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Week Ahead Jun 9-13

I hope everyone is having a nice weekend. The weather here in Montreal is finally beautiful, so I plan to play some tennis and enjoy the pool. But first, let’s recap what we are seeing in macro and also see what we have in store for the week. The title of the note refers to the window of weakness that many have referred to around liberation day. I believe that window is now closed. We are now at the stage where demographics matter as I will explain in the note.

In terms of the eco calendar, tomorrow we get an update to the NY Fed’s inflation expectations survey (I’ve covered previously that it is flawed and if we adjust to UMICH methodology, they are virtually the same). On Tuesday, we get NFIB optimism index and Redbook Sales. Wednesday we have mortgage applications and CPI. Thursday we have PPI and claims. Friday has UMICH.

How do we begin anywhere besides the shocking Elon vs. Trump feud, which played out in real-time across social media? It had a very large impact on TSLA’s stock, with each headline chopping it down quite a bit and we only saw a modest recovery on Friday despite a very bullish day in the market. I am not going to get into the details of their spat, but my takeaway is this raises the odds of the tax cut bill passing, not decreases it. Elon spent 10 days before this escalation rambling against the bill, and there had to be a concern that he would influence some Senators that are on the fence. However, as soon as he went personal against Trump and Trump was tame in his comebacks (for his standards, to be clear), it came across as Trump was quite hurt by the whole thing. At this point, despite Elon’s widow maker money, I think the GOP rallies around their leader. The GOP is Trump’s party and has been for 10 years.