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Fireside Charts
The first inflation print of the year came in hotter than expected. There may be more of the same ahead, according to both market and sentiment-based indicators. U.S. consumer credit saw its largest month-over-month increase ever in December, but that may not be as bad as it sounds. Evaluating the market’s reaction to DeepSeek. How are people using generative AI? Magnificent 7 earnings growth. Japanese interest rates. The China vs India. The cost of a penny.
1. Hopefully this is just the same residual seasonality that boosted inflation readings upwards in the first quarter last year.
Source: The Daily Shot 2/13/2025
2. The 5-year inflation breakeven rate is at its highest level in almost two years:
Source: The Daily Shot 2/12/2025
3. Consumers are expecting more inflation in the short term:
Source: The Daily Shot 2/10/2025
4. Perhaps more concerning, long-term inflation expectations are becoming “unanchored:”
Source: The Daily Shot 2/10/2025
5. U.S. consumers turned to debt to finance their spending in December:
Source: The Daily Shot 2/10/2025
6. But consumer credit is at its lowest level, as a percentage of GDP, in over a decade:
Source: The Daily Shot 2/10/2025
7. All eyes were on the steep decline of Nvidia, and other AI infrastructure beneficiaries, but shares in companies that are perceived to benefit from cheap AI rose:
Source: Goldman Sachs; @MikeZaccardi
8. I find myself using generative AI mostly to edit my writing and assist with coding:
Source: Deutsche Bank Research
9. Earnings growth for the Magnificent 7 is expected to converge with the rest of the S&P in coming years:
Source: Goldman Sachs; @MikeZaccardi
10. Japan wanted inflation and, now that it’s here, rates are moving higher rapidly:
Source: The Daily Shot 2/12/2025
11. India outperformed China consistently from 2020 through 2024, but the trend may be reversing:
Source: @AlfCharts
12. One of the arguments against retiring the penny is that it may lead to more demand for nickels, which are even more expensive:
Source: @chartrdaily
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