Today’s US Q1 GDP release, +1.8%, completes a recent exercise for our clients, and, provides a lesson in market observation.
We predicted Mar/23 that forecasters would cut their estimates for GDP substantially. After a few weeks, all had done so. Today’s result was even below that new consensus.
We’re not seers, no brighter than the next guy. Key is that, as trout are slow to recognize, then slow to give up on a certain insect (see our Apr/3 post - Observations at Stream Side) so the market crowd are always 1) slow to adopt a new reality and 2) slow to let it go, willfully blind to what a few independent observers can easily understand to be reality.
This is a great little guide in one’s voyage through the market maze, and it’s every bit about crowd behavior.
Finally, to today’s discouraging Jobless Claims release (429 vs 390, consensus). We predicted Apr/25 in Potential For Worry, the Week Ahead that both today’s GDP and Jobless Claims releases carried more potential to worry the market than to cheer it. That was the result.
Robert Craven
We predicted Mar/23 that forecasters would cut their estimates for GDP substantially. After a few weeks, all had done so. Today’s result was even below that new consensus.
We’re not seers, no brighter than the next guy. Key is that, as trout are slow to recognize, then slow to give up on a certain insect (see our Apr/3 post - Observations at Stream Side) so the market crowd are always 1) slow to adopt a new reality and 2) slow to let it go, willfully blind to what a few independent observers can easily understand to be reality.
This is a great little guide in one’s voyage through the market maze, and it’s every bit about crowd behavior.
Finally, to today’s discouraging Jobless Claims release (429 vs 390, consensus). We predicted Apr/25 in Potential For Worry, the Week Ahead that both today’s GDP and Jobless Claims releases carried more potential to worry the market than to cheer it. That was the result.
Robert Craven
No comments:
Post a Comment