Engineer/Investor. Follow along for failed attempts at humor, drab economic charts, and political takes that will make you unfollow. The voice of macronomy.io
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This is a view of the S&P 500 from space. It helps to remember that this is the view that matters.
Sit back, relax, and wake me up if a market circuit breaker trips. Follow the macro at -> macronomy.io
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When investors hold a lot of stock relative to historical norms, there are few new buyers left. Future returns tend to be lower.
New to macronomy this week: the Aggregate Investor Allocation to Equities (AIAE) estimates what share of all US investor portfolios sits in stocks rather than in debt, using Jesse Livermore's 2013 formula. It is at an all time high. macronomy.io/models/aiae?fro…
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Truflation's CPI reading has jumped by 25 basis points in the last 2 days. It has been well below official CPI for some time now. They often move in the same direction over time.
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The unemployment rate is back at 4.2%. This is where it was two years ago. This was the first move up since Feb. macronomy.io/models/unemploy…
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Trimmed Mean PCE hit 2.19%. It hasn't been this low since July 2021. At one point, Warsh calimed this was his preferred inflation gauge.
macronomy.io/models/trimmed-…
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Bartleby retweeted
Core PCE much cooler than expected, as previewed:
PCE 0.3% MoM, Exp. 0.3%
PCE 3.4% YoY, Exp. 3.7%
PCE Core 0.2% MoM, Exp. 0.3%,
PCE Core 3.0% YoY, Exp. 3.3%
Why PCE may surprise to the downside: the Bureau of Economic Analysis updated methodology for calculating inflation in three components is expected to trim August year-on-year change by a few tenths of a percentage point.
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🚨 New feature drop on macronomy.io - see historical recessions or S&P 500 bear markets overlaid on any of our models.
It is now easy to see how any model performed during your favorite recession or bear. My favorite was GFC, hands down.
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CPI 0.4% MoM vs 0.4% (Expected)
CPI Core 0.3% MoM vs 0.2%
CPI 3.4% YoY vs 3.4%
CPI Core 2.4% YoY vs 2.4%
macronomy.io/models/core-cpi…
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US Unemployment 4.1% as expected. 162,000 jobs added in August vs only 55,000 expected. Time for a hike?
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This metric says the market is the most overvalued it has been in 25 years.
Jan 2021 - that is the last time stocks were this expensive relative to bond yields according to ERP.
macronomy.io/models/erp?from…
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This is not as big a problem as it may seem. According to the Fed Board FEDS note from April 2026, we need less than 10k jobs a month for break even at this point. All these "below expectations" job reports are more than enough.
Private payrolls rose by 38,000 in August according to ADP research. Economists expected a gain of 47,000. This was the smallest increase since the start of the year.
Michael McKee reports bloom.bg/4gOWFAo
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The Quits Rate remains at an almost 12 year low (excluding covid). People are not leaving their jobs voluntarily.
macronomy.io/models/quits-ra…
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JOLTS 1 year chart
macronomy.io/models/jolts?fr…
JOLTS job openings at 7.271M vs 7.330M expected. JOLTS is the number of open jobs employers are advertising.
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JOLTS job openings at 7.271M vs 7.330M expected. JOLTS is the number of open jobs employers are advertising.
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This morning's BBK reading of -0.60 continued to edge away from the danger zone.
The BBK is a useful single-glance check on overall economic momentum without having to aggregate dozens of series yourself. It boils down 500 economic time series into a single number with a predictive track that rivals the Conference Board's better-known Leading Economic Index. It has broader inputs and less revision volatility.
macronomy.io/models/bbk?from…
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