations that fading euro-area growth momentum will weigh on the sector over coming months.
    At the same time, DB strategist Andreas Bruckner also Upgraded energy to overweight from underweight as recent USD weakness points to near-term upside for oil. He also upgraded construction materials to overweight from underweight as the recent correction has gone too far given sector is already priced for severe slowdown in global growth and a sharp rise in U. S. credit spreads even as they have tightened.
    The German bank also downgrades tech to benchmark from overweight given fair price after outperformance and USD weakness, DB notes however that within tech, Deutsche Bank prefers semiconductors.
    It also downgraded airlines to benchmark from overweight, and downgrades consumer durables to underweight from benchmark on expected slowdown in global PMI momentum, fading U. S. consumer confidence and high valuation. Finally, it reduced its underweight in mining as sector is below fair value estimate.

    This post was published at Zero Hedge on May 30, 2017.

  • Key Events In The Coming Quiet Week: US Industrial Production In Focus

    It is a relatively quiet week for economic news in the and Eurozone with focus turning to UK data, Japan 1Q GDP, inflation in Canada & Australia’s employment report. Norway GDP should show continued improvement and the Riksbank proposal on a new policy target will also draw interest. In EM there are monetary policy meetings in Chile, Indonesia, Mexico and Poland.
    The start to the week is even more quiet today with no significant data to highlight, while in the US the May empire manufacturing reading is due along with the NAHB housing market index for May.
    On Tuesday, with little of note in Asia it’ll be straight to Europe where the final April CPI revisions are due in France along with the April CPI/RPI/PPI data docket in the UK. Euro area Q1 GDP and March trade data follows, while the May ZEW survey is also due in Germany. In the US tomorrow we’re due to receive April housing starts, building permits and industrial production data.
    We’re kicking off Wednesday in Japan where the March industrial production print is due. In the UK we’ll get March and April employment data, while April CPI for the Euro area is also due.
    There is no data of note in the US on Wednesday.
    Thursday kicks off in Japan again with the Q1 preliminary GDP report, while in China we’re also due to get April property prices data. In France on Thursday we’ll get Q1 employment data while in the UK we’ll get April retail sales. In the US on Thursday the data includes initial jobless claims, Philly Fed business outlook for May and Conference Board’s leading index for April.
    It’s a quiet end to the week on Friday. In Germany we get April PPI while in the afternoon session we get the flash consumer confidence reading for the Euro area in May. There is no data in the US on Friday.

    This post was published at Zero Hedge on May 15, 2017.

  • Consumer Confidence ‘Steady’ Despite Weak Wages, No Spending, Slow Growth

    Apart from stagnant wage growth, dismal economic growth, and tumbling spending growth, Americans remain ‘confident’ according to University of Michigan. Current conditions fell very modestly but ‘hope’ rose to its highest since January. Inflation expectations were steady (near record lows) but buying climates improved MoM.
    It seems UMich respondents do not care about wage growth (just the Nasdaq)…

    This post was published at Zero Hedge on Apr 28, 2017.

  • Central Bankers Tricks Are Now Being Used Against Them To Bring The Economy Down – Episode 1263a

    The following video was published by X22Report on Apr 25, 2017
    Consumer confidence stumbles and stock market soars. J Crew letting 150 employees go. Housing prices surge in the 20 bubble cities and new home sales surge according to the government. Trump pushing for a corporate tax like Obama. Trump budget for the wall won’t be a problem with the debt ceiling because he will wait until later this year to discuss. Trump is borrowing and creating more bubbles, using the central bankers trick to bring down the market.

  • Consumer Confidence Stumbles As Stock Market Optimism Plunges Most In 15 Months

    After rising almost incessantly for the last few months (post-trump), The Conference Board’s consumer confidence index dropped in April (though remains near decade-long highs) with a notable drop in ‘expectations’ (and business conditions weakening).

    This post was published at Zero Hedge on Apr 25, 2017.

