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Nomura’s McElligott: ‘Market’s Skepticism On Higher Inflation Is A Mispriced Risk’
On Monday, we brought you some highlights from the latest by Nomura’s Charlie McElligott who, in keeping with the recent rally in commodities and burgeoning reflation-related global risk-on sentiment, called for a “Cyclical Melt-up 2.0”.
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‘Don’t Get Caught Short Into October’s Cyclical Melt-Up 2.0’, Nomura’s McElligott Warns
By way of reference, here's the Bloomberg commodities index, which has surged of late thanks in no small part to buoyant crude prices that, muc
mark zandi (sp?) was on cnbc this morning….stated unequivocally “AHE is a bad metric”. he referred to instead the employee cost index, I think it was. ECI appears to lead AHE…there is a lag on reporting dates though of a few weeks.
HOWEVER…..both are lagging, as are ALL employment data. AHE hit a second top in early 2009…ECI topped early 2007, ebbed and only really fell late spring 2008……mkts had already hit -15% off highs by the tme this data started to roll over…and of course, the ‘2 consecutive quarters of negative gdp is a recession’ data point wasnt released until Jan30 2009!!! it was all over by the time tptb informed us (many people already knew this though. 2H 2007 and 1H 2008 were the times to have already gotten defensive….
Tops alwlays appear along side a good economy…and the error is linear extrapolation.
Today you have kept your stories shorter in length than usual H, but still to the point! I prefer it than the longer notes…