1. B A WHILE YOU ARE WAITING WHICH TEAPOT HOLDS MORE TEA?
TEAPOT A – BUT WHY?
Because the amount is determined by the height of the spout and teapot B’s spout in about ½ the height of A’s
Actually teapot B holds about half!

2. WHAT CAN I SAY!!!

3. WELL OF COURSE – ESPECIALLY CONGRESS!!!!
CHART OF THE DAY
ARE PUBLIC JOBS MORE STABLE?
WELL OF COURSE – ESPECIALLY CONGRESS!!!!
Source: FRED

4. BIGFOOT INVESTMENTS - OPEN FORUM
Jun 15, 2017
WELCOME!
Volume #295

5. AGENDA WELCOME! QUOTE OF THE DAY AQR – Jake Ashley SWAPS AND SPREADS
OPTIMISM GAUGE
DIAGNOSTICS GAGE
FED NOTES/TRACKER
SUM AND SUBSTANCE
HIGH IMPACT
WEEKLY INTELLIGENCE
GLOBAL PERSPECTIVE
DAVID’S CORNER
ADVISOR INPUT
QUESTIONS/COMMENTS

6. If it wasn’t for breaking news….
“QUOTE” OF THE DAY:
If it wasn’t for breaking news….
….we wouldn’t be broken!
Anonymous

7. JAKE ASHLEY FROM AQR

26. Optimism Gauge
As of: 6/15/2017

27. >50-day MA/>100-Day MA
Change
Measuring Our Economy
Last Update: 6/15/2017
Weekly Updates
New Monthly Updates
Indicator
Current Value
Prior/Metric Value
St Louis Fed Financial Stress Index
(Rev)
+1.0
Chicago Fed National Act Index (3 Mon M/A)
+0.23
(Rev)
+.50
Unemployment
4.3% (May)
4.4% (Apr)
+2.00
Weekly Jobless Claims (4Wk Mov Av)
243,000
242,000
-.50
ECRI Weekly Index (Against 52 Wk Av)
144.5
143.5 (Rev)
Conf Board Leading Indicators (NEW)
126.9
126.5
University of Michigan Sentiment – Final
97.1 (Final – May 2017)
97.0 (Final – Apr 2017)
Monthly Retail Sales – ex Autos (Adjusted)
377,126 (May -2017)
378,103 (Apr-2017) Rev
NFIB Small Business Sentiment
104.5 (May -2017)
104.5 (Apr -2017)
ISM Manufacturing
54.9 (Expansion Line = 50)
54.8
Economic Capacity Utilization
76.6%
76.7% (Rev)
Stock Market Moving Averages
Weekly Data Points
>50-day MA/>100-Day MA
N/A
S&P Case-Shiller 20 City Comp Index (YoY)
5.9% (Mar)
5.9% (Feb) (Rev)

28. Economic Optimism Index
Measuring our Economy 10 20 30 40 50 60 70 80 90
100
Economic Optimism Index
Current:
Prior:
91.75%
READING AS OF: 6/15/2017
Current Reading:
91.75%
Trend: Negative
Prior Reading:
92.29 (Rev)
Bias: Positive

29. Week of: Jun 12th, 2017 BigFoot Investments
Market Diagnostics
Week of: Jun 12th, 2017
BigFoot Investments

30. SENTIMENT INDICATORS Week of Jun 12th - 2017
1. AAII Investor Survey
2. TSP Sentiment Survey
3. NAAIM Survey of Manager Sentiment
4. CBOE Volatility Index
INTERNAL INDICATORS
5. S&P D MA and 200D MA AND 2/10 MA
6. NYSE Bullish %
7. S&P 500 Bullish % ($BPSPX)
8. Percent of NYSE stocks above 200DMA
9. Percent of NYSE stocks above 10WMA
or 50DMA ($NYA50R)
10. NYSE 52-Week New Highs and New Lows
11. Percent of S&P500 stocks above 200DMA
12. Percent of S&P500 stocks above 50DMA
ADDED INDICATORS
13. Option Sentiment
14. Option Buyers Sentiment Gauge (OBSG)
15. Consumer Sentiment Index
16. Nasdaq Sentiment Index
17. Rydex Nova/Ursa Sentiment Indicator

31. Week of Jun 12th, 2017
29.41%
Prior: 29.41%

32. READY, SET …..HIKE! FOMC MEETING/RATE DECISION MEMBER DISTRICT TOPIC
VOTING MEMBER
MEMBER
DISTRICT
TOPIC
LINK TO SOURCE
FOMC MEETING/RATE DECISION

33. THE FED STRIKES - ECONOMY
Source: Federal Reserve

34. THE FED STRIKES - RATES Source: Federal Reserve
Average of Central Tendency: 2.90
Average of Central Tendency: 2.95
Average of Central Tendency: 2.5
Average of Central Tendency: 2.90
Average of Central Tendency: 2.85
Average of Central Tendency: 2.25
Average of Central Tendency: 1.5
Average of Central Tendency: 1.35
Source: Federal Reserve

