Weaning Ain't Fun!

Well, dang! 

Thanks – more than anything else -- to threats of a global trade war, stocks essentially missed out on (unless of course we see a big advance as we close out April) what was a really nice setup going into the seasonally-special March/April period. I.e., having just suffered through the first 10+% correction since early 2016, the market was ripe for a rally as it entered the historically two best months of the year.

This Week's Message: Should We Fret The Yield Curve?

As we've been reporting, our analysis of current conditions suggests very low risk of recession on the near-term horizon. However, to some, one popular economic indicator -- one that happens to be an important input to our weekly analysis -- is flashing red! That would be what's called the treasury yield curve. 

Quote of the Day: The Post Office Needs A Large Dose of the Free Market

Ironic how the U.S. Postal Service remains mired in government bureaucracy while Germany and Britain turned theirs over to the private sector, and they're fixed.

One Example of Why Tariffs Really Bug Me!

A friend, and BTL reader, told me recently that in reading the blog he senses that talk of tariffs for me is akin to someone scraping their fingernails on a chalk board.

I must confess, he was spot on!

This morning's Empire State Manufacturing Survey release gives you one reason (among multiple) why:  emphasis mine...

note: Paragraph 3 supports our bullish view of current conditions; paragraph 1 explains why we stressed at the beginning of the year that protectionism poses the greatest threat to our thesis...

This Week's Message: Long-term trend intact, short-term setup in question...

Bringing you this week's message early, as I'll be away from the office Tuesday through Friday (what'll you do with all that extra reading time?). 

While recent volatility has delivered some short-term technical damage to equities, the longer-term bullish trend remains intact; per the three long-term trend indicators (the slope of the S&P 500's 200-day moving average, the positioning and slope of our weekly moving average indicator, and the signal indicated in our monthly Bollinger Band chart) featured below: 

From Our April Current Trends File

The entries thus far to our April current trends file pretty much jibe with the latest reading from our macro index. 

In a nutshell: Under the weight of rising geopolitical uncertainty, global trends are not what they were a few months ago. The U.S. economy nonetheless remains in good shape with probabilities pointing to no recession on the near-term horizon. In the meantime, inflation is picking up at a healthy enough pace to justify at least 3 Fed rate hikes this year. 

Stat of the Day: Workers! Workers! Workers!

You and I can have a legitimate debate about the good and bad of employment trends in manufacturing. And we can legitimately debate the quality of jobs available across all sectors. But, frankly, there's no debating the fact that the U.S. economy is in no way shape or form wanting for job opportunities.