US Economy thread

[rocky_warrior]

A surprisingly high share of millennials—most of whom are not retired

Written by an AI genius, eh?

Seriously though.  I've rented to a few millennials, and most of them have now purchased homes. I wouldn't be surprised if many of them used the "penalty free" $10k withdraw to help with the purchase.

In fact, I considered that eons ago.  Didn't do it, but wasn't a terrible option at the time.

[Hards Alumni]

F Jamie Dimon.

Agreeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee

[MU Fan in Connecticut]

I deal with LME copper prices everyday.

https://www.cnbc.com/2024/04/10/copper-climbs-to-2024-high-as-wall-street-banks-raise-price-forecasts.html


Copper prices climb to 2024 high as Citi calls the start of the metal’s second bull market this century
PUBLISHED WED, APR 10 20249:06 AM EDT

• Copper prices with May delivery traded at $4.323 per pound in New York as of Wednesday morning, extending gains after settling at its highest level since June 2022 in the previous session.
• Three-month copper prices on the London Metal Exchange traded 0.6% higher at $9,477 per metric ton.
• Demand for copper is widely considered a proxy for economic health.

Soaring copper prices show no signs of slowing down, analysts say, with the red metal’s rally fueled by supply risks and improving demand prospects for energy transition metals.

Copper prices with May delivery traded at $4.323 per pound in New York as of Wednesday morning, extending gains after settling at its highest level since June 2022 in the previous session.

Copper briefly hit a high of $4.334 in intraday trading on Tuesday, reflecting its highest level since the middle of January last year.

Three-month copper prices on the London Metal Exchange traded 0.6% higher at $9,477 per metric ton.

Demand for copper is widely considered a proxy for economic health. The base metal is critically important to the energy transition ecosystem and is integral to manufacturing electric vehicles, power grids and wind turbines.

Wall Street banks are bullish on the outlook for copper prices through to the end of the year.

Earlier this week, analysts at Citi said that they believe the second secular bull market of copper this century is now underway — roughly 20 years after the first such cycle.

Citi said on Monday that it expects copper prices to trend higher over the coming months, averaging $10,000 per metric ton by the end of the year and climbing to $12,000 in 2026, according to the bank’s base-case scenario.

“Explosive price upside is possible over the next 2-3 years too, if a strong cyclical recovery occurs at any time, with prices potentially rising more than 2/3rds to $15k/t+ in this, our bull case scenario,” analysts at Citi said in a research note.

“Our $12k/t base case assumes only a small uptick in cyclical demand growth over the course of 2025 and 2026,” they added.

‘Commodity markets always self-solve’
Separately, analysts at Bank of America have raised their 2024 price target for copper to $9,321, up from its previous forecast of $8,625.

The Wall Street bank said Monday that copper was at the “at the epicentre of the energy transition, which means that the lack of mine supply growth is being felt acutely.”

“Tight concentrates availability is increasingly capping production at China’s smelters and refiners, potentially pushing consumers of refined metal back into international markets,” analysts at Bank of America said in a research note.

“At the same time, demand in the US and Europe should bounce back as economies bottom out; this, along with rising demand from the energy transition, will likely move the copper market into deficit this year,” they added.

Not everyone’s convinced copper prices will hold onto projected gains this year.

“Commodity markets always self-solve,” Colin Hamilton, commodities analyst at BMO Capital Markets, told CNBC’s “Street Signs Europe” on Tuesday.

“They always find ways of softening things out. If we can’t solve from the supply side, well guess what, we’ll hurt demand and that’s what inflation naturally does. That’s why we had underperformance for much of the past year,” Hamilton said.

“So, if copper gets say to let’s say four times the aluminum price, you would tend to see a bit of switching and substitution. I see some very high copper price targets out there: we could reach them temporarily, but then you would see demand adjusting in key areas.”

— CNBC’s Michael Bloom and Lee Ying Shan contributed to this report.

[MU82]

Gas prices have been moving up, contributing significantly to inflation in recent months.

