This audio summarizes our July 22 note, We Have Currency Problems Figure 4: Initial claims appear to have seasonal adjustment factor issues, but the trend in continuing claims is unmistakable. Barry C. Knapp Managing Partner Director of Research Ironsides Macroeconomics LLC 908-821-7584 bcknapp@ironsidesmacro.com https://www.linkedin.com/in/barry-c-knapp/ @barry… Read more ..read more

We apologize for the Monday morning release this week although it did allow us to integrate President Biden’s announcement into the note. Next week’s note will also be delayed until Monday morning. Bye Bye Biden (BN) BIDEN IS DROPPING OUT OF PRESIDENTIAL RACE (BN) BIDEN ENDORSES KAMALA HARRIS AS DEMOCRATIC PRESIDENTIAL NOMINEE As we began writing this note on Sunday after spending the last four days playing in the largest member guest golf tournament in the country (or so we were told, but didn’t verify) the preceding headline scrolled across Bloomberg. The immediate reaction was a modest 1.4 ..read more

This audio summarizes our July 13 note, Healthy Broadening of Disinflation Figure 5: The banking business model curve has a long way to go to disinvert. Barry C. Knapp Managing Partner Director of Research Ironsides Macroeconomics LLC 908-821-7584 bcknapp@ironsidesmacro.com https://www.linkedin.com/in/barry-c-knapp/ @barryknapp This institutional communication ha… Read more ..read more

Note: The next two weeklies will be released on Monday morning rather than our standard Saturday delivery. We have back-to-back golf member guest tournaments. The Cost of Price Stability While all items CPI cooled from 9% in June ‘22 to 3% in June ‘23, firmed modestly to 3.7% in 3Q23, before returning to 3% in June ‘24, our measure of price stability, the standard deviation of annualized all items CPI, has been steadily declining to the 4Q19 average of 20bp. Inflation volatility persisting below 50bp annualized is relatively rare; it occurred in the early ‘60s and in the late ‘90s, and both pe ..read more

Note: We will be in NYC Wednesday and Thursday Slowdown The Atlanta Fed GDP tracking model for 2Q24 peaked over 4% in early May following the release of April employment, retail sales and the ISM Manufacturing and Services surveys, but has fallen through June and early July to 1.5% after weak June ISM surveys. As we will discuss in this week’s note, the June employment report was unequivocally soft with a range of leading components, including a key recession indicator, making a September rate cut probable. In short, the economy came into 2Q like a lion and is going out like a lamb. The intern ..read more

“Employment goes up like a rocket, and down like a feather” Federal Reserve Bank of Chicago President Austan Goolsbee June Payroll Preview Although incoming data on demand for labor since the May employment report has softened marginally, it seems unlikely that the debate between the Household Survey and lagged data from the Quarterly Census of Employment and Wages (QCEW), relative to the robust gains in the Current Employment Statistics (CES) Establishment Survey, will be settled on Friday. Consensus expectations are for a 195,000 increase in nonfarm payrolls, a 4.0% unemployment rate and ave ..read more

This audio summarizes our June 29 note, Hayek Shrugged Figure 10: The decline in vacancies appears to be accelerating. Barry C. Knapp Managing Partner Director of Research Ironsides Macroeconomics LLC 908-821-7584 bcknapp@ironsidesmacro.com https://www.linkedin.com/in/barry-c-knapp/ @barryknapp This institutional communication has been prepared by Ironsides Macro… Read more ..read more

Policy Calculus We first wrote about the ‘60s analog in June ‘21 and since then have frequently returned to the decade of strong growth, capital investment and earnings, combined with rising government spending and inflation that led to positive equity returns despite an acceleration of the three-decade bond bear market. As we watched President Biden’s probability of reelection plunge in the election markets (to ~20%) by far more than former President Trump’s chances increased (~60%) during the presidential debate Thursday evening, the ‘60s analog took on more meaning with an LBJ withdrawal fo ..read more

This audio summarizes our June 22 note, Earnings Crunch Time Figure 3: Negative net revisions in the industrial sector are one of our biggest portfolio risks. Barry C. Knapp Managing Partner Director of Research Ironsides Macroeconomics LLC 908-821-7584 bcknapp@ironsidesmacro.com https://www.linkedin.com/in/barry-c-knapp/ @barryknapp This institutional communicat… Read more ..read more

Countertrend UST Rally (BN) CBO RAISES US 2024 DEFICIT-TO-GDP RATIO TO 6.7% FROM 5.3% (BN) CBO BOOSTS 2024 US BUDGET DEFICIT ESTIMATE TO $1.9T FROM $1.5T The three economic reports of note this week — May Retail Sales, the July Current Employment Statistics (CES) survey week for initial jobless claims, and May Housing Starts — were weaker than expected, thereby adding additional economic evidence to the unhealthy broadening macro price signal of all non-AI related economically sensitive sectors we discussed in last week’s note, The Good Place. Also, notable this week was the Congressional Budg ..read more