The much awaited Leap Year PCE data came in slightly above consensus estimates on the core MoM and YoY numbers at 0.42% and 2.85% respectively, the headline numbers were largely in-line. The data shows core services inflation continuing to outpace goods, as that trend/shift continues. Perhaps the outlier was Personal Income at 1.0% for January vs. consensus of just 0.3%. Seems hard to believe inflation will slow if incomes are hanging in there. After all inflation is so under control we're worried about Wendy's "surge-pricing".
Stocks ended the month of February higher while bond yields rose on the month, as the market decreased the timing and amount of 2024 rate cuts. The 2Y is around 4.60% and the 10Y around 4.25%. Remember 10Y under 4% and the 2Y around 4.20% to start the month???, me either.... It doesn't matter just buy Bitcoin.
"..the failure to investigate, after all, everyone was happy. The factories here and there in various cities that turned out the pieces [shitcoins], they made their profits. The wholesalers passed them on, and the dealers displayed and advertised them [all the new ETF players]. The collectors shelled out their money and carried their purchases [virtual wallets] happily home to impress their associates, friends, and mistresses [ex. Crypto Bros and Have Fun Staying Poor]."
"...it was fine until questioned. Nobody was hurt--until the day of reckoning. And then everyone, equally, would be ruined [especially Michael Saylor]. But meanwhile no one talked about it [about how they still can't explain a legitimate use for the coins]...they shut their mind to what they made, kept their attention on mere technical problems [the halving and whatnot]."
- Frank Frink in Philip K. Dick's, The Man in the High Castle on Bitcoin (or on forgeries of pre-war artifacts and Gresham's Law - bad driving out the good and how normative/accepted fraudulent items became)
Speaking of bubbles, a little over a month ago I wrote about "Bubbles" here. As with all of my esteemed content, it tends to go mainstream in due time. Like yesterday when Ray Dalio posted an article titled "Are We in a Stock Market Bubble?" So let's see what Mr. Metrics had to say on the topic, he's never been accused of rigging those metrics anyway, right?
- Dalio defines a bubble as having: (a) high prices relative to fundamentals, (b) unsustainable business conditions, (c) hot money - people buying just because something went up (d) broad bullishness, (e) leveraged purchasers (f) speculative betting on the future by businesses via large forward expenditures.
- He decides that Mag-7 is frothy but not bubbly - and states the obvious that if AI doesn't live up to the hype those valuations could face significant correction.
- Of his aforementioned metrics he mentions that he doesn't believe we are in a bubble because current conditions lack: a broad bullish sentiment, purchases financed with high leverage and buyers/businesses with extended forward purchases.
So there you have it, no bubble. We'll check in with Jim Cramer in a few weeks just to double check.
One stock that definitely wasn't in a bubble yesterday was Chemours, the chemical giant placed their CEO and CFO on leave over accounting concerns and associated concerns about 'tone at the top', that never sounds good.
On the day ahead it's ISM Mfg and Construction Spending.
XTOD {the essence of the compounding equation appears in all aspects of life}: Can you evaluate my workout program? Question 1: "Can you do it consistently & not miss more than 2 workouts a month?" This matters more than frequency, exercises, etc. as it helps determine these and other key variables. This applies even more when evaluating meal plans.
XTOD: In some beautiful version of this universe, @RobinWigg and @CliffordAsness co-wrote this masterpiece of condescension and disgust Crypto factor investing. Really https://t.co/SX4spIWqSq
XTOD: This 1986 CIA analysis on the Japanese government's unwillingness to consider a fiscal expansion that might, among other things, boost Japanese wages while reducing the trade surplus, is absolutely fascinating: https://cia.gov/readingroom/docs/CIA-RDP86T01017R000605930001-7.pdf
XTOD: We also now have four years of data on the elevated share of goods spending and the corresponding decline in the services share. Many economists expected these shares to normalize, but thus far, the goods share remains elevated relative to both pre-pandemic levels and trend. We cannot yet determine whether this is bona fide structural change, or whether the shares will eventually return to their pre-pandemic levels, but either way, it’s been an important and impactful development regarding shifting consumer preferences.
XTOD: Super core PCE inflation EXPLODED higher on a MoM basis to +0.596%, or basically the HIGHEST EVER (showing the @federalreserve is NO WHERE NEAR restrictive, & NO WHERE near its goal of +2%). Yet, the Fed is talking rate cuts, and the market is cheering today's inflation data?
XTOD: What happened to team transitory?
https://x.com/BryanKrahn/status/1762845891667345580?s=20
https://x.com/M_C_Klein/status/1763080236600815960?s=20
https://x.com/WhiteHouseCEA/status/1763208188092944578?s=20
https://x.com/GordonJohnson19/status/1763205161097248796?s=20
https://x.com/Francesco_Bia/status/1762906024367784053?s=20
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