35. THE FED STRIKES: BALANCE SHEET
Committee intends to gradually reduce the Federal Reserve's securities holdings by decreasing its reinvestment of the principal payments it receives from securities held in the System Open Market Account
Such payments will be reinvested only to the extent that they exceed gradually rising caps
For funds received from maturing Treasury securities, the Committee anticipates that the cap will be $6 billion per month initially and will increase in steps of $6 billion at three-month intervals over 12 months until it reaches $30 billion per month
For payments received from holdings of agency debt and mortgage-backed securities, the cap will be $4 billion per month initially and will increase in steps of $4 billion at three-month intervals over 12 months until it reaches $20 billion per month.
Caps will remain in place once they reach their respective maximums
Changing the target range for the federal funds rate is its primary means of adjusting the stance of monetary policy
All subject to change if there is a material deterioration in the economic outlook
Dropped language: “until the normalization of the level of the FDFD is well under way” (Translated: they want to get going)
Source: Federal Reserve

36. Implied 60bp (2 hikes) over next 12 months
TWO VIEWS
Now: 47.8
Previous: 48%
Implied 60bp (2 hikes) over next 12 months
Source: CME; Federal Reserve

37. Credit Anticipates-Equity Confirms
Swaps and Spreads
Rate
Prior
Current
Status*
Libor/OIS
0.29
0.34
Euribor/Eonia
-0.044
-0.027
Markit CDX NA - IG Spread
60.02
58.77
Markit CDX NA- HY Index
107.70
107.72
DTCC Repo - MBS
0.940
1.067
DTCC Repo – Treasury
0.938
1.075
High Yield
3.72
3.70
Fed Reserve Currency Swaps-Short
35(ECB)
0(BOJ)
40 (ECB)
0 (BOJ)
Fed Reserve Currency Swaps-Long
2-Year Swap Spread
0.198
0.154
TED Spread
0.204
0.244
As of: 6/14/2017 COB
*Note: Status = No major impact
Status = Moving Worse
Status = Negative Impact

38. ANOTHER SPREAD TO WATCH

39. SUM
SUBSTANCE

40. Industrial Production
THE BOTTOM LINE
Sentiment
Inflation
Industrial Production
Manufacturing
Output

41. WEEKLY MACRO DATA
THERE WAS NO DOT?!

42. STILL SOME MEANINGFUL DIFFERENCES
FED: 2.2
3.2
FROM 3.0
JUNE 14
Source: Atlanta Fed; New York Fed

43. NO CHANGE…STILL A RECORD LEVEL
-59 percent, reported hiring or trying to hire in May, although 51 percent said they found few or no qualified workers
104.5
Source: NFIB

44. NOT SO HOT
Source: BLS

45. THAT’S NO GOOD!
-0.3%
Source: Census Bureau

46. AND NEITHER IS THIS???
Source: BLS

47. PUSHING THE INFLATION STRING
Source: BLS

48. WELL OK THAT’S ENOUGH
Forecast: M
Actual: M
Source: EIA;

49. EMPIRE STRONG – PHILLY HANGS IN
Source: New York Fed; Philly Fed

50. NO ACTION
Source: Federal Reserve G.17

51. INTELLIGENCE
Risks Factors

52. COMPRESSION FACTOR

53. VERY QUIET
Source:

54. LOADING UP ON CHEAP MONEY

55. SAME GIG

56. OVERALL: DATA POINTS STATUS Comments Sentiment CPI PPI Output
Still relatively high although declines
CPI
Weak
PPI
Output
Industrial Production
Still expanding
Manufacturing
Slowing
Retail Sales
Seems forever weak
Interest Rates
Changes on the horizon – wait and see

57. THE GLOBAL CHURN ECB Rate Decision Eurozone China CRITERIA SCORE
Deficient
0-1
Poor
2-4
Satisfactory
5-7
Good
8-9
Excellent 10

58. DRAGHI SPEAKS

59. ECB NOTES – CONFLICTING TO SAY THE LEAST
Kept policy rates and QE unchanged but changed forward guidance on policy rates: No longer expects rates to go to “lower levels.”
Policy rates “to remain at their present levels for an extended period of time, and well past the horizon of the net asset purchases.”
Continued to have an easing bias on QE but stands ready to increase if necessary
Despite lowering forecast inflation rates, implied that deflation risks have disappeared
Risks to economic outlook “broadly balanced.”
ECB needs to be patient to see in price pressures materialize!
Source: ECB; Danske Bank

60. HOPE IS NOT A STRATEGY

61. HAPPIER
8.0
Source: ZEW; Trading Economics

62. HOLDING
7.0

63. 0.200
U.S. Macro
0.100
Last
New

64. ANOTHER VERSION
Source: Goldman Sachs

65. DAVID’S CORNER

66. ADVISOR INPUTS

67. QUESTIONS & COMMENTS
THANKS FOR JOINING US!

68. IMPORTANT DISCLOSURE INFORMATION
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69. WHAT WE WOULD BUY AT THIS LEVEL
REASON
STRATEGY THOUGHTS