CPI came in in-line with expectations. The headline figure was 0.4% while the CPI less food and energy came in at 0.1%. These are relatively benign figures. There are no serious signs of deflation and inflation isn’t running wild. Not too hot and not too cold. A Goldilocks figure in case you’re a Kudlow fan. Unfortunately for those of us who are growing increasingly concerned about the perpetual boom bust cycle created by easy money, this only throws fuel on the fire. Bernanke is now in the exact position he wants to be – wait and see mode. That means the fire can rage while the Fed chief twiddles his thumbs. Much like he did when he kept rates too high in 2007 and much like Greenspan did in 2003 when he kept rates too low. If the global economy begins to take off as it did in 2003 we are almost certain to see a repeat of the boom portion of the cycle in the coming years. Of course, the likelihood of a following bust is high….Econoday has some thoughts on the data:
Several factors kept the core rate soft. The cash-for-clunkers tax credits helped push prices for new vehicles down by 1.3 percent. Apparel slipped 0.1 percent. Shelter costs were sluggish, including owners’ equivalent rent rising only 0.1 percent. The recession has kept rents soft which also impact owners’ equivalent rent which is based on actual rent for owner-type houses. On the upside, prescription drugs increased 0.6 percent and airline fares jumped 1.7 percent.
Year-on-year, headline inflation rose to minus 1.4 (seasonally adjusted) from down 1.9 percent in July. The core rate eased to up 1.5 percent in July from up 1.6 percent the previous month. On an unadjusted year-ago basis, the headline number was down 1.5 percent in August while the core was up 1.4 percent.
Outside of energy, consumer price inflation is subdued, leaving the Fed flexibility for when to start unwinding its balance sheet expansion. Given that the August numbers matched expectations, there should be little market reaction today. But the higher energy costs serve as a reminder that when recovery strengthens, oil prices and headline inflation are likely headed up. Bond traders should take note.
In other news. industrial production came in better than expected at 69.6%. This…
The Kansas City Fed Manufacturing Survey business conditions indicator measures activity in the following states: Colorado, Kansas, Nebraska, Oklahoma, Wyoming, western Missouri, and northern New Mexico
Quarterly data for this indicator dates back to 1995, but monthly data is only available from 2001.
Here is an excerpt from the latest report:
KANSAS CITY, Mo. –The Federal Reserve Bank of Kansas City released the July Manufacturing Survey today. According to Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City, the survey revealed that Tenth District manufacturing activity declined modestly.
"Factories in our region reported a slight pullback in July follow...
We are already experiencing the powerlessness of POTUS.
We all know the POTUS (President of the United States) has the power as Commander-in-Chief to engage the nation in senseless, costly, needless wars. We also know the POTUS has a media-saturated bully pulpit to set an agenda and fashion a cultural tone for the nation.
But beyond the power to wage war and dominate the media spotlight, does the Pr...
By Jacob Wolinsky. Originally published at ValueWalk.
NetSuite Inc (NYSE:N) is soaring this morning as Oracle Corporation (NASDAQ:ORCL) has made a bid to buy the company for $9.3 billion. This deal has been rumored for some time but obviously few expected such a large premium or did not think the bid was certaintly coming as the stock is up about 18 percent at the time of this writing which is a lot for a tech giant. Here is what the sell side is saying.
NetSuite – analysts react
Should the transaction take place, Oracle would pay about 9x NTM EV / revenue (based on consensus estimates for NetSuite), above the average multiple paid in our precedent SaaS Software acquisitions analysis of 6.8x . Additionally, Oracl...
Anything can happen. At least, more things than you can imagine can happen.
Facebook, after trouncing yet another quarter’s earnings report, has now climbed to a market value greater than that of Berkshire Hathaway. It may be temporary, it may be forever. Regardless, at the current moment, a ten year old company with few physical assets and a small amount of employees is now worth more than an empire built by Warren Buffett over the course of 50 years.
How many people had the imagination to picture something like this as being within the realm of possibilities, let alone a likelihood?
The following are the M&A deals, rumors and chatter circulating on Wall Street for Wednesday July 27, 2016:
Sequenom Being Acquired by Lab Corp for $2.40/Share in Cash
Laboratory Corporation of America Holdings (NYSE: LH) and Sequenom, Inc. (NASDAQ: SQNM) announced Wednesday, that they have entered into a definitive agreement aunder which LabCorp would acquire all of the outstanding shares of Sequenom in a cash tender offer for $2.40 per share, for an equity value of $302 million.
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After a three-year bull run that more than quadrupled its value by its peak last July, IBD’s Medical-Biomed/Biotech Industry Group plunged 50% by early February, hurt by backlashes against high drug prices and mergers that seek to lower corporate taxes.
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