Daily Economic Update: April 22, 2024

Stocks on a 6-day losing streaks, markets repricing the timing of Fed rate cuts (now looking like November), Bitcoin "halving" completed (this reduces the compensation miners receive for solving a challenging mathematical puzzle that allows them to propose a new block - which should slow the supply of Bitcoin and in theory increase the price), geopolitical tensions and tensions on college campuses, U.S. election chatter heating up, would seem to sum up the last week or so.

With Powell's seemingly "hawkish pivot" all of a sudden all the people who were in love with the Fed's forward guidance, dot plot, parading out every Fed President on TV, etc.,  all seem to be saying it's use case has run it's course.  Hmm...sounds familiar, see my commentary on the January 31, 2024 FOMC meeting here.   In it I shared my advice to the Fed:

my advice to Powell is to revisit Robert Greene’s book The 48 Laws of Power with specific consideration to the following of Greene’s laws:

              Law 4: Always Say Less Than Necessary: When you speak, always say as little as possible. The more you speak, the more likely you are to say something foolish.

              Law 5: So Much Depends on Reputation – Guard It With your Life: Reputation is the cornerstone of power. You can influence more people and gain more opportunities with a solid reputation. Therefore, it is essential to protect it fiercely.

              Law 9: Win through your Actions, Never through Argument:  Winning an argument gives you momentary advantage but winning through actions gives you lasting power. Actions demonstrate competence and create value, whereas words, often in arguments, lead to negative emotions and resentment.

               Law 20: Do Not Commit to Anyone: It is the fool who always rushes to take sides. Do not commit to any side or cause but yourself.  By maintaining your independence, you become the master of others.

Good news is there is NO Fedspeak this week as the Fed is on blackout.

On the week ahead GDP and PCE along with Income and Spending.  It's all tech earnings.

Mon: no major releases

Tue: S&P PMI's, new home sales

Wed: durable goods

Thur: GDP,  jobless claims

Fri: PCE

XTOD: Blackthorne: You think this is over?! You think the unprecedented escalation between Israel & Iran will end here—both sides content with flashy but ultimately inconsequential strikes? You're a fool! The rules have changed  Mariko: The Anjin is upset about the falling price of oil

XTOD: Every manager has the same 5 problems:  

- They can't get clear direction

- They need better people

- They lack the budget

- They don't have time

- They won't say "No" 

Fix those first. Everything else is a distraction.

XTOD: If you want to get rich quickly, the biggest factor is luck.   If you want to get rich eventually, the biggest factor is consistency.

XTOD: Complexity is overrated. Simplicity is underrated.  Analytical ability is overrated. Personal behavior is underrated.  Having a high income level is overrated. Inculcating a disciplined saving habit is underrated.

XTOD: A hired man, who is not a shepherd and whose sheep are not his own, sees a wolf coming and leaves the sheep and runs away, and the wolf catches and scatters them. This is because he works for pay and has no concern for the sheep.

https://x.com/Rory_Johnston/status/1781329788776464605

https://x.com/dklineii/status/1781304264754663687

https://x.com/ShaneAParrish/status/1781305975665836525

https://x.com/joyofcompoundin/status/1781167033746341956

https://x.com/lukeburgis/status/1782069567730167855