GDP Is Growing Again, Rents Are Falling, Investors Are Eschewing Stock in Favor of Bonds
October 28, 2022 | FIRESIDE CHARTS
U.S. GDP is growing again, but the story is a little more complicated below the surface. Preliminary data is showing a decline in U.S. rents during October. The Federal Reserve has now overseen the largest 6-month decline in the M2 Money Supply in at least the past 60 years. Investors are piling into bonds and continue to eschew equities, despite some positive developments in the latter.
1. The difficult housing market is taking a toll on GDP growth, while the export and inventory components that drove GDP declines in the first and second quarters provided a net positive contribution:
Source: Daily Shot 10/28/2022
2. Consumer spending growth has slowed down but is still positive:
Source: Daily Shot 10/28/2022
3. While real time data is showing weak rental and housing markets, lagging CPI data is likely to show continued housing inflation in the coming months:
Source: Bloomberg Read full article
4. A growing money supply is generally considered to be an inflationary force, the opposite is also true
Source: Daily Shot 10/27/2022
5. Continued mark-to-market losses aren’t scaring away investors as bonds now offer an attractive rate of return:
Source: BofA Global Research
6. Equity positioning remains bearish:
Source: Deutsche Bank Research
7. The market is going up more on positive days and down less on negative days:
Source: @markets, @lena_popina Read full article
8. Small-cap stocks are leading the market as large-cap growth lags:
Source: @allstarcharts
Disclosure: The charts and infographics contained in this blog are typically based on data obtained from 3rd parties and are believed to be accurate. The commentary included is the opinion of the author and subject to change at any time. Any reference to specific securities or investments are for illustrative purposes only and are not intended as investment advice nor are they a recommendation to take any action. Individual securities mentioned may be held in client accounts. Past performance is no guarantee of future results.