The economic news continues to demonstrate an increasingly strong economy. Business surveys for the manufacturing and services sectors indicated strong activity and that employment rose at the fastest pace since June 2022. Speaking of employment, Weekly Jobless Claims remain at historic lows. The one remaining weak link in the economy is housing, with September Starts and Permits both down on the month and year over year. Overseas, business surveys continue to report moderate growth. However, the financial markets want to ignore those facts and swing wildly on the election cycle headlines. The S&P 500 ended the week at -0.47% with Foreign Developed at -1.52% and Emerging Markets at -2.62%. In the US, oddly   .... (click for more)

The real economy is defying consumer sentiment. The manufacturing sector’s growth is accelerating at a strong level. The services sector’s growth is also accelerating at a strong level. The August Jobs Report showed 162,000 new jobs; when adjusted for upward revisions to the prior two months’ reported jobs, the number is a very strong 217,000 new jobs. In watching “what they do, not what they say”, August Core Retail Sales came in at a very strong 5.6% versus 4.7% the prior month, year over year. However, inflation is driving the headlines and market sentiment. While energy costs are the obvious culprit, August Core CPI and Core PCE Price Index declined to 2.4% and 2.7% (adjusted for prior month’s revision), respectively, suggesting underlying inflation is moving...... (click for more)