A Labor of Locks

VIPs Bankruptcy filings for companies with at least $50 million in debt hit three in the week ended November 12 vs. nearly 15 seen in June 2020; though the Fed’s credit backstop limited creative destruction, corroded supply chains are pressuring firms that survived the pandemic An average of Future Inventories from regional Fed surveys suggests […]

Danger, Will Robinson!

VIPs Per Bank of America, the percentage change in inflation-adjusted grocery spending on a 2-year basis slipped further into contraction in October; while food inflation appears to be leveling off at high levels, per the CRB, higher prices are driving nominal gains in card spend On an inflation-adjusted basis, growth in goods spending reached a […]

Hysteron Proteron Club

  VIPs New homes under construction rose to 1.451 million in October, eclipsing the 2000s peatilk of 1.426 million circa March 2006; the last time units under construction were higher was the 1970s, though the current boom critically lacks the same underlying population growth rates Unsold existing single-family home inventories sit at 2.4-months, a record […]

King of the Catch Phrase

VIPs October’s 1.7% MoM retail sales print was the largest since March and more than four times greater than the 0.4% long-term average; however, given these are nominal terms, deflating them using the CPI shows real retail sales remain 6% below March’s post-pandemic high At 1.09, September’s retail inventory/sales ratio hovered just above April 2021’s […]

Not Archimedes Principle

  VIPs Cass freight shipping costs saw a 36.2% YoY gain in October, the largest on record, as supply chain disruptions persist; though logistics costs have surged, shipment volume has calmed thus far in Q4 to a 0.8% YoY advance vs. the 29.9% and 9.1% gains of Q2 and Q3 The American Trucking Association estimates […]

Greatest Expectations

  VIP The record 4.3 million U.S. workers who quit in September total 3.0% of total employment, a sign of increasing worker confidence; geographically, quits were highest in the South at 3.3%, and were outsized in food/accommodation and arts/entertainment at 6.6% and 5.7% Though off a record high 7%, job openings still remain at an […]

Walkin’ In Memphis Like an Egyptian

VIPs Per CoreLogic, Memphis is the most desirable housing market for investors, with the rest of the top 10 spread across the South and Mountain-West; conversely, the least attractive housing markets for investors, save for two cities in Louisiana, are in the Northeast Pre-pandemic moratorium, Memphis historically had one of the highest eviction rates of […]

Thank You for Your Service

        VIPs Both the MoM and YoY changes in the CPI and core CPI exceeded every estimate by economists in Bloomberg’s survey; the surprise generated an up-shift in the U.S. Treasury curve, with the greatest bulging seen at the 5-yr point as the 5s30s curve flattened < 70 bps In the last […]

Banzai Pipeline

VIPs PPI inflation for intermediate goods has exceeded the same metric for finished goods by a double-digit margin for the last six months; only the seven-month stretch from July 1974 to January 1975 compares historically, as pipeline pressures risk bleeding into consumer prices ISM Manufacturing New Orders, though still above the 50-breakeven, has fallen below […]

We Go Together

VIPs The S&P 500 Basic EPS Hotels was never negative until 2020, and has stayed in contraction for the last seven quarters; despite their historically tight correlation, hotel occupancy has recovered to pre-pandemic levels while hotel profits lag on account of higher input costs Since bottoming out in April 2020, hotel workers have seen their […]