Well if 2% didn’t work then 3% has got to be better…. Inflationista heads exploding today on this news…
David Reifschneider and David Wilcox, both ex Fed senior economists, make the case for a 3% Fed inflation target. https://t.co/O05TEbs2AZ via @PIIE
— David Wessel (@davidmwessel) August 16, 2021
He who laughs last, laughs best.
ReplyDeleteLast year obviously didn't count. That's like picking a needle in a hay stack.
I'm just a little early. It's the 1st two weeks of Sept. that counts.
As I said:
(biggest drop to not happen until Sept).
It's based on AD, money flows;
1/1/2021 ,,,,, 0.65
2/1/2021 ,,,,, 0.66
3/1/2021 ,,,,, 0.70
4/1/2021 ,,,,, 0.71
5/1/2021 ,,,,, 0.78
6/1/2021 ,,,,, 0.80
7/1/2021 ,,,,, 0.88 top
8/1/2021 ,,,,, 0.66
9/1/2021 ,,,,, 0.36 bottom
The biggest delta is between Aug. and Sept.
It's all about the 10-Year Treasury Constant Maturity Rate (DGS10):
fred.stlouisfed.org/...
Yields bottomed on the 4th
2021-08-04 1.19
2021-08-05 1.23
2021-08-06 1.31
2021-08-09 1.33
2021-08-10 1.36
2021-08-11 1.35
2021-08-12 1.36
If yields fall back, then stocks will move back up.
inflation has peaked the second derivative is a rate of a rate. If inflation has peaked, it means that the rate of increase in inflation will subside. I.e., instead of increasing, the rate of increase will decrease.
MMT is bogus. Those advocates don't know a debit from a credit. MMT creates negative real rates of interest, and negative real growth.
https://seekingalpha.com/user/7143701/comments
Salmo Trutta.
Negative Real Rates Of Interest
ReplyDeletehttps://seekingalpha.com/instablog/7143701-salmo-trutta/5341967-negative-real-rates-of-interest
It's not like 1999. Money flows accelerated in 1991. They peaked with total legal reserves in Jan. 2000.
ReplyDelete1999-11-01 41.0
1999-12-01 41.7
2000-01-01 44.2 spike
2000-02-01 42.1
The DJIA peaked @ 11,722.9 January 14, 2000.
It's my experience that the most dominate economic driver is money times velocity, AD.
The O/N RRP facility is draining reserves and the money stock. And the rate of change in money stock growth has slowed, bank credit has slowed, so the FRB-NY's trading desk is doing most of the lifting. That plus the average balance of bank customers have dwindled considerably.
"Within 10 days of receipt, those who had received the stimulus payments had spent $600 more than those for whom the check hadn’t yet appeared."
Huge drop in bond prices, therefore the drop in precious metals. Because the rate of change in money flows drops in September by more than 13% (only 5% is necessary for a short-term short-selling trade.
1/1/2021 ,,,,, 0.65
2/1/2021 ,,,,, 0.66
3/1/2021 ,,,,, 0.70
4/1/2021 ,,,,, 0.71
5/1/2021 ,,,,, 0.78
6/1/2021 ,,,,, 0.80
7/1/2021 ,,,,, 0.88 top
8/1/2021 ,,,,, 0.66
9/1/2021 ,,,,, 0.36 bottom
An actual crash (without FED intervention), not just a small sell-off, is possible in FEB-MAR 2022. You should be short commodities at the start of 2022 as inflation has peaked.
Salmo Trutta......
Next seasonal inflection point is ......
ReplyDeleteSeasonal inflection points (they may vary a little from year to year):
Pivot ↓ #1 3rd week in Jan.
Pivot ↑ #2 mid March
Pivot ↓ #3 May 5th
Pivot ↑ #4 mid-June
Pivot ↓ #5 July 21st
Pivot ↑ #6 2-3 week in October
Around the middle of October....
https://seekingalpha.com/instablog/7143701-salmo-trutta/5308783-6-seasonal-inflection-points
It is all pointing to the first seasonal inflection point next year.
ReplyDeleteIs where without a good boost in spending or if spending starts dropping in the last quarter things are going to get interesting.
Everything will align at the end of Jan start of Feb the 5th Elliot wave inflection point between October 21 and Jan 22. Exactly What happened on July 19th this year the 5th seasonal inflection point.
Only the downturn produced by this inflection point could be much, much, much bigger.
All the Monetarists that follow the flows in a different way say so. Start of 2022 is flashing RED.
Be interesting to see how it plays out.
That is why everyone was right in July it came 2 days early than The
ReplyDelete5 th seasonal inflection point.
The seasonal inflection points are the pressure points. However, they are to be ignored unless things align correctly.
What those that front run the market and Monetarists use is Elliot wave analysis between each seasonal inflection point. They use that to determine if the stars have aligned or not. Measure the liquidity in the markets between each seasonal inflection point and if they are at wave 5 or not.
* I think * after following them for a while now but not 100% certain.
Salmo is different uses the same Elliot wave technique and seasonal inflection points. How he measures liquidity is completely different to other Monetarists. Because he says the lags in the flows are constant and have been for a 100 years he can predict the futute.
Hence his prediction of the 13% drop in AD money flows in Sep and why he says inflation has already peaked and now in a rate of change downtrend.
He is not interested in government spending whatsoever only bank lending. Says government spending has a negative multiplier.
Which is why I was shocked so many people that look at the flows in different ways called the market correction in July right by within 2 days.
Shocked I tell thee shocked.
“ called the market correction in July ”
ReplyDeleteA 1% drop isnt a correction… what correction the market is at all time highs?