Good morning. “The Ghost of Christmas Yet to Come” is portrayed as the visitor Ebenezer Scrooge feared the most … and many investors now have a sense of Ebenezer’s concern as they await tomorrow’s conclusion of a two-day Fed meeting. While the 25bp (0.25%) cut is expected by … well … just about everyone … it is the Fed foresight of what is “yet to come” at the follow-up press conference that could indicate just how merry Christmas might be for good little investors throughout the land. Meanwhile, coal prices (as reported by the U.S. Department of Energy) have fallen quite a bit over the last year. I’m just pointing this out in case Santa wants to load up. The President is starting a “things aren’t so bad” tour today and will do his best to convince people that any negative attitudes have been brought on by a biased media. The story will include that people are still shopping with a stock market continuing to be near an all-time high, so we’ll see how well his message is received. A concern, of course, remains to be inflation. The NY Fed came up with an interesting survey result claiming consumer expectations show inflation over each of three time periods: 1 year, 3 year and 5 year is expected to be 3% or more … disappointing those hoping to see the Fed-stated-goal of 2% filtered somewhere in the results … while leaving some to probably wonder if we should just give up and accept 3% as the new target. There is one problem, however, with recent numbers showing stronger-than-expected shopping during Thanksgiving and, especially, Black Friday. Both Adobe and Klarner are reporting a strong uptick in “buy now, pay later” holiday purchases across all economic demographics which, in the face of surveys showing a decline in comfort over future finances … makes you wonder if this common phrase should actually be changed to “buy now, think later” … because just like a visit from the Ghost from Christmas Future … borrowing money when uncertain about the ability to pay it back could certainly come back to haunt so many of us Have a great day, Joseph G. Witthohn, CFA Have any questions? Please contact info@teamemerald.com
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