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A Possible Recession Coming: What to Invest in During DifficultChart Analysis: The chart depicts the relationship between the M2 money supply, US Consumer Price Index (CPI), labor market trends, and historical recessions. Key observations include: Recessions: -Historical recessions are marked and correlated with significant economic downturns. -Each recession coincides with substantial drops in the labor market and fluctuations in the M2 money supply and CPI. M2 Money Supply and US CPI: -The M2 money supply (blue line) shows a steady increase over the years, reflecting ongoing monetary expansion. -The US CPI (orange line) follows a similar upward trend, indicating rising consumer prices and inflation. Current Economic Conditions: -The chart suggests a potential recession on the horizon, marked by the recent economic indicators and historical patterns. Bitcoin's Role in the Current Economic System: This is the reason the goverments wants to stop Bitcoin. People want out of their slave system where they create abundance for themselves with money printing while our labor value is always decreasing. Recession Expectations and Market Opportunities: Be open to a recession in the coming winter. The CME is having a meeting today where there is a 5% chance for a 0.25 rate cut and a 95% chance for a cut in September. Historically, there is a two-month window where the market booms and then rolls over into a recession after rate cuts. This supports the idea of a left-translated cycle and a longer multi-year cycle. For more information, see "The Fourth Turning." Investment Opportunities_ With this information, there can be good opportunities to get in early on investments in the precious metal markets like gold and silver, and also mining stocks. Production materials like copper, oil, and steel can be great shorting opportunities in the coming weeks and months. Conclusion: Understanding these economic indicators and historical patterns provides valuable insights for making informed investment decisions. While the future economic landscape looks challenging, strategic investments in precious metals and shorting opportunities in production materials could offer significant returns.
ECONOMICS:USM2Short
by martinxi5u4
2
A look at M2 Money Stock Out of curiosity I took a look M2 to see the trends over the years and how it compares to COVID and the last few years. I don't have any great revelations to share about what to do, but I thought the chart was interesting. I also did some research and used ChatGPT to help me create a summary about M2. Please note that I cannot guarantee the following text is perfectly accurate, I am not a financial expert or advisor, but it is an interesting overview. Enjoy. 1) Introduction: Money Stock Measure 2, or M2, is a comprehensive measure of the money supply that includes various types of financial assets held by the public. It encompasses M1 — which consists of the most liquid forms of money like cash and checking deposits — and adds less liquid forms such as savings deposits, time deposits under $100,000, and retail money market mutual funds. This broader measure provides a more complete picture of the available money within an economy than M1 alone. 2) Why M2 Matters to the Economy and the Stock Market: Monetary Policy Indicator: M2 growth rates can indicate the looseness or tightness of the Federal Reserve's monetary policy. Rapid growth in M2 may suggest a looser policy with potential implications for lower interest rates, while slower growth could indicate a tightening policy stance. Economic Health Predictor: Fluctuations in M2 can signal upcoming changes in economic activity. An expanding M2 typically suggests that more money is flowing into the economy, potentially boosting consumer spending and overall economic growth. However, if this expansion leads to inflation without an accompanying increase in real output, it could be detrimental. Interest Rate Influence: Since M2 impacts interest rates, it indirectly affects the stock market. Lower interest rates from an increased M2 can reduce borrowing costs and stimulate both capital expenditures and consumer spending, which generally supports higher stock prices. Inflation Expectations: Inflation can erode the purchasing power of money. An inflating M2 can lead investors to adjust their expectations, impacting bond yields and stock valuations. 3) As an investor, monitoring M2 can enhance decision-making in several ways: Growth Trends: Observing whether M2 is expanding or contracting can provide clues about future economic conditions and monetary policy directions, helping investors anticipate market movements. Asset Allocation: During periods of M2 expansion (indicative of lower interest rates), investors might favor stocks, particularly in sectors like consumer discretionary that benefit from increased consumer spending. Conversely, a slowdown in M2 growth could be a signal to move towards safer assets like short-term bonds, which are less sensitive to interest rate rises. Sector Impacts: Different sectors react differently to changes in M2. For example, financials might benefit from higher interest rates, while sectors sensitive to consumer spending could gain from an expansionary M2 environment. Inflation Hedge: Rapid increases in M2 that might lead to inflation suggest that investors should consider assets that typically perform well during inflationary periods, such as commodities or real estate. Global Considerations: For those invested internationally, understanding how M2 changes affect global markets and capital flows is crucial, particularly in how developed economies' liquidity influences emerging markets. 4) Conclusion: M2 is a critical economic indicator that offers valuable insights into future monetary policies, economic health, and market directions. It is not a perfect metric on its own, but by integrating M2 data into broader market analyses and considering its implications on different sectors and asset classes, investors can make more informed decisions, optimizing their portfolios to better navigate the complexities of financial markets.
