Debts are piling-up…with more Americans challenged to keep-up. That’s my take on the credit card debt and delinquencies, which might be viewed with a bit more concern that expressed by the ‘bah humbug’ FOMC Minutes today. depositphotos I think it’s also more important than the Nvidia (NVDA) focus or big-cap tech for now. It may also temper so-called consumer optimism, also reflected by Target or others that mostly cater to the lower ‘retail range’ of consumers, then markets act surprised when they get hit (shouldn’t as this is ongoing). However, tough consumer conditions, may also mean a rate cut coming before just very late this year, or not at all, as David Solomon (Goldman Sachs) suggested today. GS/Solomon says ‘not at all’, I disagree… just look at ‘consumer cyclicals’.Perhaps elitists don’t see the challenges average families feel, and dismiss it by rationalizing people keeping cars longer since ‘older are better’. That may be the case in a few instances (like mine haha), but generally it’s the reflection of lack of new car affordability for the lower economic segments (as well as awareness of trend changes to EV’s, absurdly high prices and so on).  The FOMC Minutes came out today, talking of ‘higher for longer’ but calling for inflation to ‘edge down towards the Fed’s target’ over time. Sort of odd until we realized these Minutes were before the latest data-stream series, which in fact tamed some of the hawkish zealots among the Fed.So not much change, just doubts about whether restrictive enough (failing to recognize that higher rates themselves contributed to juicing inflation further), but overall, probably a non-event or minor event, if you try contextualizing this more than we just did. Basically, it says the Fed’s on the right track but not yet there, and that basically makes sense.The Fed was too low for too long, then rushed rates higher (contributing very clearly ‘to’ inflation), and now is sort of stagnant pending a slight easing trend. Now, you have most consumers extremely vulnerable or doing what they can to hang on, as evidenced by a significant increase in people working two jobs, likely trying to make ends meet. This is not sustainable, and the Fed knows it.  Market X-ray: We’re starting to get some easing of the ‘pace’ of inflation, but as I’ve contended for months, not much (if any) actual price relief. Hedging is sort of back in vogue, just because the S&P is so high for so long and values are generally not there, as the ‘air pockets’ in a couple stocks clearly showed. You didn’t have to wait for Palo Alto Networks, Lululemon or Target reports to see this evolution, while the focus on Ai and tech overall shows resilience.More By This Author:Market Briefing For Wednesday, May 22
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