The BEA released their October core inflation report today and it has some really useful information.
Let’s take a look at some of the charts.
The Fed’s preferred measure of inflation seems to be coming down but does this mean that a rate cut is coming and consumption will pick up again?
Speaking of consumption, what and where are people buying and not buying?
The big spend is in health care, housing & utilities, and other services. The big losers are everything auto related and insurance/financial services.
If inflation continues to go down then we would expect consumption to pick up at some point and that will be exacerbated if the Fed cuts rates. Housing is still too expensive and we can’t make the numbers work for any real estate rental properties so we’ve been sitting in cash earning 5.5% in 30 day T-bills.
We will continue to sit and wait and if you don’t see many posts on this site it’s because the best thing to do is just T-bill & chill.