A roundup of what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web
Citi global macro strategist Jeremy Hale reacted strongly to Thursday’s disappointing update in the U.S. leading economic indicators index,
“The leading indicator rarely ‘just stabilises’ (as Citi economists’ growth forecasts imply), it either turns higher or continues to move lower, with zero (YoY %) being the key inflection point, close to where the indicator currently hovers. Only on one occasion has the indicator crossed below zero and the economy not entered into a recession within 18 months (1995). Well now it’s either the 2nd occasion or we are heading to a recession. Conference Board LI fell 0.3% mom and the seasonally adjusted index for December was 126.5 vs 126.6 for December 2018. It’s not massive, but it’s a negative yoy print”
“@SBarlow_ROB C: --> “ - (research excerpt) Twitter
“@SBarlow_ROB Citi's Hale worried about U.S. LEI in YoY terms” – (chart) Twitter
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“@SBarlow_ROB BMO on U.S LEI : "this reliable recession gauge is worth watching in coming months as it indicates a loss of economic momentum that could prove troublesome in the face of possible new shocks, like the coronavirus" – (research excerpt) BMO
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Proctor and Gamble Co. set some kind of record for an earnings report that best highlights demographic change.
A declining U.S. birthrate resulted in reduced revenue for baby diapers, but the company reported a 35-per-cent year-over-year increase in adult incontinence products.
“@SaraEisen On the flip side to baby diaper slowdown, P&G reported adult incontinence biz grew 35% last quarter $pg ‘ – Twitter
“P&G sales growth shy of forecasts as slowing birthrate hurts diaper sales” – Reuters
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Dripping with sarcasm, "The Rules To Being A Sellside Economist” makes for an entertaining Friday read,
“Whenever something unexpected happens, like extreme weather or a government shutdown, industrial action or trade tariffs, a financial journalist will always want to know what this means for the macro economy. You need an estimate that is high enough to matter, but not so large that it would force you to change your forecast or look obviously wrong within a few weeks. A good rule is that the event will add or subtract 0.3%pts from GDP’
““ The Rules To Being A Sellside Economist” – TS Lombard
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The Financial Times cited analysis showing that electric vehicles are only marginally more environmentally friendly than diesel cars,
“Due to the energy intensive nature of battery production, it takes roughly 120,000 kilometres of use for the e-Golf to have a lower emissions… Of course, it does depend on where the electricity used to charge the car comes from… A final observation here is that, as Emissions Analytics — a leading consultancy — have argued, hybrids are the best means we have right now to reduce carbon emissions”
“The electric vehicle carbon emissions debate” – Financial Times (paywall)
“Hybrids are 14 times better than battery electric vehicles at reducing real-world carbon dioxide emissions” – Emissions Analytics
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Diversion: “Age of Invention: Escape from Malthus” – Anton Howes
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