FRED:WM2NS
by Dr_Roboto
Euro-Zone GDP Quarterly *3M (QoQ)ECONOMICS:EUGDPQQ (+0.3 %) Q1/2024 source: EUROSTAT The Eurozone’s economy expanded by 0.3% in the first quarter of 2024, the fastest growth rate since the third quarter of 2022, to beat market expectations of a marginal 0.1% expansion and gain traction following muted readings since the fourth quarter of 2022. The result added leeway for the European Central Bank to refrain from cutting rates to a larger extent this year should inflationary pressures prove to be more stubborn than previously expected. Among the currency bloc’s largest economies, both the German and the French GDPs expanded by 0.2%, while that from Italy grew by 0.3% and that from Spain expanded by 0.7%, all above market estimates. Compared to the same quarter of the previous year ECONOMICS:EUGDPYY , the Eurozone’s GDP grew by 0.4%, beating market expectations of 0.2%, and gaining traction after two straight quarters of 0.1% growth.
ECONOMICS:EUGDPQQ
by Mr_J__fx
$USGDP - Quarterly DataECONOMICS:USGDPQQ (Q3/2023) The American Economy ( ECONOMICS:USGDPQQ ) expanded an annualized 4.9% in the Third Quarter of 2023, slightly below 5.2% in the second estimate, but matching the 4.9% initially reported in the advance estimate. It still marks the strongest growth since Q4 2021. Consumer spending rose less than initially anticipated (3.1% vs 3.6% in the second estimate), but remained the biggest gain since Q4 2021. The slowdown was mainly due to services spending. Also, private inventories added 1.27 pp to growth, below 1.4 pp in the second estimate and both exports (5.4% vs 6%) and imports (4.2% vs 5.2%) increased less than initially anticipated. On the other hand, nonresidential investment was revised higher to show a 1.4% rise (vs 1.3% in the second estimate) as investment in structures surged way more than expected (11.2% vs 6.9%). Both residential investment (6.7% vs 6.2%, the first rise in nearly two years) and government spending (5.8% vs 5.5%) were also revised higher. source: U.S. Bureau of Economic Analysis
ECONOMICS:USGDPQQ
by Mr_J__fx
The Implications of the US Unemployment Rate - It Is Higher Now What is moving lately? The US unemployment rate has edged up. We can see from past cycles that when unemployment numbers started breaking above their downtrend, crisis occurred. Micro E-Mini Nasdaq Futures and Options Ticker: MNQ Minimum fluctuation: 0.25 index points = $0.50 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
FRED:UNRATEShort
by konhow
russian rates bonds and stocksHi all! I feel the approach of good times in Russia!!💓 On the chart - at the top in black is the rate of the Central Bank of the Russian Federation, next to it in blue - the yield rates on short-term bonds, at the bottom - the RTS. There will be a meeting of the Central Bank of the Russian Federation soon and everyone will be given the message that “the Central Bank should raise the rate by 2%.” Short debt is already trading at 18%+. How to practically apply this? The phase of raising rates always ends for stocks with a vigorous decline, a bang. The shares follow the RGBI index, so clients do not have any Russian shares. But! The main thing will begin after the Central Bank begins to reduce the rate - the stock market in currency terms can grow by 100..300% in €£$ It would be better for conservative comrades at this moment of lowering rates to withdraw money from deposits and invest in long bonds, both corporate and government. While we are in no hurry to switch to rubles and Russian shares, we need to wait - corrections - a real decrease in profitability on the Russian market (see two-year plans, ticker RU02Y) - changing the Central Bank’s narrative to lower rates.