That's tough on everyday Americans, but thank goodness the CEOs of Chevron and ExxonMobil are making tens of millions of dollars.

https://seekingalpha.com/news/4089117-exxon-ceos-2024-pay-bumped-up-3-to-369m-chevron-ceo-pay-rose-12

[rocket surgeon]

Gas prices have been moving up, contributing significantly to inflation in recent months.

That's tough on everyday Americans, but thank goodness the CEOs of Chevron and ExxonMobil are making tens of millions of dollars.

https://seekingalpha.com/news/4089117-exxon-ceos-2024-pay-bumped-up-3-to-369m-chevron-ceo-pay-rose-12

 i know...same to those making snickers bars smaller and those packing fewer potato chips in larger bags too eyn'a?

[Skatastrophy]

i know...same to those making snickers bars smaller and those packing fewer potato chips in larger bags too eyn'a?

Yep. Inflation, price gouging, and shrinkflation will continue until consumers rebel against it. Right now consumers are grumbling, but continuing to buy everything, so the trend continues.

[jesmu84]

Yep. Inflation, price gouging, and shrinkflation will continue until consumers rebel against it. Right now consumers are grumbling, but continuing to buy everything, so the trend continues.

Isn't there a significant difference between organic inflation vs price gouging/shrinkflation?

[Skatastrophy]

Isn't there a significant difference between organic inflation vs price gouging/shrinkflation?

This is still technically cost-push inflation where supply is limited. At the point that supply of homes/oil/etc is high enough, *some* competitor in the market will undercut prices to capture more market share.

There are headwinds, though, in that quite a few industries in the United States have gone through a couple of periods of consolidation through the financial crises that have impacted industry after industry since the pandemic. Black swan event, what are you gonna do?

Because of that consolidation in some industries the weaker competitors (who are most likely to cut prices to increase market share against the big boys) were snapped up. Additionally, debt is really expensive right now so it's not easy to grow a middling competitor in a given market and wait a few years until your cashflow eclipses your spend.

All inflation is organic is a minimally regulated market. Part of the organic Cost-push inflation is realizing that the broader consumer market is willing to pay more for goods because they don't have anywhere else to turn in a market with limited supply of goods. OR shrikflation where you solve the same problem by giving consumers less to recoup your years of tightened profit margins that way. Different solutions to the same problem. Everything costs more so now everything will cost more.

[jesmu84]

This is still technically cost-push inflation where supply is limited. At the point that supply of homes/oil/etc is high enough, *some* competitor in the market will undercut prices to capture more market share.

There are headwinds, though, in that quite a few industries in the United States have gone through a couple of periods of consolidation through the financial crises that have impacted industry after industry since the pandemic. Black swan event, what are you gonna do?

Because of that consolidation in some industries the weaker competitors (who are most likely to cut prices to increase market share against the big boys) were snapped up. Additionally, debt is really expensive right now so it's not easy to grow a middling competitor in a given market and wait a few years until your cashflow eclipses your spend.

All inflation is organic is a minimally regulated market. Part of the organic Cost-push inflation is realizing that the broader consumer market is willing to pay more for goods because they don't have anywhere else to turn in a market with limited supply of goods. OR shrikflation where you solve the same problem by giving consumers less to recoup your years of tightened profit margins that way. Different solutions to the same problem. Everything costs more so now everything will cost more.

Thanks for the thorough explanation.

In my head, "organic" inflation seemed more "neutral" while price gouging or shrinkflation seemed more "evil."

[Skatastrophy]

Thanks for the thorough explanation.

In my head, "organic" inflation seemed more "neutral" while price gouging or shrinkflation seemed more "evil."

Companies growing profits so that they can expand is their raison d'etre. We are stuck with this economic system, employing everyone on the planet so that they have enough money to buy goods and services, until humans invent a better system.

I feel like we really don't know much about how economies work yet. Economists are wrong all of the time about what will happen and what levers to pull. The only thing we really know about capitalism is that broad deflation is the ultimate evil and much be avoided at all costs. Inflation, whether it be fast or slow, is at least enriching some % of the people in the economy as well as 100% of the people holding debt.

