Good Afternoon on this best day of the week, Wednesday, November 13, 2024

Today is among other things, bond rollover day.

What that means is if you are a chartist, which you are likely not, you may see a change in bond prices, but this does not impact rates as the coupon rollover cost is averaged in throughout the month. That said, the cost was about +15 bps and when we add that to where the market is today +11 bps after CPI came in right on expectations (.2% overall and .3% core or the month) we are up about 26 bps for the day, YAY. The 10yr has been all over the place but has settled in at unchanged for the moment at 4.44% (not a yay).  While Bloomberg Economics doesn’t expect the report to be a determining factor in the Federal Reserve’s next rate decision, markets seem to have reacted well driving the odds at another Fed cut in December to 75% (yesterday we were at 62%).

Tomorrow brings PPI and Friday, Retail Sales so volatility is likely to be higher through the end of the week.

President Trump is on his way to forming his new government. As promised, Elon Musk and now, Vivek Ramaswamy will lead a new Department of Government Efficiency (that’s right, DOGE) under Donald Trump. The president-elect has tasked the two entrepreneurs to “dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies.” Musk said, “This will send shockwaves through the system.” It sounds like a great idea. Let’s hope adding to the government ends up being a net gain for all of us.

Stay safe and make today great!!!