The Fed’s thoughts  Meeting minutes from the latest FOMC meeting indicated a more positive outlook of the economy in October than the prior meeting. However, officials voted with an overwhelming majority (8 to 2) to cut rates for the third straight meeting as the committee felt uncertainties associated with trade tensions and geopolitical risks had eased but still remained elevated. Officials also discussed tools to use in the next recession and unanimously opposed pushing rates into negative territory (ICYMI, there are countries in Europe where you literally get paid to take out a mortgage to buy a house because interest rates are **that** negative).  Moral of the story: There was widespread support to move to…

Deck the Wal’s…  Retail sales rebounded in October after a rut in numbers recently but the headline strength was driven by auto and gasoline sales. Excluding those, retail sales only rose 0.1% this month as most retailers experienced (hopefully) just a calm before the holiday season shopping storm. Online retailers, however, continued to see positive results. Moral of the story: Consumer surveys are pointing to the possibility of a strong holiday shopping season but the decrease in spending reported in September combined with the lackluster increase in October makes me feel meh. However, Walmart’s earnings release this week was quite strong and management increased full-year outlook ahead of the holiday…

Why is the services sector slowing? The manufacturing sector in this country has seen better days and continues to contract, but the services side of the economy, which is a much larger part of our economy today, rebounded in October after hitting a three-year low in September. The index saw improvements for new orders as well as employment, which increased 3.3 points from a five-year low in September.  Moral of the story: Services sectors have been more insulated from the negative impacts of the trade war with China compared to manufacturing sectors but have still been impacted by the slowdown. The ISM non-manufacturing index six points lower than its cycle…

The Almond Joy  The first read on third quarter GDP showed the economy grew at an annual pace of 1.9%. While its lower than what we saw last quarter, things could have definitely been much worse. Consumers continued to do their part to keep this record long economic expansion going as consumption, which accounts for 70% of the economy, increased 2.9%. Businesses, on the other hand, slowed as spending on equipment fell 3.8% and investment in structures fell more than 15%, which is the steepest decline in almost four years. Moral of the story: While businesses have become increasingly cautious, consumers seem to have to have acclimated to the economic uncertainties presented by a…