US consumer sentiment slumps, households brace for inflation surge

so...you must also then, by your own logic, accept the hard data that showed the state of the economy when Trump took over. OR will you succumb to the " repeat things often enough and humans will begin to believe it" which is clearly the modus operandi of trump.

He is declaring his sentiment, as if it was hard data , the very thing he argues against. The stock markert is not the economy, and is now more than ever driven by sentiment rather than actual value and returns.

People need to do their own research so they will see that the US consumer sentiment report is like a political poll...slanted toward whiny liberals and the "declining" sentiment is brain washed into people's minds by the deep state media...repeat things often enough and humans will begin to believe it. Hard data shows the opposite of faked soft data.

Oh, are you referring to the non-farm payroll jobs reports that the previous administration lied about and was forced to correct to the DOWNSIDE by over 1 million jobs? Thank you for reminding me of this so I could share it with everyone.

lol and why does your opinion hold any weight? Do you work for a broker, bank or any of these things? What do you know about the economy?

Re: Economic data this morning

My Comments:

1. The biggest news is that the Import Prices month to month have increased by only 0.1%, which is 1.2% annualized. We must ask "where is the inflation?"

This is after the media raised the alarm that Trump's tariffs will, no, MUST increase the prices.
And since the prices have been declining lately, the media, devoid of any knowledge of economics but uniformly unfriendly to president Trump, have changed the tune and started publishing articles with titles such as "Prices have declined but do not expect it to last" and "Make your purchases now because by Christmas the prices will be high."

The example that explains everything about Trump's tariffs is as follows:
When BMW (cheaper in New York than in Munich where it is made - been there, seen that) was imported into the US with the tariff of 2.5% for decades whereas Chevrolet - no luxury car - was imported into Germany with the tariff of 10% and 20% VAT, there was something wrong. Trump changed that. What was wrong was the fact that such trading policy benefited foreign manufacturers and foreign labor at the expense of the American manufacturers,American labor and American national economy.

Such trading policy can be justified only if you subscribe to what a European visitor told me here without a hint of irony: "Americans have more money so they can pay!"

In addition, Trump wants to use income from tariffs to lower the income tax rates and to eliminate certain income taxes entirely, thus benefiting Americans.

Lastly, Trump's tariffs are designed to reduce the unsustainable negative balance of payments we have with major industrialized countries ($400 billion with China alone) by reducing the dollar amount of imports and replacing part of them with domestic production. The bumper sticker on a BMW that read "Real Americans buy what they like" still remains true though.

That is all. One does not have to be a MAGA enthusiast to see this economic picture clearly.

2. The second major positive news is that the Housing Starts month to month have increased from 1.34 million to 1.36 million.

This is somehow overshadowed by the Building Permits that declined from 1.48 million to 1.41 million month to month though the number of Building Permits exceeded the Housing Starts by 3.7%.

3. The Preliminary University of Michigan Consumer Sentiment declined from 52.2 to 50.8 since the previous month. UoM is asking 420 consumers how they "feel" about the general economic conditions. The decline in Consumer Sentiment cannot be caused by the inflation and the prices because the inflation and the prices have declined dramatically. The reason must be the general uncertainty about the effect of president Trump's tariffs that has been portrayed uniformly by the media as negative. I say that this negativity is based more on political proclivities than on any bona fide economic reasons or knowledge.

4. The Preliminary University of Michigan Inflation expectations have increased to 7.3% from 6.5% last month. UoM researchers are asking the same 420 consumers WHAT THEY THINK INFLATION WILL BE IN 12 MONTHS.

I say, based on my experience and knowledge, that these 420 consumers have no basis for telling us what the rate of inflation will be in 12 months. But there is a value in this opinion: This has been long recognized in the economic theory as a possible self-fulfilling prophecy. Namely, when consumers feel the inflation will be increasing, they may require the increase in pay in excess of the actual rate of inflation. Such increase then becomes inflationary in itself.

IO

What are you guys arguing about? The markets saw the longest and strongest bullish run in over two decades and are almost at ATH again. All the data that has been released in the past three months has been pretty good considering an overhaul of Americas long over due trade deals and downsizing the government. The data looks good. The markets look good. The propaganda from news outlet does not look good. You guys trade the news, I'll trade the price.

The last administration left the books in the oven.