Inflation dropping like a rock

2lion70

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Inflation is starting to 'drop like a rock' leading to deflation in certain areas of the economy, Fundstrat says​

mfox@businessinsider.com (Matthew Fox) - 6h ago
Inflation is starting to "drop like a rock" rather than a feather, leading to outright deflation in some areas of the economy, Fundstrat's Tom Lee said in a Wednesday note.

A slowdown in rising inflation would be welcome news to investors given that the stock market has sold off 5% since Fed Chair Jerome Powell's hawkish speech at Jackson Hole last week.

Powell reiterated the Fed's resolve to tame inflation by being aggressive with interest rate hikes and a reduction to its $9 trillion balance sheet. The market currently expects another outsized 75 basis point rate hike from the Fed at its FOMC meeting in late September.

If inflation cools and is less "sticky" than most expect, it could change the Fed's current interest rate hike trajectory, ultimately leading to a faster pivot towards a pause in rate hikes. That would be a boon for risk assets, which have been stymied in recent months by fast rising interest rates.

And according to Lee, inflation is quickly cooling.

"42% of CPI components are declining from recent highs = deflation," Lee said, adding that five of the nine US regions saw outright deflation in July on a month-over-month basis.

"These 5 regions represent 49% of GDP. In East North Central, CPI annualized is -3.96%, outright DEFLATION," Lee said.

Additionally, leading inflation indicators like used auto prices, airfares, and real estate "suggest many other components of CPI could start falling outright," according to Lee.

"There are many counterpoints to suggest inflation could fall faster than consensus expects. This, in turn, would change the path of Fed policy. Arguably, the inflation swaps markets are already reflecting this, hence, the lower levels of implied inflation," Lee explained.


Digging into the actual components, Lee highlighted that commodity prices like gasoline, lumber, and wheat are falling like a rock, as are electronics, meats like chicken and beef, and clothing.

At the same time, used cars and vehicles, airfares, and durable goods are "starting to fall like a rock," and history has shown that rent and housing costs will "fall like a rock" soon, according to the note.

Analyzing the previous 40 years of rent data for New York City and San Francisco, Lee found that "when owners equivalent rent falls, it falls like a rock...rents could fall a lot faster than many expect."

With the view that inflation is quickly falling, Lee reiterated his call for a second half rally in the stock market that could ultimately drive the S&P 500 to new highs by year-end. "Bottom line. We see second half rally thesis intact," Lee concluded.
 

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Inflation is starting to 'drop like a rock' leading to deflation in certain areas of the economy, Fundstrat says​

mfox@businessinsider.com (Matthew Fox) - 6h ago
Inflation is starting to "drop like a rock" rather than a feather, leading to outright deflation in some areas of the economy, Fundstrat's Tom Lee said in a Wednesday note.

A slowdown in rising inflation would be welcome news to investors given that the stock market has sold off 5% since Fed Chair Jerome Powell's hawkish speech at Jackson Hole last week.

Powell reiterated the Fed's resolve to tame inflation by being aggressive with interest rate hikes and a reduction to its $9 trillion balance sheet. The market currently expects another outsized 75 basis point rate hike from the Fed at its FOMC meeting in late September.

If inflation cools and is less "sticky" than most expect, it could change the Fed's current interest rate hike trajectory, ultimately leading to a faster pivot towards a pause in rate hikes. That would be a boon for risk assets, which have been stymied in recent months by fast rising interest rates.

And according to Lee, inflation is quickly cooling.

"42% of CPI components are declining from recent highs = deflation," Lee said, adding that five of the nine US regions saw outright deflation in July on a month-over-month basis.

"These 5 regions represent 49% of GDP. In East North Central, CPI annualized is -3.96%, outright DEFLATION," Lee said.

Additionally, leading inflation indicators like used auto prices, airfares, and real estate "suggest many other components of CPI could start falling outright," according to Lee.

