evening wrap

market vibes

January 14… 6:29 EST )

“What’s beautiful is all the counts, Pal. It’s all that counts.” Jack Nicholson 2003, in a rehearsal before his last live gig.

It was not a very telling day for anything in New York today. Narratives focused on the fire and politics. Inflation in Japan is heating up. China said they would keep the Yuan from crashing for as long as possible. Trump announced the “External Revenue Service,” about which few knew quite what to say. So it passed unchecked at the border without a hitch.

PPI came in dovish. Final demand, less food, energy, and trade services (chart below). Expectations were 0.3%, actual 0.1%. This is a common pre-COVID reading.

Bonds made new lows and closed on a new low. Higher rates are definitely suppressing inflation… but inflation is not causing higher rates.

Bonds are falling because there are too many of them, and many more are coming to market, both public and corporate. Looking at the schedule ahead, a 5% thirty-year T-bond looks cheap.

S&Ps, bitcoin, gold, oil and natty… plus charts and comments and the vibe ahead. Here we go.