First of all, thank you to all you readers for an incredible first year of this venture. It has been an absolute pleasure to be part of your Sunday morning reading for the last 12 months. As always, I love hearing your feedback – I’m constantly on the lookout for interesting reads and ideas – email me anytime at uma@unbenchd.com. I will be back in your inbox on January 5th following a short break from the regularly scheduled programming next week. Until then, happy holidays and happy new year to you all, and enjoy this last weekly digest of the decade.  There’s still some hope  Despite last week’s disappointing retail sales report, consumer…

Falling flat  Core consumer price inflation remained unchanged at 2.3% on an annual basis in November (this used to be close to 3% last summer) and wages remained flat as well. Producer prices were equally unexciting in November with the annual rate of inflation remaining unaffected at 1.1% (this was at a seven-year high of 3.4% last summer). Moral of the story: Inflation remains completely tame and if even producers aren’t seeing the inflation despite the tariffs, it’s difficult to see how inflation builds up for the consumer. Inflation would have to meaningfully deteriorate or accelerate for the Fed to become concerned – they left policy unchanged, as expected, at…

Duck  The US manufacturing sector continues to contract as the ISM manufacturing index came in at 48.1 in November, down 20bps from last month. A reading below 50 is indicative of a contractionary environment, and this marks the fourth straight month of contraction. More concerning is the composition of the index as new orders fell to the lowest level since April 2009. The services side of the economy isn’t doing much better as the ISM non-manufacturing index fell again in November to 53.9, which is only slightly in positive territory.  Moral of the story: Honestly, the manufacturing sector is effectively already in a recession right now. The services sector isn’t…

Coming back from the depths  Since the Global Financial Crisis in 2007-2008, the housing market has been clawing itself out of a deep, deep hole given housing was the crux of the issue. But thanks to lower interest rates and an aging generation of “millennials” who need space for their growing families, October marked the third month in a row when the annual pace of single-family home sales was higher than 700k – the last time this happened was 2007.  Moral of the story: We’ve been seeing an increase in homeownership rates recently due to lower interest rates and an increase in home purchases would definitely help boost GDP as we head into 2020,…