So much for my opinion last week that consumers were still out there spending.
Walmart reported earnings last week, reflecting a lower than expected level for the second quarter.
The impact of food, utilities and gas has impacted those in the lower income brackets as you would expect.
I was surprised last week though that Home Depot had a good earnings report despite the poor home retail market.
It appears homeowners are staying where they are and fixing or improving what they have.
Economics is as dry a subject as you can get, but I find trying to understand what is happening in dollar and cents terms to be engaging.
The obvious answers more times than not are wrong.
We will get plenty to talk about as it concerns the economy with the meetings at Jackson Hole this week with most of
the business leaders in attendance.
The Fed Chair will give a
speech and everyone will try to sense whether there are rate hikes in the future.
I would only say that the chances are far greater for hikes than reductions.
That probably only means that we will stay where we are.
The minutes of the last Fed meeting reflected a split as to whether to raise or hike.
The push up on bond yields has caught everyone’s attention.
The US debt climbed to over $40 trillion.
Should rates go up, it will cost us more to finance the debt.
Of course nothing will get done in DC to address this problem, as all focus is now on the midterm elections.
Moreover, the answer is unpalatable with each side choosing to blame the other, rather than austerity and higher taxes.
Traders are hoping that Nvidia will provide a lifeline for the markets this week.
They report second quarter earnings this week.
With the last couple of weeks on the down side, this market could really use some positive news.
We won’t get it from the conflicts in the Middle East, or any of our various trade flareups.
I understand that we should conduct trade without any tariffs.
Our problem is that we have let other countries impose tariffs on the U.S. for years.
It has always been the US is so wealthy, that it can absorb the cost.
These tariffs have become entrenched and viewed as a right.
It is much like the U.S. providing military cover worldwide.
The problem is that while the U.S. economy dwarfs most of the rest of the world, the price is finally getting to be too high.
Nothing goes on forever but after a while people come to believe it has to.
I would say that we can be distracted from economy and the markets right in front of us with the start of football - and we probably will to a certain extent - that is just fool’s gold.
The reality of higher Treasury yields just won't go away.
The Treasury Secretary tried a curve ball, but it was quickly fouled off.
The 10-year is at 4.75% and has little appearance of dropping.
I will say though that the reports of economic growth are not to be ignored.
You only have to look at the jobs report, inflation numbers and earnings growth in general to be impressed.
This is why I find economics so fascinating.
It is never what is splashed on the cover.
The story is hidden deep inside the text.
