• The positive narratives are back!

• The market believes in Google even as it might doubt Nvidia

• The balance of the Fed has shifted

• Yeah (snort), it’s about the money

• Volatility is back, large Outlier moves are not

• Employment not as bad as feared

• Business surveys are mixed

• Existing Homes are now more expensive than New Homes

• Retail Sales slip heading into the holidays

• Quick Hits

• Where did all the crypto money go?

• Chart Crime of the week

• Happy Thanksgiving!

The bullish narratives were back in focus this week.  All of a sudden, the Federal Reserve is going to cut interest rates in two weeks.  Some macro data has weakened, but the economy is still growing at an accelerating pace with modest inflation.  The Artificial Intelligence trade is still bifurcated, but some winners are emerging.  And there might actually be peace in (the) Ukraine (we do not believe this for one second, but apparently the market does).

The market for predicting the outcome of the next Federal Reserve’s Open Market Committee has swung wildly back in favor of a cut.  The probability has gone from 94% a month ago to 30% last week to 85% now.  Backwards-looking economic data has softened somewhat.  But we think the market is acknowledging that the economy has some weak spots but is generally on a good trajectory.  The Atlanta Fed has 3Q GDP growing 3.9% (sequential quarter vs quarter, annualized).  Goldman Sachs is just a bit below this at 3.7%.  As we always note, the best market environment is when the economy is growing and the Fed is cutting rates.  Strong Walmart earnings are another sign of a good economy (even though lower-end consumer spending has slowed, higher income consumers are increasing their shopping at WMT).