Good morning. Stocks got a little bit of a boost in early trading as CPI (Consumer Price Index) rose less than expected as the inflation number continues to get closer to the Fed’s 2% stated target. But that doesn’t mean the Fed will rush to lower rates anytime soon … regardless of constant prodding by the President. In fact, just prior to this morning’s print, Daily Shot reported “the market” (whatever that is) forecast is predicting fewer than 2 rate cuts to take place this year. And the lower inflation might not last … though “experts” have been wrong so far about this … as NFIB (National Federation of Independent Business) claims there is an increase in firms planning to boost prices on the heels of tariffs. There is one other issue … with recent federal cuts affecting many areas … as UBS feels cuts at the Bureau of Labor Statistics is resulting in “less precise” methods being used to calculate CPI … all because of sudden staffing shortages. But CPI is not the only positive news, as investors might also be breathing a sigh of relief as it appears talks between the U.S. and China are going well … and the World Bank actually appears to back the Trump claim that the trade balance has been uneven … while lowering global economic growth forecasts due to the U.S. tariff actions. One interesting thing we are starting to see in the U.S. is a small … yet meaningful … decline in U.S. home prices as inventory actually seems to be outpacing demand … and NAR (National Association of Realtors) showed a sharp decline in pending home sales for April. We’ll see if that continues as there seems to be concern over this … especially in the South Florida region. I hate to complain on a positive market day, so please forgive me … but records just coming in continue to show some in Congress making some very smart trades (ahem) surrounding White House announcements. It is absolutely crazy (my opinion) that many in this group … having information that some in our industry would classify as “insider” … are able to make personal trades and profit (or limit losses) related to items they decide or have knowledge about. I mean, last week an executive order was announced favoring technology beneficial to eVTOL (Electric Vertical Take-off and Landing) companies. There does not seem to be anything stopping anyone who happened to be in the know from purchasing stocks in related companies just prior to public release of the news. My cousin is an idiot. He took on debt and spent 4 years in medical school hoping to get incredibly rich. Instead, he should have just become a politician. Have a great day, Joseph G. Witthohn, CFA Have any questions? Please contact info@teamemerald.com
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