Rough day for Nasdaq with Nvidia sliding again. Treasuries did little as markets await PCE later in the week and lacked any other real catalyst. In Fedspeak both Goolsbee and Daly were fairly dovish focusing on downside risk from keeping policy rates at their current levels, citing weakening consumer spending and some uptick in jobless claims. For those looking at "weakening" various "surprise indexes" are showing data continuing to miss estimates, or in more economic jargon, various economic surprise indexes are registering their worst levels since 2022. Let's be honest, data misses vs. analyst consensus estimates are likely as meaningless as data misses vs. the Fed's dot plot. Speaking of the Fed I've seen a couple of Fed papers recently that seem to continue to downplay how long inflation has been above target (see XTOD for one of them).
The biggest immediate risks to markets is likely elections, with France and UK elections right around the corner. With France the concern is around deficits and things ultimately becoming something akin to the "Greek Debt Crisis" of the 2010's era.
The 2Y sits around 4.73% and the 10Y around 4.26% as we head into home price data and more Fedspeak today.
XTOD: Apollo’s Torsten Slok: “There is a major gap opening up between the mean and the median of long-term inflation expectations, which means that half of the population has long-term inflation expectations that are dramatically higher than the other half.”
XTOD: Money leaving chips for everything else
XTOD: Higher inflation can lead to greater efficiency. It all has to do with the price dispersion that inflation generates, which might motivate some consumers to search for the lowest prices, increasing competition among sellers. https://federalreserve.gov/econres/feds/inflation-price-dispersion-and-welfare-the-role-of-consumer-search.htm #FEDSPaper
XTOD: "In my experience, high-achievers focus a great deal on becoming the person they want to be at work—and far too little on the person they want to be at home." - Clayton Christiansen
XTOD: I suspect large swathes of people who don’t have kids or who had kids a while ago will have no idea what I’m talking about but youth sports travel teams are killing the American dream! The current trends in how this works are bad for families, bad for social equality, bad for community, bad for public health, and just overall bad. https://t.co/QAOu3Ld0Ue
XTOD: In order to apply most of your energy in one direction, you have to say no to things that a lot of other people say yes to. Most successful people are masters at eliminating the unnecessary from their lives.
https://x.com/lisaabramowicz1/status/1805281454626107810
https://x.com/MikeZaccardi/status/1805249707096060332
https://x.com/FedResearch/status/1805258055103205793
https://x.com/morganhousel/status/1804936522522824744
https://x.com/mattyglesias/status/1805182588690067518
https://x.com/farnamstreet/status/1805358214789116269
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