"There are many counterpoints to suggest inflation could fall faster than consensus expects. This, in turn, would change the path of Fed policy. Arguably, the inflation swaps markets are already reflecting this, hence, the lower levels of implied inflation," Lee explained.


Digging into the actual components, Lee highlighted that commodity prices like gasoline, lumber, and wheat are falling like a rock, as are electronics, meats like chicken and beef, and clothing.

At the same time, used cars and vehicles, airfares, and durable goods are "starting to fall like a rock," and history has shown that rent and housing costs will "fall like a rock" soon, according to the note.

Analyzing the previous 40 years of rent data for New York City and San Francisco, Lee found that "when owners equivalent rent falls, it falls like a rock...rents could fall a lot faster than many expect."

With the view that inflation is quickly falling, Lee reiterated his call for a second half rally in the stock market that could ultimately drive the S&P 500 to new highs by year-end. "Bottom line. We see second half rally thesis intact," Lee concluded.
I expect the next CPI to be below 8.5%, but I can't see "dropping like a rock". But hey, who knows.
 

2lion70

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I expect the next CPI to be below 8.5%, but I can't see "dropping like a rock". But hey, who knows.
It will be interesting to see how fast the Fed actions have slowed demand. Housing and construction are grinding to a halt, oil price dropped 9% in August. Identifying the start of any trend is difficult,
 
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junior1

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It will be interesting to see how fast the Fed actions have slowed demand. Housing and construction are grinding to a halt, oil price dropped 9% in August. Identifying the start of any trend is difficult,
economics is a wonderful art/science. We have a severe shortage of housing in a lot of places in the country. So now, we're increasing interest rates which makes housing less affordable, rents are higher and new home sales/ starts are falling. So what happens, builders/developers stop/slow down building, which exacerbates that housing shortage now and into the future.
So a year, two years from now, fed drops interest rates, all the youngsters start looking to buy their first house or expand to a bigger one to meet family needs. What do they find, you know it, a shortage of available housing. Its hard to find that equilibrium point.
Different direction...your post hints at falling inflation/deflation. I would think that voting members of the fed have the same if not better sources of data. Yet, over the past few weeks, the governors and Powell himself have been very, very firm that interest rates are going higher and some have said they won't come down until 2024. so, what's your opinion on the chances the fed will overshoot and keep interest rates high for too long? In general, the fed doesn't have a superb track record for timely/correct decisions.
 

BicyclePete

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Perhaps and that might continue until the November elections. Gotta get them votes you know.
 
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m.knox

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It will be interesting to see how fast the Fed actions have slowed demand. Housing and construction are grinding to a halt, oil price dropped 9% in August. Identifying the start of any trend is difficult,

LOL... A recession is a great way to stop inflation.
 
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Inflation is starting to 'drop like a rock' leading to deflation in certain areas of the economy, Fundstrat says​

mfox@businessinsider.com (Matthew Fox) - 6h ago
Inflation is starting to "drop like a rock" rather than a feather, leading to outright deflation in some areas of the economy, Fundstrat's Tom Lee said in a Wednesday note.

A slowdown in rising inflation would be welcome news to investors given that the stock market has sold off 5% since Fed Chair Jerome Powell's hawkish speech at Jackson Hole last week.

Powell reiterated the Fed's resolve to tame inflation by being aggressive with interest rate hikes and a reduction to its $9 trillion balance sheet. The market currently expects another outsized 75 basis point rate hike from the Fed at its FOMC meeting in late September.

If inflation cools and is less "sticky" than most expect, it could change the Fed's current interest rate hike trajectory, ultimately leading to a faster pivot towards a pause in rate hikes. That would be a boon for risk assets, which have been stymied in recent months by fast rising interest rates.

And according to Lee, inflation is quickly cooling.

"42% of CPI components are declining from recent highs = deflation," Lee said, adding that five of the nine US regions saw outright deflation in July on a month-over-month basis.

"These 5 regions represent 49% of GDP. In East North Central, CPI annualized is -3.96%, outright DEFLATION," Lee said.