ECONOMICS:RUINTR
by Vitaliy_Lebedev
$JPIRYY -Japan Inflation Rate YoYECONOMICS:JPIRYY (March/2024) The annual inflation rate in Japan ticked lower to 2.7% in March 2024 from February's 3-month peak of 2.8%, matching market consensus. There were slowdowns in prices of transport (2.9% vs 3.0% in February), clothes (2.0% vs 2.6%), furniture & household utensils (3.2% vs 5.1%), healthcare (1.5% vs 1.8%), communication (0.2% vs 1.4%), and culture & recreation (7.2% vs 7.3%). At the same time, inflation was stable for food (at 4.8%), housing (at 0.6%), education (at 1.3%), and miscellaneous (at 1.1%). Meanwhile, prices of fuel, and light dropped the least in a year (-1.7% vs -3.0%), with electricity (-1.0% and -2.5%) and gas (-7.1% vs -9.4%) falling at softer paces as energy subsidies from the government would fully end in May. The core inflation rate fell to 2.6% from a four-month top of 2.8%, slightly below forecasts of 2.7%. Monthly, consumer prices rose by 0.2% in March, the most since last October, after being flat in the prior two months. source: Ministry of Internal Affairs & Communications
ECONOMICS:JPIRYY
by Mr_J__fx
$GBIRYY - CPI (YoY)ECONOMICS:GBIRYY 2.3% (April/2024) source: Office for National Statistics The annual inflation rate in the UK eased to 2.3% in April 2024, the lowest since July 2021, compared to 3.2% in March and market forecasts of 2.1%. The largest downward pressure came from falling gas (-37.5% vs -26.5% in March) and electricity (-21% vs -13%) cost, due to the lowering of the Office of Gas and Electricity Markets (Ofgem) energy price cap in April. At the same time, prices slowed for food (2.9%, the lowest since November 2021 vs 4%) and recreation and culture (4.4% vs 5.3%). On the other hand, the largest, partially offsetting, upward contribution came from cost of motor fuels. The average price of petrol rose by 3.3 pence per litre between March and April 2024 to stand at 148.1 pence per litre, up from 145.8 pence per litre in April 2023. Prices also rose faster for restaurants and hotels (6% vs 5.8%) and miscellaneous goods and services (3.6% vs 3.4%). Compared to the previous month, the CPI rose 0.3%.
ECONOMICS:GBIRYY
by Mr_J__fx
Shelter Inflation. The Tail That Wags The DogInflation is finally cooling off as inflation gradually loosened its grip on Wall Street and the economy in 2023, raising hopes for a gentler Federal Reserve and further gains for the market in 2024. Stocks rallied to their best 9-weeks stripe over the past 20 years in November and December, 2023 (so-called 'Santa Rally') as investors raised their bets that the Fed is done hiking interest rates to fight inflation. 6Mo USCPI Inflation was at its lowest levels since Covid-19 pandemic in early 2023 Top 4 U.S. stock market Indices were in rally in 2023 The economy has cooled under the weight of rising interest rates, as the central bank intended, but remains surprisingly resilient. Energy prices are down. Food prices are mellowing out. But the cost of having a place to live is still rising much faster than just about every other essential. U.S. Consumer Price Index inflation Headline inflation was up 3.1% from a year ago, and so-called "core" inflation, which excludes volatile food and energy prices, was up 4%. But the cost of shelter, which is the biggest component of the basket of goods the BLS uses to measure the cost of living, was up 6.5%. "The shelter index was the largest factor in the monthly increase in the index for all items less food and energy," read the Bureau of Labor Statistics report accompanying the latest data on consumer prices. "The shelter index increased 6.5 percent over the last year, accounting for nearly 70 percent of the total increase." When the covid-19 pandemic hit, the cost of housing surged as those who could afford it sought out bigger homes and many city-dwellers transitioned to the suburbs. What goes into Consumer Price Index That and a glut of savings unhindered by low interest rates combined to exacerbate what had been a long-simmering Housing crisis the U.S. But now that baked-in price hikes and rising mortgage rates spurred by tightened Federal Reserve monetary policy have put a bit of a damper on things, the housing market is also starting to cool. U.S. Single Family Home Prices in "Bubble Mode" 30Yrs Fixed Mortgage Rate is at 20Yrs Highs. 30Yrs Mortgage Annual Payment U.S. Single Family Home, only Interest. Housing prices tend to be “much stickier” than most costs, which means that when they rise we feel it more - and for longer (read - "for ever"). Housing prices do not compressed like just baked iPhone or iMac later in few years of its release. - Does all af that mean that pre-covid levels of relative housing affordability are coming back? - Sure "No". But at least American wages, which are still rising faster than before the pandemic thanks to increased worker power, will have a little chance to make up some lost ground. The issue is still Federal Reserve' lagged tightening policy, that is "The Tail That Wags The Dog".
