Good Morning America, How Are You?
Listening is not easy for me anyway. I did not talk to anyone yesterday except my
wife. I tried to give my full attention
to her day. My mind wandered. Sigh... Today I hope to do better, although I
don't expect to talk to anyone but my wife again today.
It rained hard off-and-on yesterday. My early peonies have the petals lying in a
puddle on the ground. The life-cycle
starts again, and the shiny green of the leaves are still attractive in the
overall garden (or so I think). My Tree
Peonies look so sad after having huge 24 inch blooms all over them. I look forward to next year. My late peonies are just blooming.
Have a great day.
Enjoy your food, wine and your family.
Small Business Outlook
The NY Times had several articles
and opinions on immigration today. The
one that caught my was "Migrants Flow in South Texas, as Do
Rumors". Carmen Avila recently came
to the US, seven months pregnant and with a 4 year old son.
" I heard in Guatemala that
people were caught by immigration, but then they let them go and gave them a
permit. The word got around, and that's why so many people are coming."
To immigrate in the way many from
Central America are immigrating is a tough and dangerous journey. And yet, where are the jobs? For if they come, then there must be
jobs.
Are not nearly all of these
immigrants basically untrained for anything but menial jobs? If so, then what are the young USA citizens
trained for? (meaning why are the large majority of young people unemployed? Is
it not because there are only a few jobs for the untrained vs the amount of
people willing to take those jobs?)
The articles in the NY Times pull
at your heartstring, but they don't explore the other side of the issue for the
USA citizens themselves.
Small Business is where most of
these people that are allowed to stay will be employed. Yet, irrespective of the White House's
rhetoric, the government is not helping the really small businesses that must
employee these folks.
Summary:
Did you know that the stock market
is nuts. Looking at the news from
yesterday, (not just financial news, but all news) does the market move make
sense?
Here is a 5 minute chart of NQ
mini futures starting at the opening in NY from yesterday.
Possibly, the news on Industrial
Production drove the market until the housing report at 7:00Am PDT.
No, the housing report was not
that bad. It actually beat
consensus. New Home sales were showing
improvement.
Then what happened at 8:30 that
made the market reverse with no consolidation?
Who knows, but the DOW, S&P 500 and the Nasdaq all closed in
positive territory.
Somewhat the market is waiting on
the 2 day FOMC meetings that start today.
Are investors, banks and traders expecting any earth shaking news? No, but it is the rule now to wait for the
Federal Reserve and the European Central Bank to tell us how they are planning
to rule the world.
This morning, the consumer price
index is showing warmer inflation than expected. The inflation Genie is trying to escape the
bottle, and the Genie is not benign.
However, if the Genie is anywhere
near escaping, would we find metals exploding to the upside? Well the Gold Bugs would certainly want you
to believe that, and if you follow them, then Gold is being hammered down
yesterday and today. Copper is also moving
lower with only a couple of days of respite.
What does that say about inflation?
Actually, nothing... If you don't get irate over "nothing",
think about what leads? Does inflation lead Gold and Silver, or does Gold and
Silver forecast inflation?
Central Banks are still fighting
deflation, and have chosen to ignore any inflation. Investors worldwide will
very likely be looking for Janet Yellen to clarify the global economy and the
USA strategic position on QE. If so,
look for the market to be choppy until Wednesday's FOMC announcement and Dr.
Yellen's statement on the meeting.
Maybe, just maybe, markets go down
sometimes simply because there is more selling interest among traders and
investors than buying interest. And on
the flip side, markets sometimes go up because there is more buying interest
than selling interest. There can be all
kinds of opinion on why markets are doing what they are doing. But in the end, price goes up and it goes
down; sometimes without any information that explains why.
This morning the S&P futures
market were higher. Then the CPI report
and housing reports were released. CPI
was higher than expected (as noted).
However, housing starts were lower.
CPI caught the trader's ears in Treasuries which fell to a new session
low after the release of the CPI.
Housing starts fell 6.5% in
May. Single family starts declined
5.9%. Building permits are used as
leading indicator of future housing data.
Building permits were down.
Overall, I can't help but wonder
if the economic news is mixed, and the markets will chop (once NY is open for
trading) until FOMC minutes on Wednesday.
Things are just too confused at the moment.

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