| Good morning.
World leaders in ancient times … and probably some today … had “food tasters” who would sample a bit of the food about to be digested to make sure it wasn’t poisoned. Yesterday’s inflation report tried a sampling of the dish the Fed has on its table … and investors quickly realized something rancid in the stew. How poisonous the data might be remains to be seen.
Over the past few months many believed the inflation monster was on its way to being tamed. Upticks were seen as temporary, for price increases would soon slow … or so it was believed. But MRB Partners is pointing out a fear of many … that inflation’s strength may be “more than just a blip.”
This is not lost on markets (as seen in yesterday’s decline) and Daily Shot mentioned that, in their view, “the probability of a Fed rate cut in June rate has collapsed” … using the almost immediate drop from over-50% probability to under-20% probability to support such a pessimistic announcement.
Keep in mind that what we are witnessing today, might not be the way we see things tomorrow … as a PPI (Producer Price Index) number just came out which was actually below forecasts, giving some hope to those who get excited at every little inkling of positive news … no matter if it is just a “one-off” event or not. We will call members of this group (of which I am a member): “the blipsters.”
Note that one strategist from JP Morgan provided in a story included below an interesting take … which flies in the face of many who are paid quite handsomely to provide economic thought … for he proposes that rate cuts will not act to further fan the flames of inflation but, instead, actually help bring inflation under control. His rationale? The need to reduce housing/shelter costs, bring mortgage rates down and incentivize low-mortgage-rate homeowners to move … allowing more inventory to enter the market and form a steadier pathway for first-time owners.
Okay, I want to get off of markets for now … as I am obviously confused and all-over-the place in both my thinking and my writing (as usual) … and offer a bit of a gripe.
The Olympics and why I no longer watch.
I used to love the Olympics … and looked at them with the same sense of wonder and joy as I would get seeing “Wide World of Sports” when that was a popular television show.
I remember exactly where I was when the U.S. team beat the Russians in hockey and to this day … more than 24 years later … still fondly remember the names of Jim Craig and Mike Eruzione. Those were glorious times when amateurs were placed on the world stage and showed how grit and determination could overcome great odds.
Then, somehow, things changed. Sure, there were rumors that professionals were playing for other teams. But that did not deter our … mainly college kids … from taking their talents and love of a sport to a higher level.
Somewhere along the way, we decided we just had to … I don’t know … win. At any cost. We allowed professions in … tennis … basketball … hockey … golf (soon) to take the glamor away from the “kids.” Just like moving the fences of baseball parks closer … and having basketball all-star games with a soon-to-be final score of 220-197 … someone saw the need for change.
And now some Olympic athletes will be paid. But only if they win.
Win at all costs … after all it’s the American way.
Sorry about the soapbox. Maybe it’s because I am bitter. Friends might not be aware, but a much younger, lighter and in-better-shape me had Olympic dreams at one point and I fell slightly short in qualifying for the 100-meter race. Just barely short.
I just needed to be 8 seconds faster.
Have a great day,
Joseph G. Witthohn, CFA
Vice President
Emerald Asset Management PA, LLC
610 Freedom Business Center Drive
King of Prussia, PA 19406
cell: (856) 625-7915
wit@teamemerald.com
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