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March 23, 2025 | The Inflationista Illuminati, Part 2

The theme among so many writers seems to be “vibe shift.” And indeed, there is a concern the economy is slowing and may even be in a recession. That is certainly what today’s writer and my friend, Danielle DiMartino Booth, points to in this second part of her data-driven inflation analysis, which I share below. […]

March 16, 2025 | The Inflationista Illuminati

Last week we published a chart of the Atlanta Fed’s GDPNow model, which had just dropped sharply to a -2.4% real GDP growth forecast for the first quarter of 2025. This model can be volatile. Its latest big swing was mostly an artifact of spiking gold imports. Economic growth prospects do seem to have dimmed […]

March 10, 2025 | When Valuations Collide…

“Stock prices have reached what looks like a permanently high plateau.” —Yale economist Irving Fisher 12 days before Black Monday in October 1929 “Wall Street indexes predicted nine out of the last five recessions!” —MIT professor Paul Samuelson in 1966 Last week, we explored the Crestmont Stock Market Matrix and its insight into the drivers of stock […]

March 2, 2025 | The Bull’s Eye Matrix: Updated

Bull’s Eye Investing was published on January 1, 2004. It quickly became a bestseller. The main thing that people still ask me about was a trifold spread color chart of stock market returns since 1900. Returns were color-coded so readers could see the ebb and flow of returns over time. That remarkable representation of market performance […]

February 24, 2025 | Revenue Thoughts

Last week we began discussing the import tariffs President Trump has been threatening. Most (China is the exception) have not taken effect yet. It’s possible they will never happen or will be quickly modified or rescinded as happened in Trump’s first term. Real or not, the fact these tariffs might happen affects business and consumer confidence, which […]

February 16, 2025 | Trump Confusion Syndrome

I think I’m going to start a new 12-step program. I sense there are a lot of potential members. The meetings would start with something like this: “Hi. My name is John. I have Trump Confusion Syndrome. I don’t think it’s contagious, but many of my friends are suffering similar symptoms. “I like a lot […]

February 2, 2025 | Why DeepSeek Is Bullish for the World

“There are decades when nothing happens, and weeks when decades happen,” says a quote from Vladimir Lenin, who may have copied it from someone else. Regardless of origin, it is true and will be even more true as technology and even government changes faster. We may have just lived through such a week for the […]

January 19, 2025 | A Possible Storm

Rain can be either refreshing or destructive. It can make plants grow or produce devastating floods. But in all cases, it’s largely outside human control. Or is it? True, we have little control over whether rain will fall. We have a lot of control over how it affects us, though. Sturdy homes and good infrastructure can keep […]

January 12, 2025 | A Partly Cloudy Year

Weather forecasters tell us what kind of weather we should expect. They can be wrong, but their short-term outlooks are generally reliable. The old joke that economists exist to make weathermen look good is funny because it has a ring of ironic truth. Other things aside, though, we usually prefer moderate weather. Most of us would be […]

January 5, 2025 | A Controversial Start

It was an amazingly short week, punctuated by making 20 gallons of chili, serving almost 300 of my neighbors, and then recovering the next day, which didn’t leave a lot of time for in-depth analysis and forecasts. I’m sure you will be happy with the shortened letter as we cover some of the main events […]

December 29, 2024 | Live Free and Don’t Die

As I said last week, I am working on a book outlining five different theories on historical cycles and how they all seem to “climax” around 2030. I’m also very concerned that around that time (if not before), we will see the bond market begin reacting to the increasingly large national debt. I came across […]

December 22, 2024 | Quantum Supremacy

As longtime readers know, I am working on a book outlining five different theories on historical cycles and how their predicted “climaxes” all occur around 2030. I’m also very concerned that around that time (if not before) we will see the bond market react badly to the fast-growing national debt. While my poor editors at […]

December 15, 2024 | Demanding Energy

Energy is everything. Or, if Einstein was right, you and I are just energy in material form. Accelerate us to lightspeed squared and we might become something else. All economic activity involves converting energy from one form to another. This requires harnessing sufficient quantities of usable energy. That task is becoming more difficult, to the point economic […]

December 8, 2024 | Homes for Christmas

Ever notice how “home” is so important to our holiday traditions? It’s hard to imagine Christmas without images of a fireplace, a tree, some food, and rooms with festive decorations. Families gather in such rooms to form lifelong bonds and memories. My neighborhood here in Puerto Rico really goes all out on Christmas decorations. There […]

November 24, 2024 | Waste, Fraud, and Abuse

Politicians and think-tank wonks of all stripes love to condemn government “waste, fraud, and abuse.” But saying it isn’t hard. Who is the opposition? No one says we need more waste, fraud, and abuse. We’re all 100% agreed all three are bad. It’s when you get specific—saying this agency or that program isn’t accomplishing what it should—that […]

November 17, 2024 | The Trump Inflation Problem

Two weeks ago, I opened this letter by noting the election uncertainty, once over, would give way to a different uncertainty about what comes next. That’s where we are now. I fully expected a closer outcome that would take some time to resolve. Instead, we have an undisputed president-elect moving full speed ahead. And what […]

November 10, 2024 | Dogs Catching Cars

I went to bed “early” on election night, around 10:30 pm. We are in the five months of the year where Puerto Rico is one hour ahead of Eastern time, and nothing I was seeing made me think it would be an early night. And by that I meant 3 or 4 am. I woke […]

November 3, 2024 | One-Way Road to Crisis

Anyone else ready for the election to be over? This uncertainty is exhausting, no matter how you want it to end. But sadly, it won’t really end. We will just transition to a different uncertainty over what will happen next. I will offer my thoughts on the election at the end of this letter, after […]

October 28, 2024 | Broken China

Here in the US, people are obsessed with the impending election. It is perhaps the World’s Largest Guessing Game. We can look at polls and make our best guesses, but no one really knows what will happen. We just have to wait for more data which will (hopefully) be forthcoming November 5 or soon afterward. […]

October 20, 2024 | Frozen Homes

Official inflation data, while imperfect in many ways, at least has the advantage of being consistently imperfect. This lets us make comparisons across time. The magnitude may be off, but the direction is usually right (except at unusually sharp turns like 2020). Currently it shows most prices moving back toward “normal” with one prominent exception: housing, which […]

October 6, 2024 | The Crisis of Free Speech

“Freedom of speech” is a beautiful phrase, strong, optimistic. It has a ring to it. But it’s being replaced in the discourse by “disinformation” and “misinformation,” words that aren’t beautiful but full of the small, pettifogging, bureaucratic anxiety of a familiar American villain: the busybody, the prohibitionist, the Nosey Parker, the snoop. “…The end game […]

September 30, 2024 | The Revolt of the Public, Part 2

Two weeks ago, I began reviewing Martin Gurri’s important book, The Revolt of the Public, with this framework: “In my cycles book I’m reviewing the forecasts of Neil Howe, Peter Turchin, George Friedman, and Ray Dalio. For different historical reasons and patterns, all see a crisis culminating at the end of this decade. Some readers have […]

September 22, 2024 | Late Summer Sandpile

Last week, I said I would continue writing about Michael Gurri’s important book, The Revolt of the Public. It turns out giving a proper review of not just the book but all of the comments about the book will require more than a few days’ writing. I am going through almost 100 pages of new comments […]

September 8, 2024 | The Time Has Come

I remember traveling as a young boy on long trips and asking my parents, “Are we there yet?” I was later punished for this annoying behavior by having my own children ask me the same question over and over. On a national scale, we have been asking the same of the Fed. Now I think […]

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