Consumer Economy
- Personal Income (PI) 26.40T +79.9B (+0.30% m/m) (prior +0.12% m/m)
- Auto/Light Truck Sales (ALTSALES) 16.1M +308.0K (+1.95% m/m) (prior +2.02% m/m)
- GDP (GDP) 31.10T +612.3B (+2.01% q/q) (prior +1.48% q/q) +1272.8B
- Personal Income (PINCOME) 26.20T +210.1B (+0.81% q/q) (prior +1.05% q/q)
While [December] auto sales remain weak (5 year low), heavy truck sales bounced sharply higher. Are we BOOMING again?
Personal Income [Q3] (PINCOME) grew at 3.24% annualized. That is not keeping up with inflation. Meanwhile, [AI] GDP for Q3 was BOOMING, at +8% annualized. The monthly income series (PI) [November] moved slightly higher (3.6% annualized, but remains well below actual inflation.
I suspect: the covered-up Magic Money Machines run in the background, while little-people income is stagnant.
Next up: time for some (stimmy) “Tariff” checks. Now that’s “real money printing”, since it will all be spent directly into the economy rather than sitting in someone’s account collecting interest.
Credit & Rates
- Total Bank Credit (TOTBKCR) 19.05T +54.9B (+0.29% w/w)
- Fed Balance Sheet (WALCL) 6.58T +2.9B (+0.04% w/w) (prior +0.12% w/w)
- US 30 Year Mortgage Rate (MORTGAGE30US) 6.09% +3 bp
- 3-Month Treasury (DGS3MO) 3.67% +0 bp
- 1-Year Treasury (DGS1) 3.53% -2 bp
- 10-Year Treasury (DGS10) 4.25% +1 bp
- 20+ Treasury ETF (TLT.N) +0.15% w/w (prior -0.15% w/w)
Bank credit shot higher this week – 15% annualized. That’s the second week it has done this. Bank credit looked ugly a few weeks back, but it has recovered. That’s inflationary. You can see overall y/y change in bank credit (red line) is now around 6%.
Fed printed a tiny amount of money (2.9B) this week. It isn’t visible on the chart, so I didn’t post; annualized rate = 2.08%.
Not much change in rates this week – a slight increase at the long end of the curve.
TLT was smashed hard on Tuesday, but then spent the rest of the week recovering. Lots of things sold off hard on Tuesday. “Sell America Day”, it appeared to be.
CME Fedwatch Tool projects a 4% chance of one cut at (next Wednesday’s) January 28th meeting.
Currencies
The dollar turned to confetti this week, plunging 1.80 [-1.81%] to 97.40. That’s a big move, a new 4-month low, and the buck is back in a downtrend in all 3 timeframes. The
by irishprince 
