Macro Trends/Forecasts

Jeff Miller

"The Man Who Called Dow 20,000" --CNBC

ISM Services Echo

The ISM Services report is an echo of the manufacturing news.  If you annualize the result, ISM sees it as consistent with GDP growth of 1.4%.  The comments are also similar in tone -- reference to tariff effects both on costs and general uncertainty.  Labor markets remain tight, generating cost pressures there as well.

My chief concern is incipient inflation, which will be a red flag for the Fed.  The recent results have been below my "base case" of 2% growth, but not indicative of a recession.  Prepare for an over-reaction to a modest "miss" on the employment numbers, something well within the margin of error.

None of the comments referenced interest rates and the survey was before the impeachment news, so the Presidential explanations for the weaker economy and stock market do not hold up.

Jeff Miller provides Economic Analysis as well as Market Forecasts as one of the original contributing analysts at FATRADER. A quantitative modeling expert and former university professor who is the #1 Economics contributor at Seeking Alpha, Jeff is regarded as an expert on economics, market reaction to news events, and computer-based trading.
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