Additionally, leading inflation indicators like used auto prices, airfares, and real estate "suggest many other components of CPI could start falling outright," according to Lee.

"There are many counterpoints to suggest inflation could fall faster than consensus expects. This, in turn, would change the path of Fed policy. Arguably, the inflation swaps markets are already reflecting this, hence, the lower levels of implied inflation," Lee explained.


Digging into the actual components, Lee highlighted that commodity prices like gasoline, lumber, and wheat are falling like a rock, as are electronics, meats like chicken and beef, and clothing.

At the same time, used cars and vehicles, airfares, and durable goods are "starting to fall like a rock," and history has shown that rent and housing costs will "fall like a rock" soon, according to the note.

Analyzing the previous 40 years of rent data for New York City and San Francisco, Lee found that "when owners equivalent rent falls, it falls like a rock...rents could fall a lot faster than many expect."

With the view that inflation is quickly falling, Lee reiterated his call for a second half rally in the stock market that could ultimately drive the S&P 500 to new highs by year-end. "Bottom line. We see second half rally thesis intact," Lee concluded.
Recessions are great.

besides that, Mrs Lincoln, how did you like the play?
 

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Inflation is starting to 'drop like a rock' leading to deflation in certain areas of the economy, Fundstrat says​

mfox@businessinsider.com (Matthew Fox) - 6h ago
Inflation is starting to "drop like a rock" rather than a feather, leading to outright deflation in some areas of the economy, Fundstrat's Tom Lee said in a Wednesday note.

A slowdown in rising inflation would be welcome news to investors given that the stock market has sold off 5% since Fed Chair Jerome Powell's hawkish speech at Jackson Hole last week.

Powell reiterated the Fed's resolve to tame inflation by being aggressive with interest rate hikes and a reduction to its $9 trillion balance sheet. The market currently expects another outsized 75 basis point rate hike from the Fed at its FOMC meeting in late September.

If inflation cools and is less "sticky" than most expect, it could change the Fed's current interest rate hike trajectory, ultimately leading to a faster pivot towards a pause in rate hikes. That would be a boon for risk assets, which have been stymied in recent months by fast rising interest rates.

And according to Lee, inflation is quickly cooling.

"42% of CPI components are declining from recent highs = deflation," Lee said, adding that five of the nine US regions saw outright deflation in July on a month-over-month basis.

"These 5 regions represent 49% of GDP. In East North Central, CPI annualized is -3.96%, outright DEFLATION," Lee said.

Additionally, leading inflation indicators like used auto prices, airfares, and real estate "suggest many other components of CPI could start falling outright," according to Lee.

"There are many counterpoints to suggest inflation could fall faster than consensus expects. This, in turn, would change the path of Fed policy. Arguably, the inflation swaps markets are already reflecting this, hence, the lower levels of implied inflation," Lee explained.


Digging into the actual components, Lee highlighted that commodity prices like gasoline, lumber, and wheat are falling like a rock, as are electronics, meats like chicken and beef, and clothing.

At the same time, used cars and vehicles, airfares, and durable goods are "starting to fall like a rock," and history has shown that rent and housing costs will "fall like a rock" soon, according to the note.

Analyzing the previous 40 years of rent data for New York City and San Francisco, Lee found that "when owners equivalent rent falls, it falls like a rock...rents could fall a lot faster than many expect."

With the view that inflation is quickly falling, Lee reiterated his call for a second half rally in the stock market that could ultimately drive the S&P 500 to new highs by year-end. "Bottom line. We see second half rally thesis intact," Lee concluded.
Well, you made it two weeks before face planting...may be a new snowflake record for you Sunshine!...lulz
 
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crazyivan77

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Thanks Joe.


200w.gif
 
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Inflation is starting to 'drop like a rock' leading to deflation in certain areas of the economy, Fundstrat says​

mfox@businessinsider.com (Matthew Fox) - 6h ago
Inflation is starting to "drop like a rock" rather than a feather, leading to outright deflation in some areas of the economy, Fundstrat's Tom Lee said in a Wednesday note.

