The Economy: The week’s economic highlight was Wednesday’s release of the Fed’s Beige Book. It showed moderate growth and little inflation. Lower demand in the economy is discussed as being the result of higher healthcare deductibles for consumers. More out of pocket for healthcare means less available for other spending. The Fed remains on track to again raise rates in December. The Beige Book was almost an afterthought to a week of upbeat economic news: Low inflation; retail sales up; manufacturing up; global stocks reaching record highs; investors pouring money into stocks; Industrial production up; housing up; Philly Fed Index up; Bloomberg Consumer Sentiment up. What’s not to like?
Food for Thought: My good friend Sam commented that my “More Money” email appears to be increasingly amazed at the non-stop rampaging bull market. He’s right. … You can slice and dice the metrics, the geopolitical environment and every conspiracy theory out there. Compelling arguments abound. To rest easier and become one with nature, simply accept that stocks will continue to go up until they don’t.
Music of The Week: Ziggy Marley’s “Conscious Party”
We Quarterback Money®
The Economy: The Fed’s Beige Book, a measure of the national economy, was released last week. It showed a soft economy. The preamble was optimistic but the details were less so. Combined with the economic hit form Harvey and Irma, the Fed is likely on hold through year end. This continues the “lower for longer” interest rate scenario we had for the past several years. The hurricanes have dominated the headlines for the past week. NAFTA, the White House half-life of Gary Cohn and North Korean threats have faded to black … at least for the moment. Since the world didn’t end with either NOKO’s nuclear war threats or the hurricanes, stocks are again on a rocket-ride to infinity and beyond. This despite comments by the following scaredy cats: 2017_09_06: Deutsche Bank Chief Executive Officer John Cryan “We’re now seeing bubbles everywhere”; 2017_09_06 Lloyd Blankfein, CEO, Goldman Sachs: … (world financial markets) “have been going up for too long”; 2017_09_11 Seth Klarman of Baupost Group: “… plans to return capital to investors by year-end due to a lack of opportunities”; 2017_09_12 John Hussman of The Hussman Funds: “I view the market as having no investment merit at all here.” Like I said, scaredy cats! They should be tarred, feathered and run out of town on a rail for thinking that stocks could possibly do anything other than go up forever.
Food for Thought: Taki Magazine reports that in a tip of the hat to globalism, multiculturalism and identity politics, “… the British Broadcasting Company (BBC) has launched a website in Pidgin English. The BBC points out that Pidgin English is ‘an informal lingua franca. It is a language that really unites people and cuts across all sorts of barriers—ethnic, regional and socio-economic.” The new site’s headlines feature Pidgin droppings such as “Indian woman divorce husband because dem get no toilet,” “Why dem dey call Hurricane human being name,” “How Tanzania dey kill mosquito,” and our personal favorite, “Why China dey chop African Donkey.” Nothing new here. Anyone who’s had children in school recognizes this patois as proficient english for graduating seniors. Next up, Gullah.
Music of the Week: Bruno Mars’ “It Will Rain”