FRED:CUSR0000SAH1
by PandorraResearch
10/2 Inverted Yield StrategyThe inverted Yield is basically 6/6 as an indicator of an oncoming recession. At initial inversion the stock market sees initial growth as rates go higher. It isn't until on average 16-19 months that a recession occurs after initial inversion. www.putnam.com A study by Bloomberg tracked performance of the S&P 500 against the 2 and 10 year US treasury inverted yield curve and found that the best time to sell equities in the stock market was when the inverted yield begins rising again and is at the -0.15 level. The best time to get back into the market and restart your DCA is when the inverted yield rose above the 2.15 level. This period typically takes 660-700 days to occur. www.bloomberg.com On April 1, 2022 the 2/10 yield curve inverted. As of today we are at 19 months. Today October 20th, 2023 the inverted yield curve turned up at -0.15. The vertical red lines are selling of equities at -0.15 and the green line indicated repurchasing of equities at the 2.15 line for the last two recessions. *This is not financial advice. Invest at your own risk and do your own due diligence.
FRED:T10Y2YShort
by EasyZabbo
2
Trump / Rates / Dollars / Coins, OH MY!Interest Rates and the Dollar Interest rates, set by central banks, are a critical component of monetary policy. The Federal Reserve (Fed) in the United States uses interest rates to control inflation and stabilize the economy. When the Fed raises interest rates, it becomes more expensive to borrow money, which tends to slow down economic activity and reduce inflation. Conversely, lowering interest rates makes borrowing cheaper, encouraging spending and investment, which can stimulate economic growth. Impact on the Dollar: Higher Interest Rates : When interest rates rise, the yield on U.S. government bonds and other fixed-income securities increases, attracting foreign investment. This inflow of capital strengthens the U.S. dollar as investors buy dollars to purchase these higher-yielding assets. Lower Interest Rates: Conversely, when interest rates are lowered, the yield on these investments drops, making them less attractive. This can lead to capital outflows and a weaker dollar as investors seek better returns elsewhere. Interest Rates and Cryptocurrency Impact on Cryptocurrencies Cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) are often seen as alternative assets. Their relationship with interest rates can be complex: Rising Interest Rates: Higher interest rates can negatively impact cryptocurrencies. As safer, yield-bearing investments become more attractive, investors might shift their funds from speculative assets like cryptocurrencies to bonds and savings accounts. Falling Interest Rates: Lower interest rates can make traditional investments less attractive, potentially driving more investment into riskier assets like cryptocurrencies in search of higher returns. The Importance of Policy Decisions Independent of Political Agendas Central Bank Independence: The independence of central banks from political influence is crucial for maintaining economic stability. When monetary policy decisions are driven by economic data rather than political agendas, it helps ensure that actions taken by central banks are aimed at achieving long-term economic goals such as controlling inflation and maintaining employment levels. Transparency and Credibility: Independent central banks are more likely to make transparent and credible policy decisions, which can build market confidence. Economic Stability: Policymaking that is insulated from short-term political pressures helps avoid economic instability that might arise from politically motivated decisions. Recent News: Assassination Attempt on Donald Trump and Its Impact on BTC Markets Recent News: There was an assassination attempt on former President Donald Trump, which has created significant political and market turbulence. Impact on BTC Markets: Market Reaction: Such high-profile political events can lead to increased uncertainty and volatility in financial markets. Bitcoin, often seen as a hedge against political and economic instability, may experience increased buying interest as investors seek to protect their wealth. Price Movements: Following the news of the assassination attempt, Bitcoin's price saw notable fluctuations as traders reacted to the heightened political risk. Conclusion Interest rates play a pivotal role in influencing the value of the U.S. dollar and cryptocurrencies. Central bank decisions on interest rates, when made independently of political agendas, contribute to economic stability and investor confidence. Recent political events, such as the assassination attempt on Donald Trump, highlight the sensitivity of markets, including cryptocurrencies, to geopolitical developments. Understanding these dynamics is essential for investors navigating the complex financial landscape.
