When it rains, it pours:
Another appearance on Kudlow & Company tonite, from 5:00 to 6:00 pm. Its for most of the show.
More of the same as last time: why this is hardly a Goldilocks Economy, and the issue of Headlines versus Underlying Data: weak jobs creation, Retail Sales, Inflation, GDP, Retail Sales, Bankruptcy, Real Estate, Savings Rates, Yield Curve, Account Balances, etc.
Once again, I am the realist/Bear, along with Paul "He ain’t no Maestro" McCulley" and Bullish commentator Don Luskin.
Regarding ‘Headline vs. underlying data’, have you made the case to Kudlow et al. of how the method used to measures housing costs (ie, rents) distorts the CPI downward? It is a large chunk of core CPI.
How about mentioning HEW and the impact on the economy and people?
The chart over at calculatedrisk is interesting.
Once again, I think you were right on all the issues, imo. Kudlow always tries to play up the Washington card and how it can help the market. Clearly you are right, the market cares more about inflation, growth and interest rates and not some bs going on in Washington.
Especially agree on Malaysia. It was my top international pick this year. Could break out soon according to the chart.
Also in recent days, Kudlow and his guests have been saying that bonds matter more than gold. What they fail to mention is that bonds havent crashed only because of huge support from Japan and others. Further, gold leads interest rates. History shows us this. The fundamentals have not changed one bit.
Its an economy that is held together by asset bubbles and an easy monetary policy. The stock market continues to make new highs despite continually deteroriating technicals. The powers that be prop up the market at key support points.
Fundamental havent changed. Gold should go to $700 in 2006 and precipitate some kind of crisis.
Cant believe that guy said 20-25% up market with rates at 5.5%! What the hell is he smoking. The market can go up that much only if we have 50% inflation.
You seem to be one of the very few on wall street that actually does analysis, rather than reading the headlines.
Larry would be happier if you were one of the Bush cheerleaders.
Seriously, you do a great job of being cordial and maintaining your independence while he’s being pompous and trying to push everyone into his camp.
Barry
You’ve mentioned your possible bullish outlook on Malaysia. Could you outline a couple of the reasons for this? After doing some light research, I haven’t been able to determine why it may be a good play–though I haven’t seen any good reasons to argue against it.
On bonds … you should ask Larry sometime how it is that bonds are still good for predicting inflation but no longer good for predicting economic health.
To clarify … spreads between long bonds and TIPS are narrow indicating inflation expectations are low, however an inverted yield curve no longer is useful in predicting a slowdown. It seems the long bond should be good for both or neither – not used selectively.
I see Don “Stupidest Man on Earth” Luskin is still successful at convincing people he is an expert in anything other than being an absolute pompous ass. I didn’t see the show, did he bring his pom-poms?
Can you comment on the Federal debt limit:
Haven’t heard a word about this:
http://www.publicdebt.treas.gov/opd/opdpenny.htm
Last increase in Public Debt limit:
108th CONGRESS
2d Session
S. 2986
Subsection (b) of section 3101 of title 31, United States
Code, is amended by striking `$7,384,000,000,000′ and inserting `$8,184,000,000,000′.
Passed the Senate November 17, 2004.
Should hit the ceilling soon but have not read anything about raising the limit.