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Strategies & Market Trends : Bear!
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To: Sean Collett who wrote (192)12/1/2023 11:00:21 AM
From: Sean Collett  Read Replies (2) of 266
 
My point on corporate margins and not having inflation to protect them has been highlighted by the Fed's Daly:


Again, my estimate is that in 1H 2024 we will see a very rapid rise in unemployment once holidays wrap up. This will then change everyone's perception on how strong the consumer is. They have been racking up debt like crazy while unemployment has been at 3.9%.

At this point this is all just a math problem that will solve itself despite how one feels about the economy. Disinflation/deflation prevent corporations from raising prices to keep margins strong and with inventories so high they will need to drop prices to move it.

ISM report came out today and paints that same picture if we look at customers inventories compared to everything else that is contracting:



The increase in customers inventories will also feed into future ISM reports as this will then impact future production demands. If there is an excess of inventory they can't move then there will be a slowdown in future orders.

This ISM contraction by the way is the longest stretch in 40 years.

US continuing claims continue their rise:


And let's not ignore the fed paper that shows our consumer has found new ways to leverage up too. Unsecured loans seem to be the latest fad outside just credit cards:





Seems in a running of the bulls I am only one of the few vocal bears around. Despite what the news may say, all the signs of pain are there.

US Steel is laying off 1,000 (400 were temporarily laid off in Oct and now another 600 added) workers as it idles their Granite City plant.


I struggle to figure out where to put money though as there isn't a clear path for shorting given the mania in the market. Cash seems to be the safest option at the moment until a clearer pitch is in view. Seems I am the only one posting here with a heavily bearish view, but there are other members. Curious on the groups thoughts (backed by data) on where you think things are headed and how you're positioning.

-Sean
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