Did Last Thursday's CPI Number Really Change the Outlook Much?
Last week's CPI number does not signal an upcoming significant drop in inflation. More importantly, a reversal in long-term interest rates...during a bear market...actually signals LOWER stock prices, NOT higher prices...because they signal a recession.
Table of Contents:
1) Could this rally last a lot longer? Key levels to watch.
2) Inflation is still extremely high…and it’s not going to collapse.
3) A mere mild decline in earnings next year will be very bearish for the stock market.
4) When long-term rates roll-over in a bear market, it’s BEARISH for stocks.
5) Politics…Neither party should be proud of their performance in the 2022 midterms..
6) Summary of our current stance.
As I highlighted last weekend, I was scheduled for hip replacement surgery this past week...and I did indeed have that surgery. Since I'm in recovery mode, this weekend's piece is going to be much shorter than usual. I will return to the normal piece next weekend (and my regular "Morning Comment" will return next week as well). Thank you very much.