  • Wall Street, Retail Sales and Consumer Surveys

    The Wall Street Journal took note of the decline in retail sales reported by the US Census Bureau last week, headlining:

    The Journal blamed drops in spending at gas stations and auto dealerships.
    Their lead paragraph was emblematic of the stupidity and misleading nature of Wall Street and economic conventional wisdom.
    ‘U. S. retail sales fell for the second straight month in March, -a sign economic growth eased to start the year despite strong consumer optimism and steady hiring.’
    Exactly how did the Journal know that consumer ‘optimism’ was strong?
    Answer: Surveys… particularly the University of Michigan Consumer Sentiment Index, and the Conference Board’s Consumer Confidence Index, also known as the Con Con Con Index. The real function of these surveys is to measure how well they have learned the lessons Wall Street has taught survey respondents. Consumers report not whether they have the wherewithal to spend or not. Instead, they report what they think they should say, based on the stock market.

    This post was published at Wall Street Examiner on April 21, 2017.

  • Key Events In The Coming Week: French Election, Earnings, Manufacturing, Housing

    This week will be dominated by the first round of the French presidential election on Sunday. With the number of undecided voters remaining high, four candidates look set to fight for the two places in the second round on 7 May. On the data side, following China’s strong economic report, attention will focus on US industrial production growth on Tuesday. In the euro area, flash PMIs for April due on Friday could point to moderation. In the UK, retail sales (Friday) should have dropped in March as rising inflation eats into real income growth. On Friday, the World Bank and IMF Spring meetings also start.
    In addition, there are a few scheduled speaking engagements by Fed officials this week, including a speech by Vice Chair Stanley Fischer on Monday.
    Focusing on the US, after lacklustre readings in January and February, industrial production data in March may finally have exhibited the kind of strength seen in the ISM factory index. Output readings early this year were held down by sharp declines in utilities output, which reflected unseasonably warm weather, but utilities output looks set to have jumped noticeably, which should help to drive the headline figure higher. Meanwhile, existing home sales may have climbed in March, although the expected gain was likely due in part to the unusually warm temperatures in February, which boosted demand in that month and may have propelling contract closings higher last month.
    The key this week will be in France on Sunday where the first round of the French Presidential election takes place. Official exit polls are due at 8PM CET. The 11 candidates are then whittled down to two, with the second round runoff held two weeks later on 7 May. On the data front, it looks to be a quiet week. We expect softer numbers in Friday’s flash PMI release while consumer confidence should also moderate.

    This post was published at Zero Hedge on Apr 17, 2017.

  • BofA Finds Surging Consumer Confidence Does Not Result In Higher Spending

    While markets are closed tomorrow for Good Friday, the Census Bureau will release both CPI and Retail Sales data at their regularly scheduled times. And since it will be impossible to trade these numbers as they are released, here is a courtesy advance look from Bank of America which as usual has released its internal debt and credit card data in advance of the government report. What it found is that while there has been a slight improvement to the surprisingly poor data from recent months, it is nowhere near what one would expect based on near record consumer confidence surveys.
    As BofA’s Michelle Meyer writes, according to the BAC internal card data, consumer spending improved in March relative to the weak pace in February. The bank’s estimate of retail sales ex-autos, derived from the aggregated credit and debit card data, increased at a 0.4% mom seasonally adjusted pace in March – the highest print in nearly a year – even as gasoline prices declined on a seasonally adjusted basis in March. While Meyer notes that this points to “healthy growth in core control retail sales released by the Census Bureau on Friday”, she cautions that “the gain may not be quite as strong given that the BAC data had been trending below the Census and was therefore due for a bounce higher.”
    Furthermore, the monthly pattern has been particularly noisy of late – sales fell sharply in December (-0.9%), rebounded in January (1.6%) but slipped lower in February (-0.1%). There gave been a number of ‘special factors’ which influenced retail sales, including the timing of the Christmas and New Year’s holidays and the delay in tax refunds which likely delayed spending from February to March. Therefore
    it is prudent to smooth through the wiggles – on a three-month moving basis, retail sales ex-autos are up 0.6% mom, while retail sales ex-autos are up 4.5%

    This post was published at Zero Hedge on Apr 13, 2017.

