The Phily Fed survey has very good leading characteristics. Today’s Aug print (-30.7 vs +4.0, consensus) we thought must be a typo!
For this and other reasons, we now question our constructive view re Q4.
Insight delivered Q4, ‘10, most of H1 was satisfactory. But then, in choosing June/4 as the cyclical low on US interest rates we totally ignored potential world quality flight. In predicting on Aug/5 that equities were a buy and that yields were at a bottom (abandoning a tradition of many years to eschew just this sort of thing) we were simply reckless.
Robert Craven
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