Three Things to Know & Watch

Aug 28, 2023

By Bill Hornbarger, Chief Investment Officer
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Three Things to Watch

  • A big week of economic news with the Personal Consumption Expenditures (PCE) due on Thursday. PCE is the Fed’s favored measure of inflation and remains well above the Fed’s 2% target for core PCE (excluding food and energy). Both overall and core PCE are expected to increase 0.2% month-over-month. That would result in slight upticks to the year-over-year readings which are forecast at 3.3% and 4.2%, respectively as the comparisons to last year get less friendly as we move through the balance of the year.
  • On Friday, the August employment report will be out with non-farm payrolls forecast to increase 150,000 and the unemployment rate steady at 3.5%. That would be the smallest increase since December 2020.
  • Also on Friday, the Institute for Supply Management survey on manufacturing will be released. It is a diffusion index with readings below 50 indicating contraction. It has been below that level for 9 consecutive months and the consensus forecast is for a reading of 47 with most of the sub-components also showing weakness.

Three Things to Know

  • Since 2020, the U.S. has printed nearly 80% of all U.S. dollars in circulation. To put that in perspective, at the start of 2020, we had $4 trillion in circulation. Now, there is nearly $19 trillion in circulation, a 375% jump in three years. (Source: The Kobeissi Letter)
  • Nineteen trading sessions have come and gone in August without a single back-to-back gain in the S&P 500. If that continues, it will be the first month without two consecutive up days since April 2002. (Source: Bloomberg)
  • The median home value to income ratio in the U.S. now stands at a record 4.5x. This is 45% above the historical average of 3.1x with the median home payment now at a record $2,800 per month.  Meanwhile, the median rent price in the U.S. just hit a record $2,050 per month. . (Source: The Kobeissi Letter)


The above information reflects the current opinion of the author. It is based upon sources and data believed to be accurate and reliable. Opinions and forward-looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security mentioned.