Just a quick note today. The Consumer Price Index (CPI) came in a bit hotter than forecast, but that’s what the data were pointing at. I have written that inflation was likely finding a floor in the mid 3% area and that some increase was coming. But remember, the economy and markets are in very different places than they were two-plus years ago when the Fed was well behind the curve. Now, Powell & company seem to have gone too far.

Bonds and gold have been quietly sideways while the dollar has been strong, much stronger than I thought as you can see below. A stronger currency is a headwind for big, multinational companies as well as oil, gold and other commodities which are priced in dollars. A stronger dollar has become somewhat of a “safe haven” for investors, but that has not always been the case, especially in the mid-1980s.

(Click on image to enlarge)

Stocks have also been quiet of late which usually means a bigger move is coming. The major market indices are caught between the August peak and the September low. A breach either way should lead to some movement quickly.

On Monday we bought NUGT. We sold levered S&P 500 and some ERX. On Tuesday we bought FENY, levered S&P 500 and more NUGT. We sold some levered NDX.

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