Retail Sales Miss After Inflation Comes in Hot

Retail Sales Miss: January retail sales came in significantly weaker than expected, dropping 0.9% (vs. expected drop of 0.2%). When excluding autos and gas, it was down roughly 0.5%.
Context: The decline is attributed partly to severe winter weather and wildfires in California, but analysts also note a genuine pullback by consumers due to high prices.
Inflation (PPI/CPI): Earlier in the week, both CPI and PPI inflation data came in “hotter” (higher) than expected, complicating the Federal Reserve’s path to cutting interest rates.

Ed Yardeni (Yardeni Research)

Economic Outlook: Believes the “soft landing” or “Nirvana” scenario has been achieved with unemployment at ~4% and real GDP at ~3%.
Fed Policy: Argues there is no reason for the Fed to lower interest rates anymore. He notes that bond yields actually rose after the last rate cut, signaling the market disagrees with cuts.
Stock Market Forecast: Remains bullish. Predicts S&P 500 earnings of $285/share in 2025 and $320 in 2026. Targets S&P 7,000 in 2025 and 8,000 in 2026.

Stephen Englander (Standard Chartered)

Tariffs: Discusses President Trump’s “reciprocal tariffs.” He believes they will deliver less revenue and import substitution than promised because the gap between U.S. and global tariff rates isn’t actually that huge.
US Dollar: Sees a short-term bear case for the dollar in the first half of the year but believes disinflationary tendencies are more powerful than the Fed acknowledges.

Jennifer Lee (BMO Capital Markets)

Consumer Health: Notes that while weather played a role in the weak retail sales, the “goosing up” of data is fading. The consumer is facing a “burden of elevated prices” leading to a slowdown in consumption.
Canada/US Trade: Highlights that 75% of Canadian exports go to the U.S., making any tariff war a massive risk for the Canadian economy .

Katy Kaminsky (AlphaSimplex)

Trend Following: Her strategy is currently Long Equities, Short Fixed Income, and Long Gold.
Gold Rally: Highlights Gold as a “favorite trend” driven by a lack of supply and excess demand (central bank buying), acting as a safe haven.

Lindsay Piegza (Stifel Financial)

Contrarian/Bearish View: Unlike Yardeni, she sees stagflation risks. She predicts real GDP could fall to sub-1% for the next 12-18 months while inflation remains sticky.
Fed Predicament: Believes the Fed is “desperately trying” to cut rates to provide relief but cannot justify it with inflation heating up again.

Trump’s Reciprocal Tariffs: President Trump signed measures to impose reciprocal tariffs on trading partners, stating, “whatever they charge us, we charge them”.
Government Job Cuts: The administration is proceeding with slashing the government workforce, handing out “pink slips” at the Dept of Education, EPA, and SBA.
RFK Jr. Sworn In: Robert F. Kennedy Jr. was officially sworn in as the Secretary of Health and Human Services (HHS).
JD Vance in Munich: Vice President JD Vance addressed the Munich Security Conference, stating the biggest threat to the U.S. is “the threat from within,” focusing on social media and free speech rather than traditional external threats like Russia .

Auto Insurance Inflation: Noted as a specific pain point for consumers, rising 11% annualized.
YouTube’s Anniversary: Mention that it is the 20th anniversary of YouTube, which has fundamentally changed media consumption.