US Economy thread

[Uncle Rico]

Ha! True. All of the good property will be bought up by the Californians by the time I am ready to retire anyway.

https://nbcmontana.com/news/local/study-tracks-californians-moving-to-montana

Tracks.  Bringing the crime with them!  SMDH

[Pakuni]

Yes, I have.. Did it for over 10 years. When I retire, I will probably retire to Montana.  It was a good experience. Sorry you had such a bad experience. Sounds like a you problem. Know-it-alls sometimes get ostracized in rural settings.

Golly. Touched a nerve, I guess.
Anyhow, I had a fine time in small-town America. Made some lifelong friends, got some good life and work experience, and was happy to leave.
Feel bad for those I left behind. Lack of career options. Shuttered factories. Vacant storefronts. Few dining/shopping options within an hour. Young people leaving in droves. Lots of poverty and substance abuse issues.
And the racism. Oh my, the racism. True story ... one town where I lived removed the basketball hoops from their central park because city leaders thought they were attracting too many black people.

[lawdog77]

Golly. Touched a nerve, I guess.
Anyhow, I had a fine time in small-town America. Made some lifelong friends, got some good life and work experience, and was happy to leave.
Feel bad for those I left behind. Lack of career options. Shuttered factories. Vacant storefronts. Few dining/shopping options within an hour. Young people leaving in droves. Lots of poverty and substance abuse issues.
And the racism. Oh my, the racism. True story ... one town where I lived removed the basketball hoops from their central park because city leaders thought they were attracting too many black people.

Nice edit.
Yes, there's no poverty, substance abuse or racism in the urban areas.
You didn't touch a nerve.

[Pakuni]

Nice edit.
Yes, there's no poverty, substance abuse or racism in the urban areas.
You didn't touch a nerve.

Thanks. I chose generosity.
And no, you're not at all touchy about this.

[lawdog77]

Thanks. I chose generosity.
And no, you're not at all touchy about this.

Not the least bit.

[jesmu84]

https://twitter.com/econliberties/status/1790467874374475935?t=P8Zf_KgzOvYugwQ2NGq_TQ&s=19

Ho hum. Another example of private collusion screwing everyday Americans.

[Spotcheck Billy]

that can't be, it's un-American ...oh wait

[lawdog77]

https://twitter.com/econliberties/status/1790467874374475935?t=P8Zf_KgzOvYugwQ2NGq_TQ&s=19

Ho hum. Another example of private collusion screwing everyday Americans.

I don't have access to this article but I would be curious to know how they are going to spin this.
https://www.wsj.com/finance/commodities-futures/ftc-oil-prices-market-collusion-aa7f2de9
Title:What’s So Bad About Fixing Oil Prices?
A U.S. oil CEO’s alleged collusion with OPEC isn’t as alarming or evil as it seems

[jesmu84]

https://finance.yahoo.com/news/5-years-ago-renters-needed-182321562.html

5 years ago renters needed to make less than $60,000 a year to afford the typical rent; now they need to make almost $80,000

Average US salary (based on Google results): $64,000

[Skatastrophy]

In six months do you all believe that inflation will be flat, up, or down?

I'm expecting flat, but I figured I'd ask the experts.

[ATL MU Warrior]

In six months do you all believe that inflation will be flat, up, or down?

I'm expecting flat, but I figured I'd ask the experts.

I’m expecting up, maybe not across the board, but led by fuel costs.  That industry will do whatever they can to influence the election towards Rs and $4+ a gallon gas will go a long way towards that goal.   

[MU82]

No expert here. I'd guess flattish just because it makes sense to me that it will go neither up nor down much.

There was a new CPI report today, showing a very slight cooling to 3.4% in April. It's been in that range month after month, give or take a .1%, for awhile now, and I see no reason why there would be a greater variation, up or down, for the next 6 months. FWIW, crude oil is down about 1% today as I write this, but that's very volatile and who knows where it will go.

So I'm expressing no "confidence" either way, just trying to be pragmatic.

[Goose]

FWIW, one of our larger clients who is someone I track closely for our biz, and the general economy, just requested canceling or pushing out delivery on orders scheduled to arrive the USA in Aug-October. They supply parts to the big AG guys and auto industry, and they normally extremely sharp on their forecasting.  We have worked with this client since 2005 and this is the third time we have seen this type of request. The first time was in spring of 2008 and second time during the pandemic.

