Friday, January 14, 2011

The reality of the economy and the irrationality of the Fed and Wall St.

Yes my friends, new data released today defies the logic of the markets. First piece of news was that Michigan Sentiment came in lower than expected for December at 72.7. The prior months reading was 74.5 and the expectation for Dec. was 75.5. So much for that "good news"!

Then the Retail Sales number was reported at 0.6% for Dec. Expectations were for 1.0% for Dec. Nov. came in at 0.8%. So this clearly is in the wrong direction and includes the Christmas shopping data. Remember how they said it was a great season? Hmmmm.

The CPI came in at +0.5% for Dec. Expectations were for +0.3%, so that's in the wrong direction but Core CPI came in at only +0.1%, which excludes Oil for some reason. You don't need gasoline or heating Oil, right? That isn't a "cost" to you, right?

So how's the market reaction to this news? Well the markets were down before the news came out and now they are up! Go figure, it's QE2 at work distorting reality of the economy. Thanks Fed Chairman Bernanke!

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Anonymous CFD's Shorting said...

It seems all expected increase last December has failed. But it is still good to hear that the dividends are not as high as into losing. I hope these things would soon be worked out. I'm just wondering why there is decrease in number of retail sales while in fact, December has many holidays. Does this simply mean, US is still affected by recession?

12:35 PM  
Blogger Charles Amico said...

I do believe the Retail Sales were affected by the economy and vice versa.

2:41 PM  
Anonymous marketing bureau said...

If the people were just a good tax payer, then probably all the countries would have been as progressive as of this days. Taxes are important, because this is where the government gets some of the funding to develop buildings and other infrastructure.

6:01 PM  

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