DHUnplugged #669: Waiting Game

A new Closest to the Pin announced.

UAW strike lingers...

Fed rate decision ahead.

Consumers are feeling the pinch.

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Warm Up
- Announcing a NEW Closest to The Pin this week
- Plenty of interest in new legislation up for vote
- Retail worried about holiday season - hiring trends
- Clorox Update
- Waiting  and Waiting for Fed decision - markets on hold...

Market Update
- Ugly and the the week - markets spooked on inflation and eco
- Wednesday is the day - Fed rate decision meeting
- UAW Strike
- EU Leaking proof it's decisions
- Oil prices starting to pinch

Commentary
- Overall - markets are in a consolidation mode, eco is relatively strong with a few dispensed pockets of weakness.
- Consumers are starting to feel the pinch
- Several bears have finally capitulated - that is a concern (another one of those one sided things that is never discussed - when bulls capitulate it is good - when bears capitulate - it is good)"
- Oil prices - that is a concern
- Yields still rising
- China may be bottoming - that is good sign
- Inflation - slowing down, but Fed may have more work to do
- Earnings outlook - hard to image much better from here - what is important is the forward multiple

Fed Heads
- The Federal Reserve is unlikely to raise interest rates at its Oct. 31-Nov. 1 meeting, Goldman Sachs strategists wrote on Saturday, while also forecasting the U.S. central bank would lift its economic growth projections when policymakers gather next week.
- "On November, we think that further labor market rebalancing, better news on inflation, and the likely upcoming Q4 growth pothole will convince more participants that the FOMC (Federal Open Market Committee) can forgo a final hike this year, as we think it ultimately will," the investment bank's strategists wrote in a report.
- Current market bet s that there will be no hike this meeting - but potential for hike (0.25%) next meeting

Some Legislative Stuff

MJ Bill
- The Senate Banking Committee has scheduled marijuana banking legislation for a vote on Sept. 27, a much-anticipated move that would advance one of Senate Majority Leader Chuck Schumer’s top priorities to the Senate floor.
- The bipartisan SAFE Banking Act sponsored by Democrat Jeff Merkley of Oregon has bipartisan support, including from the lead Republican sponsor, Steve Daines of Montana, who heads his party’s campaign committee.
- Backers of the legislation have been increasingly optimistic they will easily exceed the 60 votes needed
- If signed into law, the SAFE Banking Act would enable cannabis-related businesses (CRBs) to transact business by means other than cash

Credit Card Legislation
- Credit Card Competition Act of 2023
- It would require the largest credit-card issuing financial institutions in the country—those with assets over $100 billion–to enable at least two credit card networks to be used on their credit cards instead of just one, and at least one of those networks must be a network other than the Visa/Mastercard duopoly.
- There is concern that this bill will potentially reduce airline (and other) reward points as competition will drive transaction fee prices down and need to drop incentive programs
--- - HEADLINES on socialize media and internet about how this bill kills reward programs - however, does not seem that is a true statement
- Similar legislation failed to pass in 2022

Oil
- Recap of our discussion last week - Oil looks like destined to keep moving to $92 - then what?
- Currently trading at $91
- A move above $92 would put $95 in play - as long as OPEC+ keeps with voluntary production cuts

Retail Confidence