ECONOMICS:USINTREducation
by moneymagnateash
2
UNEMPLOYMENT / FED FUNDS RATE - PLAY BOOKUNEMPLOYMENT / FED FUNDS RATE - PLAY BOOK This post I intend to explore with you the cyclic relationship we can observer between: 1) US Unemployment Rate (BLUE), 2) 21D SMA (Orange) based in unemployment data, and 3) Resultant Recessions (Gray Bars) Historically, the general play book / sequence of events suggest once we break the 21 Day SMA (orange line), it is the start of unemployment unwinding and we lead into a recession. As the 'FED FUNDs RATE' is the artificial tool used to 'Guide' the credit market (politically correct explination), the obvious question then is; "What is the relationship / behavior of interest rates historically with this trend? Are we experiencing similar behaviour to the last 30 - 40 years?" The Red line show the FED funds rate on the chart. The below sequence of events show how these variable play with each other: The story goes: the FED increases the 'FED FUNDS RATE' (aka interest rates) because low periods of interest rates is resulting in a 'HOT' economy and causing inflation (i.e. market forces the FEDs hand to raise interest rates as the return for lending money to credit markets does not match the current risks). At some point during interest rate rises: 1) FED rise in interest rates is held constant (the lagging effect of higher rates start to hit the economy resulting in slowing down economic activity - i.e. spending) 2) Record low unemployment starts to rise (Cross of 21D SMA historically has signaled a point of no return) 3) Fed start to drop rates due to employment increase, deflationary market disruption 4) Unemployment begins to rapidly increase 5) Recession WHERE ARE WE NOW? According to this play book, we are in currently in step 2 and approaching point 3 . If you find this post interesting, you may find my discussion around the 2 Year Treasury Bond Yield vs FED Funds Rate interesting. This relationship is what I was using to speculate interest rate rises before they happened, and that they would be higher than people were expecting when there was talk of rates rising... The Market in all cases will eventually win...
FRED:UNEMPLOY
by Brodie
1
Macro View Shows 2-4 Month Max And Then It Starts!Traders, Some rather ominous signs are showing in various markets not least of which includes the U.S. housing market. As you know, we have been periodically tracking the USHMI as a key leading indicator to show us where and when our coming U.S. (perhaps global) recession begins. We are close if we have not already begun, but I imagine there will be no ability for denial in about 2-4 months time. Before then, markets may continue to blow off and I still expect Bitcoin to hit our 85k target. Today we'll review our USHMI chart along with other key charts for further clues mapping future trajectory.
ECONOMICS:USHMIShort
by stewdamus
$USIRYY -CPI# *M print (post AA+)- Awaiting CPI# numbers readings for ECONOMICS:USIRYY on August 10th (today) post US being Down-Graded to AA +. While on the 9th of August ECONOMICS:CNIRYY came deflationary on the other side of the world Consensus sits at 3.1% (0.1% increase) and some to 0.3% increase at 3.3% for ECONOMICS:USIRYY Economists forecast Inflation rising up again on a steady pace for the rest of 2023 and the entering of 2024 for coming down YoY from 9.1% to 3% On the last ECONOMICS:USINTR Rate Hike Decisions following a Month of Breath, our pal, Jerome Powell stated during his speech regarding Fed's seeing inflation coming up on months to come not being total uder control. This was aswell one of many reasons they didn't felt confident to stop the Rate Hiking . He aswell stated that Federal Reserve does not see Inflation coming down to their Target Norm of 2% CPI by 2025, and they fimrly prompt a 'Soft Landing'. How about another joke, Powell ! It's not about Money , its about sending a Message . Everything Burn ... TRADE SAFE *** Note that this is not Financial Advice Please do your own research and consult your own financial advisor before partaking on any trading activity based solely on this idea.
ECONOMICS:USIRYY
by Mr_J__fx
5