DC Lite #502

1. CPI. "As people debate shelter measurements, worth flagging that supercore inflation, which excludes food and energy like core, but also shelter and used cars, also had a remarkably low print."

2. Unemployment forecasts. "Out of the 60-odd economists surveyed by Bloomberg, not one expects a rise of more than 40bps. We have to admit that this is a little troubling, not least because economists have a bad habit of systemically underestimating unemployment once it starts to increase."

3. Dissents. "Powell oversaw one of the least dissenting FOMCs … As the next chair is expected to be more beholden to the White House and Treasury, the consensus is that there will be more open dissent among FOMC members."

4. Household cash. "Households continue to hold near-record cash balances (98th percentile historically), leaving substantial dry powder should confidence and risk appetite continue to improve. We see this 'buy-the-dip' behavior, every day in our data at Citadel Securities."

5. Mag 7 vs. Impressive 493. "Our thesis is that in 2026, competition will slow the growth of the Mag-7s' earnings, while the AI services that they provide will boost the productivity and earnings growth of the Impressive-493. That's consistent with our Roaring 2020s scenario."

ICYMI