| Nick Timiraos Tells Us Jay Powell Scored a Hat Trick… The jobs market and economy cooled while the long bond eased.
What It Means—Now, if the Fed chair and other central bankers talk up lower GDP expectations, a September rate cut will be all but assured. The Hits Keep Coming for Biden… and Trump… Biden looked bad at his recent debate and then his “debate” with no one. But then a now deceased 20-year old attempted to assassinate former President Trump at a campaign rally this past Saturday. What It Means— We could talk about slow economic development or Biden’s latest forays into public speaking, but the attempt on Trump renders all of that moot. Assassination is assassination. It’s vile. Inflation Is Down… Consumer prices fell for the first time in four years on the Personal Consumption Expenditures Index (PCE). That’s not near the Fed’s target of 2%, but it’s going the right way. What It Means— The rate of inflation is better, but consumers like you and us aren’t fooled. Just because prices are rising at a lower rate, it does not mean prices are falling. People still aren’t buying much. In some areas (like insurance), prices are now sky high. Food prices are up 25% since 2019, and PepsiCo recently reported that people were buying less of their sodas and snacks, an area that had weathered buying pressures consistently. Drop in Mortgage Rates Largest in Three Weeks… The 30-year mortgage is at 6.89%, vs. 6.96% for the same time last year, and going in the right direction. What It Means— This small drop, along with reports of weakening in the labor market and a slowdown in housing prices, could be an indicator of lower rates, but we won’t know for sure until we get closer to the end of the summer. We want people to jump into the market, both selling their current homes and buying new ones. In other words, we need velocity in the real estate market… and lots of it. A small drop in rates won’t make that happen; we need the Fed to show that it is serious about lower short interest yields, which will pull down long yields with them. An Assassin Takes Aim at Donald Trump… A person attempted to assassinate the former president at a campaign rally in Pennsylvania. Obviously, Trump survived. The shooter did not. But the Secret Service is now under a microscope, and for good reason. English Couple Trains Prison Reoffenders To Make Beer… A married couple, Amy Taylor and Paul Humpherson, wanted to help people coming out of prison find a new livelihood. They created the Tap Social Movement in the U.K., which trains people in prison and leaving prison to make ale. As Thomas Jefferson said, good beer “softens the temper, cheers the spirit and promotes health.” Given that these are reoffenders, anything we can do to take their minds off their next crimes is worth a shot… or a pint.
Data supplied by HS Dent Research
“When the facts change, I change my mind. What do you do?” ~ John Maynard Keynes
Our plan is “the plan will change.” What is your plan?
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