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New Security Policy & September PCE ?3

10:15 05-Dec-25

PCE for September came in at +0.3% for the headline and +0.2% for Core, both of which were in line with expectations.  Income was a tenth higher than forecast at 0.4% while spending was a tenth lower +0.3%.  Again, all of this is consistent with stagflation, and the market doesn't care as FedWatch still shows an 87% chance of a quarter point cut next week.

We got a new statement on National Security from the White House overnight.  It cites the Monroe Doctriine four times, but goes further by rejection global dominance for America or any other power.  That much seems reasonable in principle, but there is also over the top criticism of European policy and some ranting about immigration.  Where the former concerns Ukraine, it ignores the history of appeasement which lead to WWII.  When viewed in the context of the administration's disregard for due process, both internationally and at home, and the SCotUS rubber stamping gerrymandering in Texas, markets should expect continued dysfunction from Washington for at least another two years.  As a reminder, some speculate that military action will be used as a distraction from rising health care premiums at the end of December and congressional budget battles coming to a head in early March.

To wit, PCE numbers for September should be released at 10AM this morning.  There will be an update when they are available, but being over a month late, it is doubt fulthey will affect markets much.  So far, there is no firm date for the November numbers, which would normally be due on December 19th.

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