Strategic Global Intelligence Brief for November 9, 2018

Short Items of Interest—U.S. EconomyWhy Midterms Likely Mean a Booming Retail Season There are multiple reasons why this holiday retail season is likely to be great, but there is one key reason why it could blow the door off of records. First, let's state the obvious reasons why this year's retail season could be a record-breaker:GDP trending near ...
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Strategic Global Intelligence Brief for November 7, 2018

Short Items of Interest—U.S. EconomyThe New Political Reality It looks quite a bit like the old political reality, but with some new wrinkles that will play a bigger role as 2020 gets closer. By now, you have heard the major stories—the Senate is more firmly in the hands of the GOP with the loss of three Democratic incumbents. The House is now in t...
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Strategic Global Intelligence Brief for November 5, 2018

Short Items of Interest—U.S. EconomyHiring Is Up and so Are Wages The latest jobs report showed some movement as far as wages are concerned. This has been long overdue. It is not the rocket speed some had feared and there is still relatively little pressure on wage inflation, but a least there are gains considered near normal. The fact is there are...
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Strategic Global Intelligence Brief for November 2, 2018

Short Items of Interest—U.S. EconomyLabor ReportThere were some aspects of the latest labor report that were eagerly awaited. For the most part, the news has been better than many had expected. The wage hike most had been expecting did indeed materialize with a 3.1% annual rate. That is as good as has been seen since the start of the recession. The...
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Strategic Global Intelligence Brief for October 31, 2018

Short Items of Interest—U.S. EconomyConsumer Confidence at 18-Year High The latest numbers from the Conference Board are out and are quite a surprise. They might not be all that indicative of the real mood of the U.S. consumer, but they are astonishing. By now, readers of this newsletter know I do not place much stock in consumer confidence numbers...
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Strategic Global Intelligence Brief for October 30, 2018

Short Items of Interest—U.S. EconomyInflation Remains Tepid There are many ways to measure inflation. Some are more variable than others. Economists are often dinged for the way they treat core inflation numbers. We routinely ignore the price of fuel and food as these can be very volatile month to month. It's hard to make accurate assessments of ho...
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Strategic Global Intelligence Brief for Oct. 26, 2018

Short Items of Interest—U.S. EconomyConsumer Sentiment Up but Not as High as BeforeThe level of consumer confidence has been elevated all year. This is better than it being lower than usual, but given that consumer confidence surveys can be notoriously fickle it is hard to really understand what they are indicating. This month, the level of confide...
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Strategic Global Intelligence Brief for October 25, 2018

Short Items of Interest—U.S. EconomyGovernment Spending Pushes Economy Forward Specifically, it has been the rise in defense spending that has done the propelling. The increase was due to an increase in the purchase of aircraft and aircraft parts. This is one of the largest gains in years and has been attributed to the heavy use of air power in mos...
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Strategic Global Intelligence Brief for October 24, 2018

Short Items of Interest—U.S. EconomyU.S. Selling Fewer Treasuries This hardly qualifies as a crisis yet, but it bears watching. The share of foreign investment in U.S. bonds has rarely been this low. It stands at 41%. Even as recently as two years ago, the percentage was 50%. The yields for U.S. treasuries have been generally down—the 10-year bond ...
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Strategic Global Intelligence Brief for October 22, 2018

Short Items of Interest—U.S. EconomyBarriers to Higher Wage Growth There has been something missing as far as the economy has been concerned. The issue has been persistent enough to create some real issues. Every study of the economy over the last several decades has revealed a logical connection between the levels of employment and wages. The logi...
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Strategic Global Intelligence Brief for October 19, 2018

Short Items of Interest—U.S. EconomyRecession and Employment It is a safe bet that at some point the U.S. will be contending with another recession—although there is a lot of disagreement as to when that might take place and how bad it will get. The arrival of even a mild recession will have an almost immediate impact on jobs as there will be compa...
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Strategic Global Intelligence Brief for October 18, 2018

Short Items of Interest—U.S. EconomySlumping Housing Market The slide continues as far as the housing sector is concerned. Both starts and permits are down—starts fell by over 5%. This is not taking anybody by surprise as most had expected to see this kind of decline some months ago. It seems to have taken a little longer than expected for the head...
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Strategic Global Intelligence Brief for October 17, 2018

Short Items of Interest—U.S. EconomyMore Job Openings than Applicants This is record territory as far as the job market is concerned. There are reported to be seven million job openings and roughly six million people looking for work. If every unemployed person was subsequently employed, the business community would still be short by a million. Giv...
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Strategic Global Intelligence Brief for October 16, 2018

Velocity of Money and the Connection to the Economy There is a fundamental premise in economics that the faster money changes hands, the better the growth of the economy should be. In our view, when you look at the velocity of M2, you get a fair representation of what is happening to the velocity of economic activity. A debate is raging among econo...
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Strategic Global Intelligence Brief for October 15, 2018

Short Items of Interest—U.S. EconomyFed Reiterates Intent It is not at all clear what the motivation is behind the latest tweet storm aimed at the Federal Reserve, but if it was expected to evoke a change in the policy of the Fed, it has not had the desired effect. The Fed has essentially circled the wagons and reiterated what it has been saying al...
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Strategic Global Intelligence Brief for October 12, 2018

Short Items of Interest—U.S. EconomyWhere Is the Consumer Inflation? The latest edition of the Consumer Price Index came in lower than had been expected with a very meager 0.1% rise. It is not that the analysts thought there would be some huge jump in prices, but there has been more than enough evidence to suggest consumers would be feeling the inf...
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Strategic Global Intelligence Brief for October 11, 2018

Short Items of Interest—U.S. EconomyReactions to Global Tension The global markets have been roiled quite a bit in the last few days. This is likely to become a pattern in the weeks and months ahead. The sense is that markets are now expecting something bad to develop as a result of political tensions. Almost anything will do as a spark to evoke pa...
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Strategic Global Intelligence Brief for October 9, 2018

Short Items of Interest—U.S. EconomyAvoiding Tariffs 101 It turns out that setting tariffs on imported goods can be a very tricky proposition. The way to do this is to impose these taxes on select goods as defined in the HTS [Harmonized Tariff Schedule] code. This system has 18,927 different entries that attempt to catalog and define every single t...
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Strategic Global Intelligence Brief for October 8, 2018

Short Items of Interest—U.S. EconomyConcern Grows as Regards Inflation The rate of unemployment is as low as it has been since 1969. That has the bond markets worried that at some point the inflation issue is going to become real. The threat has yet to manifest as expected, but that certainly doesn't mean it will not in the months ahead. The sense ...
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Strategic Global Intelligence Brief for October 5, 2018

Short Items of Interest—U.S. EconomyCan You Say Tight Labor Market? The unemployment rate has fallen to the lowest point since the days of the Vietnam War. Back in 1969, the rate was very low in part due to all the men who had been drafted into the military, but that is not a factor this time. Even though the number of new hires was down a bit from...
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