US Economy: Chaos, Opportunity, Recession?

● Data Dumpster Fire

2024 US Economic Outlook, Latest Highlights: Retail Sales, PPI, Soft Data Discrepancy, and Stock Market Opportunities

Key Points Covered in This Article

Latest US economic indicators including the plunge in PPI, changes in retail sales data, Walmart’s price increase issues, decline in consumer sentiment, and Bank of America’s analysis of the soft/hard data discrepancy.
From the possibility of a US recession to stock market investment strategies, this article provides a timely summary of the key global economic situation in chronological order.
It naturally incorporates keywords such as global investment, US economy, recession, inflation, and stock market to provide insights by comparing them with domestic economic trends.

1. PPI (US Wholesale Price Index) and Retail Sales Indicators: Recent Changes

The US PPI (Producer Price Index) for April fell by 0.4% based on core inflation and 0.5% based on the headline figure.
This figure marks the largest drop in the last five years.
In the same month, US retail sales increased by 0.1% from the previous month, totaling $724.1 billion.
Compared to the 1.7% increase in retail sales in March, the growth rate has significantly slowed down.
Although slightly higher than Wall Street’s forecast (0.0%), it is explained by changes in consumption patterns (preemptive consumption due to tariff issues).
The sharp drop in PPI coupled with the slowdown in retail sales can be interpreted as a signal of easing inflationary pressures and a slowdown in US economic growth.

2. Inflation, Walmart’s Price Increase & Worsening Consumption Capacity

Walmart’s CEO and CFO have officially announced price increases.
Cost pressures have been steadily increasing since April, and price increases are expected to be felt in earnest in May and June.
Walmart holds a 25% market share in the US grocery market, significantly impacting the consumption of low-income households in particular.
Walmart’s price increase = Reduced US consumption capacity → Potential to accelerate a recession.

3. Recession Concerns and Changes in Market Sentiment

JPMorgan’s Jamie Dimon mentioned that the possibility of a recession cannot be completely ruled out.
Within the market, including Polymarket, the probability of a recession has recently decreased to 36~37%.
Although recession concerns have eased compared to the past, consumption and sentiment indicators remain sluggish.
Other indicators (such as the University of Michigan Consumer Sentiment Index) have also fallen to record lows in the short term.
Market sentiment is shrinking, accompanied by anxieties about consumer sentiment, price increases, and recession.

4. Historical Discrepancy Between Hard Data vs. Soft Data, and Investment Strategy Insights

Bank of America Research: The current phenomenon where hard data (real economic indicators) is fine, while soft data (surveys and sentiment) is sluggish, creating a large discrepancy, is historically almost unprecedented.
In this situation of discrepancy, there have been many cases in the past where the stock market and economy have generally rebounded.
“No recession while soft data is sluggish” → Average S&P 500 return of 17% in the following 12 months.
On the other hand, when a recession accompanies it, both returns and the economy are sluggish.
In other words, if a recession does not materialize as it is now, negative soft data alone is not enough to justify a continued stock market decline. It may rather be a buying opportunity.
However, since recession risks persist, one should not be blindly optimistic and thorough risk management is necessary.

5. Conclusion and Future Checkpoints

– Inflation and consumption stagnation coexist, and the market is entering a phase of maximized uncertainty.
– Attention needs to be paid to the phenomenon of discrepancy between actual economic indicators and perceived economic conditions (sentiment indicators).
– It is essential to check US economic indicators, consumer sentiment indicators, and major corporate performance in the second half of the year.
– It is necessary to continue tracking whether a recession occurs, changes in monetary policy, and global economic trends.

< Summary >
Inflation and consumption stagnation are progressing simultaneously due to the sharp drop in PPI, slowdown in retail sales, and Walmart's price increases. Despite the deterioration of soft data, there is room for a stock market rebound if a recession does not fully materialize. However, the economic risk due to rising prices and shrinking consumption still persists. Close attention to key indicators and global economic trends is necessary until the end of the year.

