MAGA policies are resulting in MACA
MACA stands for ‘Making America Cheap Again’ in stock market terms. A catchy phase we came across last week. This is more than appropriate following the sharp retreat in US equities, the US dollar and Bitcoin. Only gold and US Treasuries remain in favour.
The idiom "to put someone's nose out of joint" can be described as an informal way of saying to offend or upset someone. It can also mean to thwart someone, especially by taking something they wanted. Not a bad way to describe Donald’s (and his co-pilot Leon’s) first month or so in office. Think Federal workers in America. Or Greenland and Denmark, Canada, Mexico, the entire European Union, Ukraine, NATO and China. Have we missed someone out?
Yesterday’s daily highlighted a number of deteriorating data releases in the United States. With equities trading off from recent record highs it is unsurprising that investors have become somewhat cautious, best illustrated by the performance reversal of the Magnificent Seven. Only some soothing commentary from Federal Reserve Chairman Powell in a speech at the end of last week allowed equities to find their footing.
The very weak data out of China on Sunday is unhelpful. February’s consumer price index declined 0.7% from a year earlier, substantially lower than expected. Core CPI turned negative (-0.1%yoy) in February for the first time since January 2021. The world’s second largest economy (actually the world’s largest in purchasing power parity terms) continues to splutter. Recent positive speeches at the National People’s Congress (the highest organ of state power of the People's Republic of China) on the need to reinvigorate the Chinese consumer need to be turned from words to action. And fast.
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