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Some naysayers believe that the USA is running a giant economic confidence game, much like the rest of the developed world. I say that could not be further from the truth. Just because we apparently require interest rates to continually fall over the long-term and we're currently stuck to the floor at the short end, it doesn't necessarily mean there's anything to be alarmed about. This could be all perfectly normal.
There's only one thing that would alarm me. I'd need to read a news article that tried to tell me that the only economic report that matters is the one regarding consumer confidence. Since when is consumer confidence a good predictor of future economic activity? That data's just staring right into the rear view mirror. If times were recently good, then people are generally happy. See how that works?
A confidence report is the only report that a confidence game would need to thrive. I can tell you with 100% confidence that nobody will ever suggest that it is the only report that matters. Not going to happen! So we can all just take a deep breath and sigh in relief. This economy is strong, resilient, and built upon the sturdiest of foundations. We don't need to rationalize it by ignoring all the awesome objective economic reports and dwell on one consumer confidence report in their place. That would be crazy talk for an economy as strong as ours.
January 27, 2015
Only One Of Today's Flood Of Economic Reports Really Matters
The market is freaking out over the slew of negative economic data this morning, but let's be real: that great consumer confidence report is the only one that actually matters.
Oh f%#k! It's the g#%^**% f%^king end times!! Why didn't someone warn me?
Hey. It isn't as bad as I thought. This person claims the market is freaking out. Well, I just checked the market and everything seems pretty good to me. That's right. Treasuries are doing fine. Oh, wait. Do you suppose the person meant the stock market? Should have been more specific. I know that many seem to think there's just one market but this only adds confusion and fear for those who know there are more than one. Confusion and fear cannot stop a panic. I thought everyone knew that.
Freaked me out big time to think that the only market that matters to me was freaking out. I almost dumped my long-term inflation protected treasuries and piled into the safe haven that is the USA stock market. Only goes up I'm told. There are no other safe alternatives.
Thursday: Unemployment Claims, PPI, Fed Chair Powell
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[image: Mortgage Rates] Note: Mortgage rates are from MortgageNewsDaily.com
and are for top tier scenarios.
Thursday:
• At 8:30 AM ET, The *initial weekly ...
6 hours ago
10 comments:
Mark
Wonderful Sarcasm, if somehow you could work that hedgehog in this that would be the end. You must be a really funny guy in person.
That's weird he picked consumer confidence. I am sticking with that proven bell weather Calculated Risks prefers, the Chemical Activity Index. That must the only one that matters.
Anonymous,
Would you settle for a hedgerow? Crashin' and tankin' for the allied win! ;)
Rhino Tank
An M4 Sherman-based United States Rhino tank crashes through a hedgerow.
Mr Slippery,
I won't even leave the house without consulting the Chemical Activity index first! I mean, really. Do I need an umbrella or not? And if I do, will it be good enough to protect me from our strong manufacturing economy's acid rain?
I fear that the index doesn't fully capture my recent app purchases though. How many chemicals were needed to send the data to me over the Internet? And if I stop, so too the chemical rain?
What I really want to find is the Couch Potsto index. The higher it goes, the worse Sears and Radio Shack will do. As I'm laying there on the couch, I just can't seem to ever get enough Sears and Radio Shack apps. Well, that and addicting iPhone games, lol. Sigh.
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=LUV&insttype=Stock&freq=2&show=&time=20
I am in luv with parabolic stawks!!
Insider direct buys and sells of LUV last two years.
Summary (Direct Transactions
Total Shares Bought 5,000
Total Buy Value $102,299
Total Shares Sold 1,656,134
Total Sell Value $41,150,240
End Date 2014-01-28
John,
LUV is sure loving the drop in oil. As a party pooper, I wonder how much the price of fuel was already hedged and/or how long airlines can keep fares high before there's yet another bidding war between carriers.
I saw a survey that showed price was by far the most important thing to air travelers. One way to get people to fly your planes more would therefore be to lower the price. However, when everyone lowers the price there's the shareholders won't be getting the good deal. The customers will.
Just a thought.
It reminds me of the first major grocery chain to stay open 24 hours. It was probably a huge boost to the bottom line. There's little boost now though. Most major grocery chains now do it (at least in my neighborhood). The boost was mostly temporary.
Put another way, there's only so long you can take customers from your competition before the competition starts doing what you are doing.
It will be interesting to see if airlines will play nice with each other or one will lower fares in response to falling oil prices.
I strongly suspect the latter. I would guess it will start with a small carrier undercutting, on the hopes that the bigger carriers won't respond in kind. Over the long-term, good luck on that.
I definitely would not invest in airlines just because the price of oil has fallen, especially once many have already piled in. I think the LUV parabola, like all others before it, will eventually end in tears. I do not see how a fallen oil price can permanently raise profit margins. Let's just put it that way.
Strange bubble twins:
http://stockcharts.com/c-sc/sc?s=LUV&p=D&yr=1&mn=0&dy=0&i=t88235414838&r=1422477451730
John,
Warren Buffett once joked that he wanted a special 1-800 number that he could call if he ever wanted to invest in airlines again. The goal would be to talk him out of it, lol.
Planes have been around for a century. Perhaps it is different this time. Heck, maybe they'll even bring the Concorde back. In any event, I shall pass.
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