A slowdown in rising inflation would be welcome news to investors given that the stock market has sold off 5% since Fed Chair Jerome Powell's hawkish speech at Jackson Hole last week.

Powell reiterated the Fed's resolve to tame inflation by being aggressive with interest rate hikes and a reduction to its $9 trillion balance sheet. The market currently expects another outsized 75 basis point rate hike from the Fed at its FOMC meeting in late September.

If inflation cools and is less "sticky" than most expect, it could change the Fed's current interest rate hike trajectory, ultimately leading to a faster pivot towards a pause in rate hikes. That would be a boon for risk assets, which have been stymied in recent months by fast rising interest rates.

And according to Lee, inflation is quickly cooling.

"42% of CPI components are declining from recent highs = deflation," Lee said, adding that five of the nine US regions saw outright deflation in July on a month-over-month basis.

"These 5 regions represent 49% of GDP. In East North Central, CPI annualized is -3.96%, outright DEFLATION," Lee said.

Additionally, leading inflation indicators like used auto prices, airfares, and real estate "suggest many other components of CPI could start falling outright," according to Lee.

"There are many counterpoints to suggest inflation could fall faster than consensus expects. This, in turn, would change the path of Fed policy. Arguably, the inflation swaps markets are already reflecting this, hence, the lower levels of implied inflation," Lee explained.


Digging into the actual components, Lee highlighted that commodity prices like gasoline, lumber, and wheat are falling like a rock, as are electronics, meats like chicken and beef, and clothing.

At the same time, used cars and vehicles, airfares, and durable goods are "starting to fall like a rock," and history has shown that rent and housing costs will "fall like a rock" soon, according to the note.

Analyzing the previous 40 years of rent data for New York City and San Francisco, Lee found that "when owners equivalent rent falls, it falls like a rock...rents could fall a lot faster than many expect."

With the view that inflation is quickly falling, Lee reiterated his call for a second half rally in the stock market that could ultimately drive the S&P 500 to new highs by year-end. "Bottom line. We see second half rally thesis intact," Lee concluded.

Lol reading this headline never gets old.
 

m.knox

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It's DROPPING LIKE A ROCK.....

@bdgan knows... Inflation goes up and inflation goes down..... lol....
 
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The Spin Meister

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An altered state
It seems Biden, like many on the left, don't understand what inflation is and how devastating it is to people.

But then again these are the same people whp forcefully closed businesses and kept people from their relatives.
When you have cushy government job you don’t care about inflation. ESPECIALLY IF YOU GET MASSIVE SUBSIDIES FROM YOUR CHINESE MASTERS!
 
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Inflation is starting to 'drop like a rock' leading to deflation in certain areas of the economy, Fundstrat says​

mfox@businessinsider.com (Matthew Fox) - 6h ago
[COLOR=%s]Inflation is starting to "drop like a rock" rather than a feather, leading to outright deflation in some areas of the economy, Fundstrat's Tom Lee said in a Wednesday note.[/COLOR]

A slowdown in rising inflation would be welcome news to investors given that the stock market has sold off 5% since Fed Chair Jerome Powell's hawkish speech at Jackson Hole last week.

Powell reiterated the Fed's resolve to tame inflation by being aggressive with interest rate hikes and a reduction to its $9 trillion balance sheet. The market currently expects another outsized 75 basis point rate hike from the Fed at its FOMC meeting in late September.

If inflation cools and is less "sticky" than most expect, it could change the Fed's current interest rate hike trajectory, ultimately leading to a faster pivot towards a pause in rate hikes. That would be a boon for risk assets, which have been stymied in recent months by fast rising interest rates.

And according to Lee, inflation is quickly cooling.

[COLOR=%s]"42% of CPI components are declining from recent highs = deflation," Lee said, adding that five of the nine US regions saw outright deflation in July on a month-over-month basis.[/COLOR]

"These 5 regions represent 49% of GDP. In East North Central, CPI annualized is -3.96%, outright DEFLATION," Lee said.

