Wampanoag Week

US investors will pause this week in solemn remembrance of the generosity bestowed upon early settlers by benevolent locals who, as it turns out, shouldn’t have been so generous.

Who knows what actually transpired prior to and during any “first Thanksgivings” (historians think they know, but not having been there, it’s hard to say). What we do know is that without an assist from the people who were unknowingly witnessing the beginning of the end for their way of life, the settlers would’ve had even more trouble than they did.

Several centuries later, the original Americans are largely relegated to an unfortunate collection of de facto colonies (a tragic irony if ever there were one), and new Americans celebrate the autumn harvest with awkward buffets, typically featuring core family members, an eclectic mix of peripheral relatives and a few extras (somebody always brings the new fiancé).

In modernity, the formal, at-the-table meal lasts only as long as it has to. Around 15 minutes in, anyone younger than 21 excuses themselves to their social media timelines. Shortly thereafter, most of the remaining males at the table excuse themselves to the living room to observe a tangential, and even more sacred tradition: Thanksgiving NFL football.

Most of the food isn’t eaten immediately, but rather left out, typically on large kitchen islands, under tinfoil, for people to pick at for the rest of the evening. At roughly 8 PM, local (usually core) family leaves, accompanied by a semi-sincere show of affection characterized by what I call “distance hugs” (where outstretched arms do the majority of the work because legs and torso remain five feet apart) and mafia-style cheek kisses.

Around 10 PM, the host family secures the edges of the tinfoil on the dinner dishes which all go into the refrigerator, irrespective of whether a given item needs to be refrigerated. A few minutes later, the host family reminds the peripherals (who almost invariably come from out of town and are thus consigned to an awkward night in a house that’s not theirs with people they barely know) where the fresh towels in the guest bathroom are. Then everyone retires to rooms with closed doors.

I’m not sure the Wampanoag would be enamored. And, really, I don’t think Susan Page would be either. Of course, nobody cares what she thinks anymore. For two decades, her indelible gaze upon opening the door for two weary travelers was as synonymous with the last Thursday in November as turkey and cranberry sauce. Today, she looks out at no one from dying cable television channels. Americana is passé. Those who want to set the clock back to a bygone era pine away for all the wrong things about the country’s past. And those who rightly seek to relegate those wrongs to the dustbin of history are so busy banishing the bad that they can’t be bothered with what was good.

In any case, Thanksgiving is a Christmas rehearsal. If you don’t like your family, it’s an opportunity to secure a get-of-Christmas-free card by way of attending a lesser event a month earlier. Either way, you can count US investors largely out for the week. There’s no US data on Monday to speak of. Tuesday brings the Richmond Fed, which isn’t even a third-tier report.

Mercifully for people like myself for whom this week is just like any other week, Wednesday at least offers a few notables. Flash reads on S&P Global’s manufacturing and services sector PMIs are due, as is the final read on University of Michigan sentiment for November.

Manufacturing activity is on the brink of contraction, according to S&P’s gauge. The services sector is already there (figure above). The US economy is sending out a dizzying array of conflicting signals. Barring truly dramatic downside misses, the flash PMIs’ capacity to move markets is limited.

More importantly, data on new home sales is expected to show a 5.5% decline for October (figure below). The range of possible outcomes there is wide. Last week’s housing numbers found builder sentiment notching an 11th straight monthly drop in November, while NAR figures showed existing home sales fell a record ninth month in October.

It’s worth watching the median prices for new homes going forward, but it may be a few more months before you see a sustained drop. I imagine builders will attempt to avoid price cuts wherever possible. In a sense, what you see isn’t necessarily what buyers are getting. Rate buy-downs are margin for somebody. Points cost money, after all, and if the buyer isn’t paying them, someone else is. Keep that in mind amid “buoyant” prices.

Also on deck Wednesday: The November Fed minutes. As a reminder that no one needs, Jerome Powell managed a daring (and unlikely, considering his history of communications missteps) feat of policyspeak during the post-FOMC press conference this month. He successfully put a hawkish spin on the “step-down” narrative, which markets were very eager to trade dovishly. Terminal rate pricing responded, and has since oscillated around 5% depending on the ebb and flow of the incoming Fedspeak and data.

Ostensibly, the minutes will provide further clarity into the Committee’s thinking, but market participants have heard from so many officials since early November that it’s hard to imagine traders viewing the account of this month’s policy gathering as anything other than stale. That’s particularly true in light of the cooler-than-expected CPI prints, a likewise benign read on producer prices and Fed speakers’ uniform messaging around those data points: “It’s just one month.”

“We’re anticipating the minutes will strike a decidedly hawkish tone given the current macro backdrop [and] in keeping with the theme, pre-Thanksgiving trading conditions combined with the extremes of the curve inversion already reached leave us biased to see 2s10s probe deeper, if anything,” BMO’s Ian Lyngen and Ben Jeffery wrote, adding that the Thanksgiving holiday “will effectively create a three-day trading week.”

Markets will hear from Mester, George and Bullard. Again.


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6 thoughts on “Wampanoag Week

  1. Me and my brothers where all lined up on the couch with a peripheral member a female sitting next to us when a game changing play in our favor occurred. We fired off of the couch to cheer in a manner that Curly Lambeau would want his players firing off the line. If there would have been something to hit the collision would be swift and violent. I happened to look over at our newest clan member and saw a look of fear and ah on her face. Her brain was trying to process it all, great memory. Great article. Even greater gift sub ad placement.

  2. “Mercifully for people like myself for whom this week is just like any other week…”

    Do you do housecalls? Thanksgiving would be so much more entertaining with you at the table. I promise the Turkey is only a little dry, and the more you insult the Qanon Uncles the more quickly I’ll refill your wine glass.

  3. Unfortunately, one’s best option might be to remove any toxic family members from any circle- close or distant.
    Besides, who likes turkey enough to eat it for a week? My kids love spicy seafood gumbo!(Williams-Sonoma recipe, for those needing a recipe).

  4. I’m Grandpa, my wife is Grandma, and everybody is coming to Grandma’s house to see Grandma for Thanksgiving. When I die someday, somebody in our family will ask Grandma if she was ever married.

  5. I propose a more enjoyable, more wholesome way to celebrate the fall harvest (and never mind the cultural myths): Friendsgiving!

    In my town it’s become popular to host a pot luck dinner in early November, bringing a variety of local people together who know the hosts but may otherwise be peripherally connected.

    We can’t choose our family, but most of us DO choose whom to spend our lives around; it seems natural to celebrate harvest with our “found family” and our own social circle, rather than the family we were born to. Friendsgiving has all of the trappings of Thanksgiving without the animus and callous behavior. Since the guests live nearby, timing is more flexible and hosting obligations are kept in check.

    We can’t undo what happened to the Wampanoag, but with a bit of effort we could rebrand the harvest holiday in a less hurtful way. I’m fond of “Samhain” myself, but that’s probably too high-brow for most. Whatever we call it, I’m all for this new, family-free holiday to counterbalance the winter festival — Christmas et al — which remains a family affair.

  6. Our Thanksgivings are akin to an Island of Misfit toys – a motley crew of friends who have no other plans and responded affirmatively to a last-minute invite. We are also banishing turkey this year. The required playlist is always Burt Bacarach. Other than the five HEPA air cleaners at full blast, we hope to have a pre-pandemic kind of get-together. Cheers to all in H-ville.

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