Inflation data was perceived as tame yesterday so that means rate cuts and easy money for as far as the eye can see. America's wealthy class dances with glee knowing they can rape the country for more easy and effortless stock market gains. Too bad that one-half of the country does not own a single share of stock. As long as inflation remains in check, the rate cuts are perceived to help the economy and jobs. If, however, inflation begins running higher, the rate cuts will only serve to fuel more inflation. You remember the Bidenflation during the COVID-19 pandemic and you do not want a repeat with the Trumpflation.
King Donnie was elected in November 2024 at GTX 3500. The orange head was officially sworn-in to office in January of this year at GTX 3850 and was awarded a paper Burger King hat. No one noticed that GTX jumped +4% last week and now teases towards 4K. Common Americans are not surprised since they see the outrageous prices at the supermarket. Folks gather around the meat department commenting on high prices opining about the past when they could cook a steak dinner at home. Keystone told the girls at the market they should start selling lettuce by the leaf since a head is now 3 bucks.
Where's King Donnie? He is focused on international affairs bragging that he stopped wars as the Middle East remains a mess and the orange one now threatens war against Venezuela. Note to Donnie; if you want your little peace medal, it is not a good idea to declare war on a country and start bombing it.
Trump needs to refocus on the economy to show he at least cares. Spewing garbage from the press room podium that prices have gone down is a lie. And why is the Whitehouse Spokeswoman Karoline Leavitt always yelling when she talks? Oh my. How would you like to be married to that getting yelled at all day long? No thank you. At least she is better than the incompetent Karine Jean-Pierre chick that lied for Biden that has three first names.
GTX consists of energy, ag (you say ag instead of agriculture to sound cool like you know what you are talking about), industrial and precious metals, and livestock. Precious. This basket includes crude oil, natty gas (you say natty instead of natural gas to sound cool like you know what you are talking about), heating oil, wheat, corn, soybeans, cotton, coffee, sugar, aluminum, copper, nickel, zinc, gold, silver, cattle and lean hogs.
Energy is the largest weighting for GTX and note that XLE popped +3% last week. Brent Oil pops +7% and West Texas Intermediate gains +4% so GTX runs higher on the energy enthusiasm.
When King Donnie was elected and took office, inflation was on the rise and in people's faces. To Trumpski's good luck, as the chart shows, GTX, a representation of goods inflation, drops during the stock market crash in late February, March, and early April. This allows Donnie to brag that inflation has come down and he tells everyone he is a hero. But goods inflation runs higher again and the press secretary would be best advised to stop painting a rosy picture on prices because all of America knows it is a lie.
Note how the chart is in a sideways funk for the last few months. This enables both inflation cheerleaders and detractors to have an equal say since price has not committed to a direction yet. The move higher in GTX should create fear because the rate cuts will fuel the Trumpflation. GTX represents goods inflation but services inflation will also be impacted since goods are typically involved in the services you receive. If a severe recession occurs going forward, inflation will drop sharply, and the rate cuts will be the correct path ahead, but many people will be kicked to the curb and left jobless.
Sleepy Joe Biden, the dementia and Alzheimer's patient that was president for the prior four years, fell from favor and had a low approval rating because of the crazy inflation he created with his war on the energy complex in favor of the glorified golf carts (EV's), windmills that kill birds and eagles, and solar cells that do not work on a cloudy day. Have You Ever Seen the Rain? Donnie needs to be careful he does not repeat the Biden mistake.
The tariffs are starting to kick-in to consumer prices that are rising which will hurt retail sales going forward. Biden's goose was cooked by his misguided climate change agenda and war on America's energy complex and Trump may suffer the same fate due to his daily misguided and confusing tariff drama and other escapades.
It will get ugly going forward if GTX pops above 4K running higher because the Fed will be cutting rates at the same time throwing gasoline on the inflation fire potentially creating rampant out of control Trumpflation. Time will tell.
It is guaranteed that Federal Reserve Chairman Powell probably did not sleep well last night. Neither did King Donnie because he is holding on to the fig leaf of lower oil prices but he will be completely exposed if the oil prices begin running higher. If oil prices rise, retail sales drop. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
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