The Return of “Inflation Watch”: It Is Cool to Worry About Inflation Again

During the Financial Crisis of 2008-2009, a friend and I were convinced that the Federal Reserve’s extraordinary monetary measures would eventually create outsized inflationary pressures. We came up with a blog called “Inflation Watch” as a way to educate each other on price dynamics and to alert anyone else interested. The subsequent economic expansion came … Read more

Stock Chart Reviews – Apple Takes the Lead Role In A Stock Market Running Low On Fuel

Stock Market Commentary I gave the summary for the week in my last “Market Breadth” post. I will just add here that the stock charts are full of images of a stock market running low on fuel. I tell just a small part of the narrative below. Stock Chart Reviews – Below the 50-day moving … Read more

Stock Chart Reviews: Snapshots from A Manic Market

Stock Market Commentary In last week’s decision on monetary policy, Federal Reserve Chair Jerome Powell directly and fully acknowledged inflationary pressures in the economy. Perhaps lost in the inflation buzz was Powell’s quick commentary on financial stability during the Q&A session: “…asset valuations are somewhat elevated, I would say.” Of course, various folks in the … Read more

J-Pow’s Hawkish Jawboning Sparked A Fresh Market Jolt – The Market Breadth

Stock Market Commentary Federal Reserve Chairman Jay Powell, aka “J-Pow”, finally decided the time has come to drop the descriptor “transitory” from America’s current experience with inflation (see the 37:00 mark in the video below). J-Pow even acknowledged that “it is therefore appropriate…to consider wrapping up the taper of asset purchases…perhaps a few months sooner” … Read more

The Rally Slammed Into A Wall of Inflation – The Market Breadth

Stock Market Commentary And just like that, the bullish expansion of market breadth hit a wall…a wall of inflation. The October Consumer Price Index (CPI) for all urban consumers apparently surprised financial markets by soaring 0.9% from September and 6.2% over October, 2020. The chart below shows that both surges are at the high end … Read more

A Rare Stumble for the Stock Market As Oversold Conditions Loom – Above the 40 (June 18, 2021)

Stock Market Commentary The Federal Reserve seemed to change the rules of the game. To-date, easy money policies and stubborn dovishness in the face of rising inflation was a formula for higher asset prices, reflation and inflation-friendly trades, and even rising fears of an over-heating economy. Last week, Federal Reserve Chair Jay Powell shifted the … Read more

Normalization Places Fresh Pressures on the Spring Selling Season – Housing Market Review (May, 2021)

Housing Market Intro and Summary The Spring selling season looked like it started strong for new home sales. The data for April reveal a story evolving differently. Absolute inventories rose for both existing and new homes and yet sales declined. Housing starts also suffered a setback. Median prices of homes soared, especially for new homes, … Read more

A Stock Market Resigned to Chopping and Churning – Above the 40 (May 21, 2021)

Stock Market Commentary Last week delivered another key test of support levels for the stock market. The major indices passed their individual tests, but the week ended with no resolution. Bulls and bears are battling between short-term ranges that are chopping and churning traders. With the stock market resigned to this kind of chop, patient … Read more

Turkish Central Bank Hiked Policy Rate, But Too Late for the Turkish Lira?

The monthly chart of the U.S. dollar versus Turkish lira (USD/TRY) shows a near relentless and massive devaluation.

The Turkish lira suffered another run of sustained weakness this month. Weakness in the Turkish lira drove USD/TRY to new all-time highs. On Thursday, the Central Bank of the Republic of Turkey (CBRT) tried yet again to stop the bleeding. The Turkish Central Bank hiked its policy rate an entire 200 basis points from 8.25% … Read more

Turkish Lira Survives A Rate Cut And Comes Out With Stronger Prospects

The U.S. dollar versus the Turkish lira (USD/TRY) is rapidly heading downward for a test of 200DMA support.

Perhaps President Recep Tayyip Erdogan was right all along? It seems rate cuts are exactly what Turkey needs. As global central banks pedal backward on monetary policy, the Central Bank of the Republic of Turkey (CBRT) stands out with its extremely high rates. The CBRT got here as part of a fight against persistent and … Read more