The only time that deflation is somewhat desireable is during an economic revolution, where one set of goods is rapidly devalued due to technological innovation while that technology good/service takes the original good's place in the economy. Even that, though, takes 10+ years and absolutely crushes a good part of the people participating in the economy (take a look at how small towns are doing globally).

I'm no expert, though. Just an enthusiast that thinks he's smart.

[MU82]

From the WSJ daily newsletter:

In the latest quarterly survey by The Wall Street Journal, business and academic economists lowered the chances of a recession within the next year to 29% from 39% in the January survey. Economists, in fact, think the economy won't even get close to a recession. It has been two years since forecasters felt this good about the economic outlook.

[rocky_warrior]

https://www.cnbc.com/2024/04/15/retail-sales-jumped-0point7percent-in-march-much-higher-than-expected.html

Rising inflation in March didn’t deter consumers, who continued shopping at a more rapid pace than anticipated, the Commerce Department reported Monday.

Retail sales increased 0.7% for the month, considerably faster than the Dow Jones consensus forecast for a 0.3% rise though below the upwardly revised 0.9% in February, according to Census Bureau data that is adjusted for seasonality but not for inflation.

The consumer price index increased 0.4% in March, the Labor Department reported last week in data that also was higher than the Wall Street outlook. That means consumers more than kept up with the pace of inflation, which ran at a 3.5% annual rate for the month, below the 4% retail sales increase.

[Pakuni]

The US is on track to grow at double the rate of any other G7 country this year, according to IMF forecasts, as the strength of the world’s biggest economy rocks international markets.
Strong household spending and investment will help propel US growth to 2.7 per cent this year according to the fund’s latest World Economic Outlook.
The figure is higher than the 2.5 per cent estimated for 2023 and represents a 0.6 percentage point upgrade on the previous forecast.

https://www.ft.com/content/3b819571-662d-4185-9ca5-c7e682b55700

[Jockey]

Here is the best thing about the great economy:

Crime in Milwaukee dropped significantly in the first quarter of 2024, as violent crime dropped 8% from the same time last year, according to data Milwaukee police shared Tuesday. Homicides were down 39% in the first quarter of 2024, dropping from 38 last year to 23 for the same period this year. Compared to the first quarter of 2022, homicides are down 54%.

Similar stats in most other places. People tend to commit fewer crimes when they are working regularly.

[Pakuni]

Here is the best thing about the great economy:

Crime in Milwaukee dropped significantly in the first quarter of 2024, as violent crime dropped 8% from the same time last year, according to data Milwaukee police shared Tuesday. Homicides were down 39% in the first quarter of 2024, dropping from 38 last year to 23 for the same period this year. Compared to the first quarter of 2022, homicides are down 54%.

Similar stats in most other places. People tend to commit fewer crimes when they are working regularly.

At this rate it may soon be safe for people like me to return downtown.

[Uncle Rico]

At this rate it may soon be safe for people like me to return downtown.

You’ll get shot

[rocket surgeon]

Here is the best thing about the great economy:

Crime in Milwaukee dropped significantly in the first quarter of 2024, as violent crime dropped 8% from the same time last year, according to data Milwaukee police shared Tuesday. Homicides were down 39% in the first quarter of 2024, dropping from 38 last year to 23 for the same period this year. Compared to the first quarter of 2022, homicides are down 54%.

Similar stats in most other places. People tend to commit fewer crimes when they are working regularly.

  I would sure hope so!  they're running out of victims and have to move out to the suburbs where people still have something to steal, more and newer kia's and hyundai's and the population is flourishing.  but criminal at your own risk as those "rednecks" out west might be packing too, eyn'a?

[Uncle Rico]

  I would sure hope so!  they're running out of victims and have to move out to the suburbs where people still have something to steal, more and newer kia's and hyundai's and the population is flourishing.  but criminal at your own risk as those "rednecks" out west might be packing too, eyn'a?

8 out of 10