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Retail Sales Report Prep

The big economic number of the week is the Retail Sales numbers coming out Friday from the U.S. Census Bureau. For those that are interested to look at more details on the numbers you can go to Census Bureau . The upcoming numbers are for the month of November. The market is expecting an increase of 0.6% month over month (from Oct to Nov). The prior month saw an increase of 1.4% (from Sep to Oct)

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Housing Permits a Leading Indicator? Revisited

A few months ago I dove into some research on the Housing Permits and how they are as a leading indicator since CNBC and gang will base an entire economic recovery call on them. I wanted to see the real relation of the markets moves and this data.

CNBC video showing how they are deceiving.

Report contains: (1) a historical comparison to the mid 1970’s recovery in relation to Housing Permits. (2) Does housing permits predict market tops and/or bottoms? (3) Going forward a view that isn’t talked about, where housing permits reverse and break their lows.

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Fed Rate Decision and Inflation

Today the Federal Reserve spoke and the results were what everyone expected, which was the Fed was going to stand pat and keep their current policies in place.

The most important part of any Fed Rate decision is the markets reaction; and although the decision was an expected result the market responded pretty dramatically in a negative fashion. The Dow, which was up around 100 points throughout the morning, finished down 23 points. And also of note is that the decline was on high volume.

The following are some charts of interest.

* First is a chart from dshort.com that shows the history of inflation from the Bureau of Labor Statistics through the CPI.. to show some of what the Fed is looking at for inflation information to base their decisions on.
* Second is a chart showing the S&P 500 reaction today to the decision.

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