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Let’s take a step back and get away from the media’s hyperbole and hysteria regarding the two inflation reports last week. Essentially, consumer prices were a little hotter and producer prices were a little cooler. That’s really it in a nutshell.

The market was pricing in up to 7 rates cuts in 2024, which I have viewed as absurd. As I mentioned the other day, if the Fed has to cut anywhere near 7 times, we will an economic catastrophe that warrants that. I would bet heavily on the under folks.

And for all the fire and brimstone, the S&P 500 remains just one good day away from new, all-time highs. That’s it. Santa Claus may not have called and the first five days of the year may have been down, but the bulls continue to hang in and perhaps work towards the mid-January peak scenario I have been watching out for.

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Earnings season has begun with the high profile banks starting to report last week. So far, it has been mixed, with JP Morgan, Citi, Wells Fargo, and Bank of America. After this pullback ends, I expect banks and financials to see another significant rally.

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Here we go again. After some beautiful snow a week ago, Mother Nature delivered some precipitation of the non-frozen variety with more on the way along with major winds. A big sigh in eastern ski country. At least we have 6 NFL playoff games on the docket along with countless college hoops.

On Monday, we bought XME. We sold levered S&P 500. On Wednesday, we sold XME, MOS, and some levered NDX. On Thursday, we bought PCY, EMB, SSO, and more levered NDX.

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