thinking about cpi

Discussion in 'Trading' started by dtrader98, Apr 16, 2007.

  1. ok, here's a recap for the cpi and last interpretation by market. Futures were down
    S&P -4.9
    NAS -8.25
    DIW -4.1
    Nas dropped lower, then had the typical miracle rebound later in the day. This held for a few days... to new high... then the big surprise drop. It could have also been due to japan raising interest rates during the same time. Not significantly bad.. yet, not good for yen trade carry followers.

    Economists appear to have already ratcheted expectations up to make actual numbers much better in comparison. A survey of economists (according to marketwatch) shows expectations way up on CPI to 0.7% jump, while core CPI still sits at 0.2% expectation. With gas soaring again, it seems reasonable to expect the non-core aggregate to rise. Rents don't seem to be going down as housing drops-- another potential source of fuel to the upside.

    Market seems to interpret CPI much more harshly than PPI, as FED seems to look at that number more closely.
    Markets seem frothy at this point, with short squeezes being the often mentioned catalyst for the recent surges. At some point that should abate, the question is when. Tomorrow may give some insights, but don't expect any immediate reaction unless it's inline, in which case, market will skyrocket of course. That's just my opinion.

    "Patterns are the fool's gold of financial markets... They are the inevitable consequence of the human need to find patterns in the patternless." Mandelbrot
  2. john12


    you're posting nonsense and stupid things. the market could give 2 shits about the cpi,ppi,housing are earnings. all it gives a damm about is running in the face of everything. if this were a fair and balanced market it would have sold off 10-15% from jan-march to reflect the huge drop in earnings est's. instead its at highs and when company's beat these watered to hell est's they run even higher.were in a special time in history were liquidity and greed rule so your nonsense cpi means squat
  3. If you had a half a mind to use a little logic, you'd see that my perception is not that far from your own. One of my points in showing this is that the market participants don't seem to care if the CPI/PPI etc.. are bad, and that they are not driving it inline with the way you would logically expect. Raising the CPI estimates is the equivalent of quietly lowering the S&P estimates -- no one cares to report about it and the markets ignore it, until the actual results come out, at which time they can say, "gee, the results were not as bad as we expected, let's rally some more."

    Anyways, I won't waste anymore time posting this drivel, as it doesn't seem to make sense to anyone. Peace.
  4. john12


    right now nothing makes sense. this is a different time than any in at least 25-30 years. as you said all that matters is beating the est and not the real #. we all know inflation going wild yet when the inflation # or earnings # is " better than expected" we sky. this game will end in shambles as they always do
  5. inflation below 3% officially, right? nobody should worry about that. worrry when it hits 5%.
  6. S2007S


    they continue to talk about inflation being in line etc....

    Inflation is not in check, prices are going up across the board.

    I dont think the consumer cares, they continue to spend at a record pace no matter what the economy is doing.