Incomes are UP
PCE numbers this morning showed consumer incomes are up, this along with good employment report indications yesterday. That is the very important as the end of the FED’s Economic Destruction phase is here.
As the CRB commodity index and oil prices confirm, producer prices have peaked, that will eventually feed through the production chain to the consumer.
What is key, is that the grass roots production level can handle 3.5 percent rates. Employment is going to continue firm.
Corporate CEO’s are the villian here in terms of GDP, as earnings are their main concern, and of course the FED has no patience to see the long-term response to what they have done in fixing their mistake.
So, I am sticking with my growth response all the while watching Wall Street on the negative safe side.
And, watching the Dollar…
Overnight the DXY low was 111.74, just above the 111.70 trap door. What is significant about the dollar is what a decline means to the international community, it means the FED has raised interest rates to a level where it can sit and watch.
And, on the speculative side of the model portfolio…
Part of what is happening as the new era evolves, just look at the difference in today’s action on two of the 3X leveraged ETF’s, the Old economy SPXL is treading water while the New Economy TNA is acting well.