Finance Unfiltered
Finance Unfiltered

Finance Unfiltered

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Bobby Iaccino, Jim Iuorio, and Mike Arnold combined over 90 years of active trading experience In stocks, commodities and options. Real trades described by real traders. Look us up on your own, and ask questions..

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Joined on 11th March 2025

Finance Unfiltered
Apr 02, 2025Public Post
Worst case scenario for stocks. Manufacturing falls into contraction territory, and prices paid INCREASED. Why do I care about manufacturing PMI? Because it has an extremely high positive correlation with the stock market. You can argue that it's not a massive part of our economy anymore, but the correlation is there... You can check it out yourself. Why do I care about prices paid by manufacturing companies, rather than consumer prices? Well, I care about both, but manufacturing prices have a very high correlation to inflation. I can explain why, but I also don't care why... the correlation is there. If the data keeps going like this (no guarantee of that), we enter a period of stagflation, the worst possible regime for stocks. This is not a reason for panic, but you need to be aware of it. - Bobby-
Worst case scenario for stocks. Manufacturing falls into contraction territory, and prices paid INCREASED. Why do I care about manufacturing PMI? Because it has an extremely high positive correlation with the stock market. You can argue that it's not a massive part of our economy anymore, but the correlation is there... You can check it out yourself. Why do I care about prices paid by manufacturing companies, rather than consumer prices? Well, I care about both, but manufacturing prices have a very high correlation to inflation. I can explain why, but I also don't care why... the correlation is there. If the data keeps going like this (no guarantee of that), we enter a period of stagflation, the worst possible regime for stocks. This is not a reason for panic, but you need to be aware of it. - Bobby-