WE’RE ON YOUTUBE NOW! See HERE & HERE (Yeah … I’m REALLY excited about this).

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Before you Trade Today: Know the Economic Calendar! Also See This Weeks Most Anticipated Earnings. NEVER BE SURPRISED BY EASILY ANTICIPATED MARKET BREAKING NEWS. That’s our goal here.

FAIR WARNING: Note that (including today) we are 2 TRADING DAYS AWAY FROM JUNE INFLATION DATA. 8.8% YoY Consensus (Revised upward). It’s actually on Wednesday morning but if you’re waiting until 0830 Wednesday morning to trade the inflation cut … well … I think the idea is questionable. We have plenty of uncertainty leading into those numbers & the market seemed to forget the impending inflation data last week.

UPDATE FOR PAID SUBSCRIBERS: Still sitting on three short positions. Two have printed for me, one is just stubborn & doesn’t want to move. You will also find some results from yesterday’s insider buy’s/sells. There are not significant earnings results from Friday to report (As is the case for most off season Friday’s).

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WEDNESDAY’S INFLATION CUT: We’ve been preparing for this day for the last couple of weeks. We know the job market & wages came in hotter than expected. We know June was the most expensive month on record for energy. We know that home prices are cooling, but scarcity is still keeping prices high … while rents are steady. However we also know that companies are having trouble offloading their inventory as people adjust spending habits due to inflated prices … meaning they may cut prices out of necessity. Do I expect inflation to remain high? Yes. Higher than expectations? It would not surprise me. Lower than expectations? That would surprise me!

Regardless, the job market is strong & inflation is high, so there’s no reason for the Fed to not continue increasing rates by .75bps … or more! Let’s go ahead & price that in … this will continue.

I SEARCHED HARD FOR SOLID COMPANIES TO BUY THIS WEEKEND: I don’t trust this market, however I thought some of my paid subscribers might like it if I found some companies to invest in slowly … over a long period of time … as opposed to the short play’s I’ve been publishing recently. So I set myself to the task of not only researching solid companies at great valuations, but I also screened their earnings for years back. The most recent bad year I was interested in was 2018. I was not impressed with what I saw. Highly frustrated in fact!

Note that 2018 was not a recession year, but the markets ended the year lower than where it started. Competition was stiff … earnings were horrible. What did I learn from the exercise? Folks … this market can do so much worse … in fact, it is highly likely in my view that it will. I think we are at the beginning of a bad earnings year. The past, I found, provided some solid perspective. I think we are far from bottom.

Sure the labor market is strong & wages are higher … but inflation is higher than wages & we are forgetting the majority of people who only received incremental non-inflation-beating pay raises over the years. I talked to someone who dispatched for an oil company. After accounting for pay increases, the individual complained that he made 14% less (inflation adjusted) than the day he started three years ago. He isn’t alone folks. And people in his position are getting slammed! I think the markets will reflect this! I’ve been saying for some time people are going to get priced out of the markets. This has not happened to any significant extent yet despite anecdotal evidence on inventories … which are kind of the canary in the coal mine.

Discouraged … I did not want to add any long plays. I don’t consider this market dump a readjustment to fair value, but rather a readjustment to slightly more reasonable valuations. Just wait until consumer staples start reporting negative EPS. Perhaps then is the time to enter long. Any time prior is just a waste of good money & a lower possible return in my opinion. Nevertheless I will keep my ear to the ground & let you know what I find.

WORLD MARKETS:

• S&P 500 futures slip ahead of kickoff to earnings season

• Hong Kong’s Hang Seng index down more than 2% as heavyweights Tencent, Alibaba plunge

• Hong Kong’s Hang Seng index down around 3% as heavyweights Tencent, Alibaba plunge

• European markets set to slide at the open as investors prepare for more U.S. inflation data

• Treasury yields ease lower ahead of inflation data later this week

TODAY’S EARNINGS & CONSENSUS EXPECTATIONS: