Michael Gregory
Michael Gregory
consumer continues creeping despite energy fact gains housing job offset potential prices providing remain spending suggest
Despite the fact that energy prices are creeping up and housing continues to crumble, surveys suggest job gains are providing an offset for confidence. The potential is there for consumer spending to remain resilient.
along consumer ebb equity fed growth keys mortgage prices pull spending
Mortgage equity withdrawal (which keys off prices and rates) is going to ebb substantially and pull consumer spending growth down along with it. When it does, the Fed will pause.
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But against the backdrop of improvements in commodity prices, the fact the Canadian dollar has been rallying and the long end of the market had already priced it in, they thought, 'Listen, our rates should be below U.S. rates. Our inflation is lower and we're well behind in the economic cycle.'
among badly burnt data decline economic europe eventually investors quite rate robust talk tougher
Much of the decline is disappointment among investors who were burnt quite badly in 1999 where they thought things had bottomed. You'll have to see some tougher talk from the ECB, more robust economic data from Europe and eventually a rate hike.
clearly federal interest raise reserve risk surprise
There wasn't all that much of a surprise there. Clearly the risk is still there for the Federal Reserve to raise interest rates.
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It's not so much GM, but it could have been one of the proverbial straws that broke consumers' backs. All of a sudden people have to pay more for energy, debt service, healthcare, and save more for retirement.
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It's only a matter of time though before the consumer succumbs to weakening housing and higher gas prices, and I think we'll see that by the third quarter.
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Consumers may be wobbly, owing to high energy prices, a vulnerable housing sector and increasingly uncertain medical and pension benefits, but there is nothing like the whiff of solid job growth to keep them on their feet.
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There is no question that the economy is slowing, but it's not exactly shrinking, either, ... We are seeing the first tentative signs of slowing, but you have to remember that we are starting at a very high base of growth. The Fed will still err on the side of caution and restraint.
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We're seeing signs that consumers are starting to feel the impact of persistently high gas prices. As prices stay high we're going to see the impact broaden from discount to more mainstream retailers.
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Claims are pointing to firm, if not firming, conditions in the labor market. Corporate profits are just huge and businesses are in a position to expand.
broader continues housing sector surprise view
This surprise rise in no way alters the broader view that the housing sector continues to cool.
economic exports further global growth pickup support
Exports should find further support from the pickup in global economic growth.
activity factory likely remains slightly
Factory activity likely cooled slightly in December, but remains robust.