A Musical Interlude -- February 25, 2024

Locator: 46905LR. 

And I'm done for now.

Link here.

And,

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What If?

Link here.

Form the linked article -- it's been two years since the Fed starting raising rates. Holy mackerel. Two years and the economy seems stronger than ever.

Not so fast, Goldilocks.

The past few months have seen the soft-landing hypothesis surge from behind and overtake recession as the consensus economic outlook.

Inflation has receded in the face of the Federal Reserve’s massive assault on interest rates.

Yet, paradoxically, employment has remained robust, with lots of new jobs created and layoffs near cyclical lows. Corporate earnings have been reasonably strong.

I know what the Goldilocks deniers are saying right now: Rate hikes don’t work overnight. They take time to stifle the economy. But it has been 700 nights and counting since the first increase, in March 2022. So, maybe Goldilocks deserves to take a bow (a victory porridge?) as the soft landing seems to be all around us, with recession in the rearview mirror.

That said, there’s another alternative, one that is definitely not consensus but seems to be accumulating more and more evidence in its favor. What if the economy—already defying economic theory by surviving in the face of sharply higher rates—is actually getting stronger?

That’s admittedly an odd thing to posit after two years of interest rate hikes. But as crazy as it sounds, evidence is starting to pile up for the acceleration hypothesis.

First, there are the “big” data points, like unemployment and the stock market. The change in nonfarm payrolls in December’s report was the strongest since September. January’s was even stronger.

The stock market, widely seen as a mechanism that discounts future growth, is up over 20% from late October to mid-February.

And much more at the link.

I call this the "touch and go" scenario and have called it that for at least a year.

I agree with Harold Hamm. No time for negative talk. It's "damn the torpedoes and full speed ahead." LOL. Speaking of which, I think Harold Hamm has passed the baton to Chord (Oasis,Whiting, and now Enerplus).

I better put in the disclaimer. 

Disclaimer: this is not an investment site. Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

All my posts are done quickly: there will be content and typographical errors. If anything on any of my posts is important to you, go to the source. If/when I find typographical / content errors, I will correct them. 

Again, all my posts are done quickly. There will be typographical and content errors in all my posts. If any of my posts are important to you, go to the source.

Reminder: I am inappropriately exuberant about the US economy and the US market. 

And then this:

Goldman Sachs is upbeat about the economy this year. Its economists see healthy growth of 2.3%, unemployment staying below 4%, and the probability of recession at just 15%—all more optimistic than the consensus. And they see inflation, excluding food and energy, continuing to fall, to a little over 2% (using the Federal Reserve’s preferred measure) by year-end.

Forecasts are a dime a dozen. Why care about Goldman’s? First, because its economists have been firmly in the soft-landing camp, which now looks prescient.

Second, Jan Hatzius, the firm’s chief economist, made an equally out-of-consensus, and prescient, call in the opposite direction in 2008. Back then, he correctly warned that mortgage defaults could cause a severe recession.

Nailing one big call might be luck; nailing two gets you a following. Hatzius is one of the most closely followed economists on Wall Street and in Washington.

I'm going to need another song.

Link here.

And now for my book for the weekend: link here.

Chapter Seven: Imperial Overstretch? King Æthelstan and the Conquest of the North

• King of Anglo-Saxons, 924 - 927; 
• King of all English, 927 - 939
• the influence of the Scandinavians, Danelaw, language, etc, critical p. 253.
• the question of how many Scandinavians had settled in these areas cannot be answered decisively, but .... 

Across large areas of northern and eastern England, we find many place names that end with either -by or -thorpe, both of which are elements imported form Old Norse

It was at this point, for example, that the monastery founded by St Hild at Streaneshalch became known as Whitby, and the settlement that had been Northworthig was renamed Derby.

Almost half the place names in Yorkshire recorded in the Domesday Survey of 1086 had such Scandinavian origins. 

In addition, thousands of Norse loan-words appear in English sources written after the late ninth century. One notable grammatically borrowing was the words they, their, and them. 

I'll leave this world loving you.

The Beatles, The Rolling Stones, Taylor Swift -- and so many more -- titans, but even a single song by a single artist can make my day. I'm thinking of Vern Gosdin.