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Strategies & Market Trends : US Inflation and What To Do About It -- Ignore unavailable to you. Want to Upgrade?

To: d[-_-]b who wrote (835)	3/13/2019 11:29:38 AM
From: RetiredNow	Read Replies (1) \| Respond to of 1504

Well, that is correct. A stock friendly Fed and President and a divided government does seem to be the best of all worlds for stocks. If Powell is on Trump's side to help him get re-elected, then he can make it happen. I've always thought the Fed is the 900 pound gorilla in the economic room. Bernanke got Obama re-elected with his massive QE3 program in Sept'12. So Powell could do the same thing for Trump. That could bode very well for stocks in 2019 and 2020. Having said that, what about the other scenario? Right now, most of the major leading indicators are rolling over and some massively so. The gap between fundamentals and stock prices is giant. PEs are extraordinarily stretched. All valuations metrics are experiencing a six sigma event. At this point, it seems like gambling to hold on to stocks. What is driving you to think it's better to hold on, besides faith in Trump and Powell? How can you stomach the risk?

To: d[-_-]b who wrote (835)	3/13/2019 11:34:39 AM
From: RetiredNow	Respond to of 1504

Residential Spending Slumps For 6th Straight Month As Infrastructure Spending Soars Most Since 2003 The headline construction spending print was celebrated, rising a better-than-expected 1.3% MoM (the most since April 2018) in January, but below the surface the story is notably mixed. Private Residential building spending dropped 0.3% MoM - the sixth straight monthly decline (and private residential home improvement spending fell 0.3% in Jan. to $181.3b). But the headline was saved by a surge in non-residential building spending of 2.4% MoM - the biggest jump since Jan 2016. @Takis2910 also noted that this month's headline construction data is upwardly biased thanks to heavy downward revisions going back several months and in fact adjusted for inflation, real total construction spending is down 4.7% YoY - "ominous" as he notes... And it was government spending that rescued the headline as public construction rose 4.9% in Jan - the largest increase since March 2004. Government construction spending was 24.5% of total in Jan thanks to a massive surge in infrastructure spending on Highway and Street improvements... So, the summary of today's construction spending data is that non-governmental spending is extremely weak (the biggest YoY drop since Dec 2010), signaling a lack of confidence... ...and only government-spending is saving the economy.