GDP +3.7%; Another Parallel To 2000
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As we have been noting for months now, we are in the back end of the economic expansion, where growth in consumption of services is driving the bus. Here is the breakdown of the most recent Payrolls report from FloatingPath by way of NFTRH 355.
For a country with a relatively strong currency and what it seems to view as a right, even a duty to consume, it makes sense.
In short, Goldilocks is in play with the world gripped in deflation. Goldilocks is usually a transitional thing. She tries 3 bowls of porridge, consumes one of them, takes a nap and then gets the hell out of there… or does she get eaten? I am hazy on my fairy tales.
Anyway, the GDP number is not surprising. So many parallels to the time period that led up to 2000’s climax are in play now, including this ‘strong dollar spurs consumption’dynamic. Another interesting one is the ‘Asian Contagion, part 2’ that is in play. So we continue to manage the market with the view that this is a correction only (currently in a well-anticipated ‘bounce’ mode), with no need to define what comes next.
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