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No Trade Deal? (There’s No Inflation Either)

In the wheat pit of the Board of Trade of the city of Chicago 1920

As the latest threats go back and forth between Washington and Beijing, one thing is for certain, there is no trade deal in the immediate future. As CD Media has proffered before, we don’t think China can make a deal that is good for the U.S. economy.

That being said, markets may be pricing in that reality in spite of teasing comments from The White House meant to keep the equity markets in the stratosphere.

And maybe the markets don’t care after all? Maybe they see a new American century dominating a failing China model? We have been looking for a decent correction and still think that would be healthy, but the market is showing no sign of weakening substantially, in spite of negative news.

On the economic data front, PPI came in at 1.4% vs 1.8% consensus estimate YoY for September.

PPI for the MoM in Sept came in at -0.3% vs 0.1% consensus estimate.

The IBD/TIPP Economic Optimism Indicator MoM Oct came in at at 52.6 vs 51.2 consensus.

So, there is no inflation either; it’s a Goldilocks economy! Just in time for 2020!

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