[COLOR=%s]Additionally, leading inflation indicators like used auto prices, airfares, and real estate "suggest many other components of CPI could start falling outright," according to Lee.[/COLOR]

"There are many counterpoints to suggest inflation could fall faster than consensus expects. This, in turn, would change the path of Fed policy. Arguably, the inflation swaps markets are already reflecting this, hence, the lower levels of implied inflation," Lee explained.


Digging into the actual components, Lee highlighted that commodity prices like gasoline, lumber, and wheat are falling like a rock, as are electronics, meats like chicken and beef, and clothing.

At the same time, used cars and vehicles, airfares, and durable goods are "starting to fall like a rock," and history has shown that rent and housing costs will "fall like a rock" soon, according to the note.

Analyzing the previous 40 years of rent data for New York City and San Francisco, Lee found that "when owners equivalent rent falls, it falls like a rock...rents could fall a lot faster than many expect."

With the view that inflation is quickly falling, Lee reiterated his call for a second half rally in the stock market that could ultimately drive the S&P 500 to new highs by year-end. "Bottom line. We see second half rally thesis intact," Lee concluded.

Boom.
 
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SR108

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Inflation is starting to 'drop like a rock' leading to deflation in certain areas of the economy, Fundstrat says​

mfox@businessinsider.com (Matthew Fox) - 6h ago
[COLOR=%s]Inflation is starting to "drop like a rock" rather than a feather, leading to outright deflation in some areas of the economy, Fundstrat's Tom Lee said in a Wednesday note.[/COLOR]

A slowdown in rising inflation would be welcome news to investors given that the stock market has sold off 5% since Fed Chair Jerome Powell's hawkish speech at Jackson Hole last week.

Powell reiterated the Fed's resolve to tame inflation by being aggressive with interest rate hikes and a reduction to its $9 trillion balance sheet. The market currently expects another outsized 75 basis point rate hike from the Fed at its FOMC meeting in late September.

If inflation cools and is less "sticky" than most expect, it could change the Fed's current interest rate hike trajectory, ultimately leading to a faster pivot towards a pause in rate hikes. That would be a boon for risk assets, which have been stymied in recent months by fast rising interest rates.

And according to Lee, inflation is quickly cooling.

[COLOR=%s]"42% of CPI components are declining from recent highs = deflation," Lee said, adding that five of the nine US regions saw outright deflation in July on a month-over-month basis.[/COLOR]

"These 5 regions represent 49% of GDP. In East North Central, CPI annualized is -3.96%, outright DEFLATION," Lee said.

[COLOR=%s]Additionally, leading inflation indicators like used auto prices, airfares, and real estate "suggest many other components of CPI could start falling outright," according to Lee.[/COLOR]

"There are many counterpoints to suggest inflation could fall faster than consensus expects. This, in turn, would change the path of Fed policy. Arguably, the inflation swaps markets are already reflecting this, hence, the lower levels of implied inflation," Lee explained.


Digging into the actual components, Lee highlighted that commodity prices like gasoline, lumber, and wheat are falling like a rock, as are electronics, meats like chicken and beef, and clothing.

At the same time, used cars and vehicles, airfares, and durable goods are "starting to fall like a rock," and history has shown that rent and housing costs will "fall like a rock" soon, according to the note.

Analyzing the previous 40 years of rent data for New York City and San Francisco, Lee found that "when owners equivalent rent falls, it falls like a rock...rents could fall a lot faster than many expect."

With the view that inflation is quickly falling, Lee reiterated his call for a second half rally in the stock market that could ultimately drive the S&P 500 to new highs by year-end. "Bottom line. We see second half rally thesis intact," Lee concluded.
Yea, that’s why my electric bill doubled and gas is still 3.90 + in Pennsylvania.

Have you gone to a restaurant lately?
 
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