Gross domestic product data showed the U.S. economy grew at a rate of 3.3% in the fourth quarter
That’s much higher than the 2% expectation from economists polled by Dow Jones, underscoring continued economic resiliency despite interest rate hikes from the Federal Reserve. The result, for better or worse, speak for themselves: while Q4 GDP rose by $329 billion to $27.939 trillion, a respectable if made up number, what is much more disturbing is that over the same time period, the US budget deficit rose by more than 50%, or $510 billion. And the cherry on top: the increase in public US debt in the same three month period was a stunning $834 billion, or 154% more than the increase in GDP. In other words, it now takes $1.55 in budget deficit to generate $1 of growth... and it takes over $2.50 in new debt to generate $1 of GDP growth! Source; www.zerohedge.com
The Buffett Indicator (total value of all publicly-traded stocks/GDP) is near all-time highs and at a significantly higher level than during the Dot Com Bubble and the Global Financial Crisis.
Source: Macro Micro, Charlie Bilello
The US Money Supply decreased by 2% in 2023, the largest annual decline on record with data going back to 1959
This was the second straight annual decline which followed the record 40% expansion in the money supply in 2020-21. Source: Charlie Bilello
US earnings: things get fun starting this week
Source: The Transcript, Brad Freeman / StockMarketNerd
US presidential election update:
DeSantis drops out of Republican race
Trump's odds of winning the election are now at the highest, and 3 ppts above Biden.
As Goldman notes, on balance, a Republican 'sweep' looks likely to increase the chances of a stronger USD, higher breakeven inflation rates, higher yields, and a steeper yield curve. It may also increase the tails in both directions for energy prices. Source: Predictit, www.zerohedge.com, Bloomberg
U.S. Banks are facing unrealized losses of roughly $685 billion. They are desperately hoping the Federal Reserve will cut rates sooner rather than later.
Source: Barchart, FDIC
IOWA REPUBLICAN CAUCUS: TRUMP MADE HISTORY BY WINNING ALL 99 COUNTIES AND WINNING BY THE LARGEST MARGIN EVER.
The Iowa caucus on January 15 launches the long designation process of the Republican and Democrat candidates to the US presidential election. On that day, only Republicans will vote (Democrats will hold their own later in 2024). While Iowa is a small state, and not very representative of the country’s population (90% of Iowa’s population is white and in past elections, the Iowa caucuses have rarely predicted what will happen in other primaries), it is seen as very important for candidates to gather positive momentum for the remaining of the campaign and the following state caucus and primaries. In the current context, the Iowa caucus may already provide a hint on whether any challenger to Trump within the Republican party has the potential to compete with the former President, or not. Rival campaigns and many political pundits had argued that if Trump failed to top 50% of the vote, he wouldn't meet expectations.
