The Banking and Strategy Initiative

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US Economy: ICSC sales put on brakes, Case Schiller worst since 2006, Health back with a GOP agenda?

Though the Fed would have preferred being proved right ont he continuing recoevery its indicated fears are coming true though no Jobs number is due this Tuesday. The Weekly Goldman ICSC retail indices are on mark to losing the 3% watermark with a 2.7% growth this week in retail sales Y/Y, the weekly data down 0.5%.

On the home prices front, the Case Schiller index also though never expected to improve reached a Seasonally adjusted (SA) and NSA loss of 4% Y/Y in December and even as the Monthly data held on to last months Seasonally adjusted figures, the Y/Y rate remained 3.8% and NSA data lost an additional 0.8% from December Miami Phoenix and Wash DC posted increases as the rolling index includes transactions from November to January for 20 cities

N o deterioration is expected int he GDP reports later in the week as the Durable Goods data feeding the ISM number is expected to improve and Jobless claims still around the 350k mark. Though investor confidence data is due later today, France and the EMU report crucial GDP and money supply data this week to show the depth of the coming recession and as the markets get used to the statements of continuing accommodation from Bernanke to not include the unavailable room to add more money into the markets, the market may correct down from these marks at a paced level with low volumes in trading however increasing chances of a bad cut but with the Chicago PMI data also up in the 60s and the Richmond Survey today likely to follow the other Feds into positive terirtory, most of the market is used to the middling perfromance of the recovery and no more room for improvement with housing price lows preseting an extended window of opportunity for retail to enter, which is yet unlikely and thus may delay recovery.

In the Healthcare case to defend the Obamacare master book the Patient Protection and Affordable Care Act, today’s arguments will move from the Anti Injunction act which indeed does not apply, to the government crossing its Commercial powers in demanding from individuals to mandatorily get health insurance. Chief Justice John Roberts leads a bench that includes J. Sonia Sotomayor, J. Ruth Bader Ginsberg, J. Stephen Bryer , J Sam Alito and J. Antonin Scalia. The individual madate in the Act, may bring down the entire act even as it potentially brings in upto 24 mln Americans under the Health insurance fold and excludes all americans below the poverty line , including waiving penalties for individuals and couples’ whose Premiums exceed 8% of their pay check.


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