The economy grew 3.4% in the third quarter. Economists expected less. Economists also expected your calls to print, so adjust accordingly.
September inflation accelerated. The Dow Jones consensus wanted a 0.5% monthly rise in the PCE price index, for an annual rate of 3.7%. The number is the number. Nobody asked the chart.
Here is what the chart says. Price is price. It does not know what the Bureau of Economic Analysis is. It has never read a PCE release. It has no feelings about services spending.
You, however, have feelings. You read "better-than-expected growth" and "accelerating inflation" in the same sentence and felt your thesis wobble. Which thesis? The one you built Tuesday. On a napkin. At a Chili's.
The Federal Reserve now gets to look at a hot economy and hot prices at the same time. Jerome Powell will spend the coming weeks speaking in sentences designed to mean nothing. You will spend them parsing those sentences like they are the Dead Sea Scrolls.
Consider the beauty of it. Thousands of analysts built models to predict a figure. The figure arrived. Some were close. Some were not. All of them will explain with total confidence why it made sense afterward. That is not analysis. That is a sports talk radio call-in show with a Bloomberg terminal.
Retail traders will now buy the dip on the good news and sell the rip on the bad news, then reverse both at the open. You will call this "reading the macro." Your brokerage will call it Thursday revenue.
I look at a 50-day moving average. It has never once been surprised by a PCE print, because it has never once been awake.
Growth was 3.4%. Your account is not growing at 3.4%. Your account is growing at the rate of a houseplant in a closet, and your wife has stopped asking about it.
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