  • Hedge Fund CIO: “What If The ‘Trump Earnings Surge’ Was Just An Illusion?”

    We bring readers this follow-up note to our earlier quote from the latest Weekend Notes by Eric Peters, CIO of One River Asset Management, as it provides a glimpse into the process of cognitive disappointment many other market participants may soon encounter, once the following key question is asked, and answered: ‘What happens if Trump can’t cut corporate taxes? What happens if we’ve recalibrated earnings to a future that was just an illusion?’
    ‘How’s he going to cut taxes and make it revenue neutral?’ asked the CIO. ‘How’s he going to do massive infrastructure when we’re so deep in debt?’ he continued.
    ‘And why is the yield curve flattening? Why is loan demand declining? Why is consumer confidence at historic highs while retailer stocks are getting demolished?’ He paused to catch his breath.
    And still panting asked, ‘What happens if he can’t cut corporate taxes? What happens if we’ve recalibrated earnings to a future that was just an illusion?’

    This post was published at Zero Hedge on Apr 2, 2017.

  • High Number Of Consumers See Stock Rally As “Sure Thing”

    The percentage of respondents in UM’s survey of consumers who view a stock rally over the next 12 months as a ‘sure thing’ is near record levels.
    Most folks are familiar with the University of Michigan’s monthly consumer confidence survey. What they may not know is that the survey respondents are asked a whole host of questions. One of these questions pertains to their outlook on the stock market. Specifically, they are asked to guess as to the ‘Probability of Increase in Stock Market in Next Year’. Respondents’ answers are broken down into ranges of probability percentages, e.g., ‘1%-24%’, ‘25%-49%’, etc. One of the answer options is ‘100%’ probability of a stock market increase over the next year. We like to track this statistic as a measure of public sentiment towards stocks. And based on the most recent survey, as of February, the public is relatively quite certain about the prospects of a stock market rally.
    We say this because the percentage of survey respondents in the ‘100% probability of a stock market rally’ category came in at 11%. For context, since the inception of the survey question in June 2002, there has been just one month which saw a tally exceeding 11% and just 3 others equaling that high of a number.

    This post was published at Zero Hedge on Apr 2, 2017.

  • Are Markets Overlooking A Clear & Present Danger?

    There is in interesting dichotomy currently occurring within the economy. While consumer confidence, as reported by the Census Bureau, soared to some of the highest levels seen since the turn of the century, the hard economic data continues to remain quite weak. As noted by Morgan Stanley just recently:
    ‘Compare the New York Federal Reserve Bank’s current 1Q GDP tracking vs ours – FRBNY is currently tracking 1Q GDP at 3.0% versus us around 1%. The difference is larger than usual and is being driven by the fact that the New York Fed incorporates soft data into its tracking (attempting to tie it econometrically to GDP, a very hard thing to do especially in real-time). Our method translates the incoming hard data into its GDP equivalent. Note that the Atlanta Fed’s GDPNow tracking also focuses on hard data and is currently tracking 1% for 1Q GDP.’
    The stunning divergence can be seen in the chart attached to that same article which shows the difference between the ‘hard’ and ‘soft’ data specifically.

    This post was published at Zero Hedge on Mar 30, 2017.

  • The Central Banks Begin ‘Operation Frothy’, Systematically Bringing The Economy Down – Episode 1241a

    The following video was published by X22Report on Mar 29, 2017
    UK triggers article 50. Greek deputies will need to cut the salaries. Consumer confidence being faked by the conference board, Gallup shows the complete opposite. Minimum wage hiked in St. Louis which in turn cause more people to lose jobs. How many jobs do robots destroy, the answer might suprise you. Pending home sales surge, but from the past history most of these homes are cancelled. Obamacare might explode on May 22. Government shutdown odds move to 40% according to Deutsche Bank. The various Fed office around the country report that the market is to frothy and we need many rate increases during the course of this year. This operation will bring down the economy

  • Gartman: “We Have No Choice But To Be Bullish Of Equities”

