Here’s
some more inflation data. Core wholesale inflation was up 0.4% last month,
excluding energy and food. The increase
was due mainly to tobacco. Since most
raw material costs were down in July, it is not likely that we will see follow-through
on the bad numbers next month. The
overall Producer Price Index was only up a more manageable 0.2% in July.
The
worst number yesterday was the Philly Fed manufacturing data and that was my
reason for writing that recession looks much more likely. The Morgan Stanly comment is troubling too.
President
Obama said in his interview with CBS news that the nation was not in danger of
falling into another recession. (Another
recession might put him out of office.)
More importantly, even if he believes the many economists who are
warning of a possible recession, it would not be good for the President to
predict one since it would hurt consumer confidence and make recession even more
likely. As a result, I discount comments
by Politicians.
The Navigate the
Stock Market computer analysis isn’t too important right now. We will need to successfully test the
previous low of (1119) before I’d recommend buying.
The NTSM analysis is HOLD today (based on early data, but it
might be Sell on the final numbers).
I sold on the 27 July sell signal at S&P 500 1301 and I am
defensively positioned with only a small amount of my portfolio invested in
stocks. (Zero stocks in the 401k.)
(See
the page “How to Use the NTSM System” – the link is on the right side of this
page).
I have a 75% short position in the trading portfolio using QID
(2xshort the Nasdaq 100). We could be
near a short term bottom and I will reassess the short position next week.
