The DC Today - Tuesday, May 16, 2023

The Dividend Cafe

The Dividend Cafe - The Bahnsen Group

Monetary Policy, Investing, Wealth Management, Business, Retirement Planning, Macro Economics, Dividend Growth Investing, Estate Planning

4.9 • 572 Ratings

🗓️ 16 May 2023

⏱️ 11 minutes

🔗️ Recording | iTunes | RSS

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Summary

Today's Post - https://bahnsen.co/3IgucD9

All eyes were on the White House today as debt ceiling talks continued. The report after talks ended today that “no deal has yet been reached” was, ummm, not a story. I remain skeptical that a real deal gets done before there is a real deadline and moment of hysteria, but I do still believe these talks set the foundation for what that eventual deal will, in fact, be. The word that the White House is willing to accept discretionary spending caps, clawing back unspent COVID dollars, and work requirements for some social safety net programs, if true, does seem to me to mean a deal will likely, in the end, get done. But there is a lot of wood to chop, as the great Rene Aninao likes to say.

As for all that recession talk, estimates are still for a slightly up quarter in terms of real GDP growth for Q2, but with Q3 and Q4 being the likely entry period for GDP contraction.

Chapter 11 bankruptcies were up +43% in Q1 versus Q1 of last year. Now, bankruptcies a year ago were down -32% from the year prior, so there was clearly a low base effect going on. But overall, I do believe we are seeing increasing problems surface in small businesses where access to funding is becoming an issue.

With all the talk about the U.S. dollar year-to-date, I thought it worth pointing out that while the Euro is up a whopping +1.8% YTD to the dollar on the year, and the sterling pound is up +4% to the dollar, the U.S. dollar is actually up versus Chinese renminbi, Yen, South Korean Won, South African Rand, and Australian dollar. In other words, people have no idea what they are talking about.

Links mentioned in this episode: TheDCToday.com DividendCafe.com TheBahnsenGroup.com

Transcript

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0:00.0	Welcome to the DC Today, your daily market synopsis of the Dividing Cafe, brought to you every Monday through Thursday to bring you up-to-date information and perspective on financial markets.
0:14.6	Hello and welcome to the Tuesday edition of DC Today, a little bit ugly of a day in the markets, Dow down about 1%,
0:22.6	S&P down about 0.6, NASDAQ down about 0.2. No real particular news. We weren't expecting any
0:31.6	kind of a debt ceiling deal. And in fact, the meeting there wasn't even starting until near the end of the market day
0:39.1	and the market had been down all day.
0:42.8	A Home Depot did release earnings this morning and had quite a few negative things to say
0:48.1	about some of the economic landscape.
0:50.9	So there's always different things that could potentially play into a day like this.
0:55.4	But I think that this is something I want to continue to reiterate.
0:59.8	This is what you expect right now.
1:02.2	You have uncertainty around Fed and recession.
1:05.1	Not a lot of particular new uncertainty in the banking sector, but not any resolution per se either on the regional
1:13.2	banking side. And then I think just the headline issues around what will surely be a more
1:20.8	drawn-out affair than maybe people realize with this stupid debt ceiling negotiation stuff.
1:26.7	I think you can expect some elevated volatility for a little while.
1:30.3	That's the main thing I'd say, by the way,
1:32.2	as I am watching the way I expect a deal to come together with Speaker McCarthy in the White House,
1:37.6	I'd still, I've been pretty much in the camp for the beginning that they're going to end up getting a deal.
1:43.7	And they will put us through a whole lot drama along the way.
1:47.6	And by us and they, I don't mean that they as necessarily the politico's involved,
1:53.1	but I think the media is really enjoying this moment.
1:57.3	I do think that, by the way.
	...

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