Sorry! Not Today Economic Armageddon Folks

So much to cover on a holiday weekend. I think I will limit this to some economic topics. I totally forgot that the markets are closed today in observance of June Teenth. Thankfully, an old buddy is in town from CA and we’re going to play golf in New York.

Let’s start with the consumer. As I read comment after comment about impending recession since 2022, the latest retail sales printed +.9% for May, well ahead of the +.6% expectation. Time and time again we have seen the economy and consumer outperform what the experts expected. Ya think there’s some bias? I do. I mean, how can so many expert economists get it so wrong for so long?

Economists seem to be too focused on how people “feel”. Consumer Sentiment is below. Notice anything unusual on the right side of the chart? The markets are soaring. Investors are making good money. There is greed, giddiness and euphoria. We know the consumer is spending. Yet, when asked about their “feelings”, the consumer feels terrible. Of course, cost of living is a major driver.

The skeptics will argue that while the consumer may be okay, manufacturing is in the toilet. Well bears, the May readings for the Purchasing Managers Indices not only showed a continued acceleration, but a real surge higher. The “BUT BUT BUT” crowd can no longer invoke Iran although it was glaringly wrong anyway. The chart below should speak for itself; the strongest since early 2022.

Don’t believe it? Here is a totally different one with a different set of data, source and calculation. It shows the strongest growth since 2022.

At least for now, we have the manufacturing sector hitting on all cylinders and the consumer doing just fine.

A beautiful weekend is shaping up in CT. After some Friday golf, there is a mixed couples, Hawaiian event late today which should be fun and interesting. After even more golf tomorrow, we head to one of my favorite places on earth, The Place, with friends. I have been going for 50 years and it never, ever gets old. So unique. So much fun. So laid back. The US Open at famed, Shinnecock Hills is also this weekend. Shinny is one of the courses I have always wanted to play, but could never make it happen. Father’s Day rounds out the weekend with some family golf and dinner. Nothing better than to have all three kids home!

On Wednesday we bought more QLD and MQQQ. We sold XRT, some FDN and some XLC.