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The Morning Call--FOMC Minutes Reiterate Powell's Reiteration Of His Reiteration

Feb. 18, 2021 9:25 AM ETHRL, SHW
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The Morning Call


The Market


Wednesday in the charts.

Bitcoin Roars To Record Highs As Inflation Soars, Bond 'Rout' Stalls

Three factors that could drive stock prices lower.

Why the stock market's 'worst-case' scenario depends on these 3 ingredients

For the bulls.

Cupcakes and Pizza are Delicious - All Star Charts -

A headwind for bonds.

Rising Interest Rates Create Headwinds For Bonds In 2021



The Economy


Weekly jobless claims came in at 861,000 versus projections of 765,000.

Initial Jobless Claims Unexpectedly Jump Due To Surge In IL, CA Claimants

Month to date retail chain store sales declined less than in the prior week.

December business inventories rose 0.6% versus expectations of +0.5%.

January industrial production increased 0.9% versus estimates of +0.5%; capacity utilization was 75.6 versus 74.8; housing starts declined 6% versus -0.1% but building permits were up 10.4% versus -0.2%. January export prices were up 3.3% versus +0.4%, import prices were up 1.3% versus +1.0%.

Rentor Nation Returns? Multi-Family Starts, Permits Soared In January

The February Philadelphia Fed manufacturing index was reported at 23.1 versus forecasts of 20.0; the February housing market index came in at 84 versus 83.

NAHB Housing Market Index: "High Demand Offsets Higher Costs - For Now"



It is all about reflation now (must read).

It's all about reflation now


Why Printing Money May Not Create Inflation

Also: Powell should stick to his guns.

The illusion of wage growth could haunt the Fed

An alternative measure of slack in the economy.

An Alternative Proxy Measure for Slack

Update on big four economic indicators.

The Big Four - Industrial Production: Up 0.9% in January

Total household debt rose in Q4 2020.

NY Fed Q4 Report: "Total Household Debt Increased in Q4 2020, Newly Originated Mortgages Reach Record High"

The Fed

The FOMC released the minutes of its January meeting. Bottom line is that QEInfinity is alive and well and maintains its near infinite shelf life. Given the dovish comments from Powell in two earlier and separate speeches, this is hardly a surprise. Here are the minutes along with some commentary.

FOMC Minutes Show Fed Sees "Elevated Asset Valuation Pressures", Will Ignore "Temporary" Inflation Factors

Repo market on verge of a major shock.

Here We Go Again: Zoltan Warns Repo Market On Verge Of Major Shock As Key Funding Rate Turns Negative

Fiscal Policy

The risks of ‘acting big’.

Blain: Why "Acting Big" Still Won't Cure Much In The Real Economy

The coronavirus

A pandemic of ignorance.

A Pandemic of Ignorance

Vaccine math.

Vaccine math. $500 per shot?

Bottom line.

Yesterday, I confessed that I had no idea at what level interest rates would start to negatively impact stock prices. Nomura has a thought:

Nomura: 1.3% Yields Are Fine But If They Hit 1.5%, Stocks Will Be Hammered

This bull is starting to get more circumspect.

The Big Long

Dividend cuts at the Q1 2021 midpoint.

Political Calculations: Dividend Cuts at the Midpoint of 2021-Q1

News on Stocks in Our Portfolios

Hormel Foods (NYSE:HRL): FQ1 GAAP EPS of $0.41 in-line.

Revenue of $2.46B (+3.4% Y/Y) beats by $90M.

Sherwin Williams (NYSE:SHW) declares $1.65/share quarterly dividend, 23.1% increase from prior dividend of $1.34.

What I am reading today

Quote of the day.

Quotation of the Day... - Cafe Hayek

Visit Investing for Survival’s website (Home | Investing for Survival | Investingforsurvival.com) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.

Analyst's Disclosure: I am/we are long hrl, SHW.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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