For the record, I am not saying this is doomsday on the economy by any stretch. Thought it was interesting because in the 19 years of working them only two times have suppliers not shipped them goods in a given month. Prior to these cancelations they have good shipped twelve months a year 16 out of the last 18 years. Will add, the request was made due to slowdowns with their customers.

[tower912]

Bet on oil to spike.

[Lennys Tap]

Bet on oil to spike.

Could happen.

[Sir Lawrence]

Not the least bit.

I thought this was all covered when we discussed Jason Aldean's 'Try That in a Small Town' song.

[Herman Cain]

FWIW, one of our larger clients who is someone I track closely for our biz, and the general economy, just requested canceling or pushing out delivery on orders scheduled to arrive the USA in Aug-October. They supply parts to the big AG guys and auto industry, and they normally extremely sharp on their forecasting.  We have worked with this client since 2005 and this is the third time we have seen this type of request. The first time was in spring of 2008 and second time during the pandemic.

For the record, I am not saying this is doomsday on the economy by any stretch. Thought it was interesting because in the 19 years of working them only two times have suppliers not shipped them goods in a given month. Prior to these cancelations they have good shipped twelve months a year 16 out of the last 18 years. Will add, the request was made due to slowdowns with their customers.

Goose:
A company I am on the Board of has experienced similar pushing out of delivery for orders.

I have been on the Board for many years  and  similar to your experience , we saw this same customer behavior in Great Recession and  Pandemic.

An observation from this company is that much of the recent growth has come from customers getting their inventory in balance . Now that it is in balance and decent depth. Now that the customers can properly meet their needs , reorders are reflecting true underlying economic conditions.

[Frenns Liquor Depot]

There are multiple industries are producing well below actual demand right now because of too much inventory in the system that built up post pandemic and when the supply chain lengthened/were disrupted. Depending on your industry this has been happening since early 22 and has been very long. 

Additionally gdp has been solely led by services for quite a while because of above dynamic and spending shifts back to trips, experiences etc. 

So not a new phenomenon even if some new parts of the economy may be starting to see it now. 

[GOO]

If there is negative news coming, as of now I think it is good for the markets. When does negative news become bad news?  I don’t know. The markets want to see unemployment above 4%. That is good news for the markets and for now would be bullish.  The fed won’t get what it wants without breaking the employment market., that’s been my opinion for a while.

Another perspective to consider is from someone in industrial real estate in Dallas and Atlanta. Investor, owner,  developer.  He says the amount of manufacturing capacity and industrial building going on is something he has never seen except to compare it to how China used to be. Literally comparing it to a China boom scenario.  From his perspective and his periscope view into the economy things are booming like he has never seen.  But things can be booming and falling apart at the same time, especially in real estate which often is mistimed, as we know. But it also is a buffer against a big down turn unless financing falls apart like in 2008-9 where projects literally got abandoned that were in process. That seems like less of a risk now; but what we don’t think is a risk can be.  When things are going well there might be more risk, we just are not seeing it. When things are going bad we might see all sorts of risks, when there actually is less risk especially long term. Buffet’s way of investing. He understood some version of negativity bias before anyone even if it didn’t have a name.

I don’t pay much attention to predictors, no one can predict consistently so as we know Buffet is the model to stay long and invest more when things are really ugly, but I like to get Prof Jeremy Siegels perspective. Last I heard Siegel thinks we could be in a bull run for the  rest of the decade due to factors including AI. I think if one invested like Buffet but used index funds, and on the margins followed Prof Siegels signals,  for marginal adjustments, one could have some fun and try to beat the index funds (fools goal I know and I just keep putting dumb money in and ignore it).

Either way, I just keep investing the same as always. I consciously don’t check in too often (negativity bias demands that we don’t check in too often or change our plans or we will underperform and over react to down turns). I learned my lesson in the Great Recession.  I saw it coming, saw the real estate bubble. Got a lot out of the market. Great move. Except that I was too slow getting back in. I learned not to try to time things, because as I know now one has to get it right twice. And that is simply foolish for me to think I can do that not once but twice.

Because of our bias’s I’ve decided  to expect to get slaughtered once in a while and see 40 or 50 percent losses, but don’t let it affect the long term strategy. And anything you don’t need to use in the short term should be invested for the long term. Maybe I’m lucky, as I consider most of what I have invested in the market for future generations, so 80% plus is long term. And if  I greatly outlive life expectancy than I should have invested for the long term anyway.  And I’m one of those that doesn’t hope to live to 100 or God help me longer. Never outlive all of your friends and some of your children - just too sad and painful.