    So much flip-flopping from Dennis Gartman in just the past week, it is enough to make one’s head spin.
    After missing Friday’s move lower, on Monday morning Gartman said he was actively looking to “re-establish net short positions” when S&P futures were sharply lower to which we said “at the rate the S&P is covering its opening losses, he should be able “find a point” where the S&P turns green, and “reestablish shorts” on very short notice.” Indeed, in just a few hours the S&P covered its entire move lower, and provided Gartman with ample opportunity to become short again. Of course, the very next day, US equity markets soared allegedly on the best consumer confidence print since 2000, and following the biggest two day drop in the VIX in years.
    So where is he now? As he says in his latest letter, “We have no choice but to follow the ‘lead’ from the CNN Fear & Greed Index and to be bullish of equities.”
    Here is how he explains this latest momentum chasing:
    STOCK PRICES… EVERYWHERE… ARE HIGHER AND SHARPLY SO as all ten of the markets in our International Index have risen. This is a rare event and historically such unanimity amongst our ‘universe’ of markets has marked important panic tops if this has happened after extended bull runs, or has marked important panic lows at the end of extended bear runs. Certainly this is not the latter. We obviously have considered the markets overextended to the upside and have been reticent about buying into them aggressively. As we said the other evening when on CNBC’s ‘Fast Money,’ and as we’ve said countless times here in TGL, this is a bull market and in a bull market one can have only one of three possible positions: Very, aggressively long of equities on balance; pleasantly long of equities on balance or, finally, neutral of equities, and there is no question but that we’ve tended to err upon the latter two positions and ‘Err’ is the proper word here for we have indeed erred.

    This post was published at Zero Hedge on Mar 29, 2017.

  • The Push To Expose The Secret Inner Workings Of The Fed Is Underway- Episode 1240a

    The following video was published by X22Report on Mar 28, 2017
    Consumer confidence soars to highest since the dot com bubble and we know what happened a short time later. Case-Shiller reports that home prices have soared in its 20 cities, while mortgage apps are declining. Property taxes hit an all time high. NYC retail vacancies have soared and there are no takers. Exports and Imports decline, more signs of a weakening economy. The central banks have used all their ammunition to keep the economy together, it is now slipping through their fingers. Wall Street might not be prepared for a government shutdown. The house passes a bill to audit the fed, next phase, all the entire house floor to vote on the bill.

  • The Last Time Americans Felt This Good About Stocks, The Dot Com Bubble Burst 2 Months Later

    Earlier today we noted that overall US Consumer Confidence, at least according to the Conference Board, smashed expectations and rose to the highest level since 2000.
    The recent euphoria about the US economy is likely a continuation of the record partisan split, in which republicans love the current state of the economy, while democrats are convinced the US is facing an imminent collapse. Recall what UMich said just a few days earlier, when it took reported a near record confidence print:

    This post was published at Zero Hedge on Mar 28, 2017.

  • “They ‘Buy The Dip’ Yet Again”: Global Stocks, US Futures Rebound; Dollar Rises Off 4 Month Lows

    European, Asian stocks have rebounded as investor anxiety over Trump economic policy and US tax reform eased following yesterday’s remarkable comeback in the US market. S&P futures point to a slightly higher open, with oil higher and the dollar rebounding off fout month lows. It is a relatively quiet day in the US with the economic calendar focusing on wholesale inventories, consumer confidence and the Case-Shiller index.
    European and Asian equities rose and S&P 500 futures edged higher as investor bullishness returned after the failure of U. S. President Donald Trump’s health-care bill. Hopes that the Trump administration will now prioritize tax reforms coupled with still-robust economic data and corporate earnings forecasts spurred some investors to look past creeping doubts about Trump’s ability to deliver on campaign promises.
    According to Bloomberg, the resumption of demand for risk assets signals investors are still pinning hopes on Trump’s ability to push through tax cuts and regulatory changes, pledges that helped trigger a reflationary upswing in global markets after his election. “Bond and FX market participants’ reaction to the failure of the health-care bill has been to re-price Treasuries and the dollar under the assumption that President Trump has lost a little of his shine,” Kit Juckes, a London-based global strategist at Societe Generale SA, wrote in a note.

    This post was published at Zero Hedge on Mar 28, 2017.