Key Economic News & Tesla’s Latest Trends: PPI, Trump Tariffs, Long-Term Investment Strategies, Complete Analysis of Tesla News

In this article, we summarize the following key economic issues at a glance:

Recently announced U.S. PPI (Producer Price Index) and future inflation prospects
Progress of Trump's tariff negotiations and changes in global trade flows
Tesla's institutional investment trends, stock price strategies, and tips for interpreting media noise
U.S. stock market rebound, long-term investment mindset, and timing issues
Tesla's internal and external issues: Shanghai factory sales/inventory, Texas bill, Musk's compensation plan
Trends in S-curve growth industries such as solar power, energy storage, and Optimus (robots)

If you read today's post until the end, you can grasp the latest global economy and Tesla market movements, and how to seize opportunities without being swayed by noise.

1. U.S. PPI Announcement: Inflation Signals and Market Expectations

The recently announced PPI (Producer Price Index) was much lower than market expectations.
Recorded the lowest level in the past 10 years.
PPI acts as a leading indicator compared to CPI (Consumer Price Index), signaling that inflation may decline more rapidly.
Federal Reserve Chairman Powell remains cautious about interest rate cuts, citing concerns about renewed inflation, but this figure increases the possibility of further CPI declines and, in the long term, increases pressure for interest rate cuts.
Delaying interest rate cuts carries the risk of economic slowdown.

2. Trump’s Tariff Strategy and the Global Trade Landscape

Trump mentioned unprecedented achievements in tariff negotiations with India. India proposed 0% tariffs on U.S. products.
The Indian Foreign Ministry emphasizes ongoing negotiations, but the possibility of additional trade benefits is high soon.
Major trade agreements with the UK, China, and India are expected to continue to drive the global stock market rally.

3. Tesla’s Institutional Investment Trends and Stock Price Outlook

According to Fintel data, the number of Tesla shares held by institutions recently reached an all-time high.
Renowned institutional research firms (such as JP Morgan) superficially lower their target prices → but are actively engaged in actual buying. It's necessary to separate market noise from actual investment behavior.
Instances where institutional forecasts and actions are inconsistent are frequent. Investors should consider both numerical changes and industry behavior.

4. Investment Timing vs. Long-Term Investment Strategy

Rather than trying to time the stock market rebound, long-term perspective sees both declines and rises as opportunities.
Many become interested after a rally, but historical data shows that bear markets and sideways markets have been buying opportunities in the long run.
U.S. stock market's long-term returns: although not easy to put into practice, cultivating a large mindset and blocking out noise are key.

5. Tesla Internal and External Issues – Production, Inventory, Media Noise

In the past, Tesla generated significant profits from the resale of leased vehicles. Value enhancement through software updates is also a key point.
The media often frames Tesla negatively. It's necessary to look at the facts coldly.
Shanghai Gigafactory's production and sales figures for April have been released. Almost all production is sold, maintaining inventory levels at a minimum.
Unique production and inventory structure within a quarter (inventory increases in the early to mid-quarter, concentrated sales at the end).

6. Texas Bill and Musk’s Compensation Plan

Texas specifies that corporate disputes within the state must be handled only in Texas courts. Elon Musk directly addresses the Tesla compensation issue.
Trend of relocating headquarters and corporations to Texas due to increased risks in Delaware corporations.
Action and reaction: pay attention to how companies respond to changes in the regulatory environment.

7. Growth of S-Curve Industries such as Solar Power, Energy Storage, and Robots, and Tesla

Solar panel installations are rapidly increasing, far exceeding the International Energy Agency (IEA) projections, a typical S-curve growth.
Tesla's energy storage system (ESS) sales: growing by a factor of 2 annually. Shanghai Megafactory begins full-scale operation.
S-curve industries break "conservative" forecasts and actually experience explosive growth.
Tesla is at the forefront of these industrial trends.

8. Evolution and Future Direction of Tesla’s Robot Optimus

Optimus successfully upgraded performance with software alone without changing the hardware. Developing a Gen model.
Tesla simultaneously enters several S-curve industries such as energy, robots, and electric vehicles.
Riding these S-curves in each field can lead to overwhelming performance in long-term investments. However, investors must have the skills to withstand intermediate volatility.

< Summary >

Economic indicators such as the U.S. PPI suggest the possibility of easing inflation.
Trump’s tariff negotiations raise expectations for changes in global trade flows.
Tesla’s institutional investment proportion shows discrepancies between actual behavior and forecasts.
Both U.S. stocks and Tesla remain attractive if viewed as long-term investments.
Focused analysis of Tesla’s production, inventory management, legal risk response, and preemption of S-curve industries.