The Week Ahead

From an information perspective, we really don't get that much.

First, the markets are closed on Monday for President's day.

Wednesday we get two important stats. Housing starts and CPI. I'm especially curious about CPI in the wake of the import export price release last week that showed the highest rate of growth since 1982.

With any housing statistic, its more a matter of how bad will it be? I can't the the homebuilders doing any major buildouts right now.

As for the market, I'm waiting for one of the big averages to break out of the consolidation pattern we're in.

The Week Ahead

So -- what do we look for now that the Fed has announced it won't bail out stupidity but will bail out a slowing economy? The answer is pretty simply: signs of a slowing economy.

So - next week we have construction spending, ISM manufacturing and auto sales on Tuesday. All of these are important numbers.

The Redbook is on Wednesday. This might be more important than usual.

On Friday we get employment. This is the biggie. The primary argument from the bulls is the employment situation is a strong reason why the economy is doing well. That makes this number doubly important.

The Week Ahead

It's going to be a busy week:



A few points:

I've been critical of the retail sales numbers for the last two months because the official number did not jibe with the news on the ground. I was right regarding November's number, which was revised down. Now we'll see about December's number.

The NY Fed and Philly Fed numbers will be very important. Most of the Fed manufacturing districts had lower numbers in their latest report. In addition, the Chicago PMI has been decreasing for the last year and dropped below 50 in the latest survey. This also ties in with industrial production. Although it rose .4% in December the 4th quarter number was negative.

Housing starts -- let's see if the builders are going to continue to add to an already overbuilt situation.

PPI -- All of the Fed governors have warned on inflation in their latest public speeches. That makes this number perhaps a bit more important.

Bernanke address Congress on Wednesday.

The Week Ahead

Next week is a light data week. The international trade position comes out on Wednesday. I would expect this to drop a bit, especially as oil has dropped in price. The import/export price index comes out on Friday.

Finally, we get retail sales on Friday as well. This should be interesting. Last month's number raised eyebrows with its 1% gain. I was extremely skeptical of this number, largely because all of the other retail numbers that came out at that time were nowhere near that good. I'm curious to see if the Census Bureau lowers that number.

There have been a ton of large deals over the last few months that have fueled the market higher. If we see some more of this large M&A activity I would expect the market to continue higher. However, we'll be bumping up against the interest rate environment as the market moves higher.

The Week Ahead

The market is closed tomorrow for the President Ford funeral.

Wednesday we have Redbook and UBS store sales. I am especially interested in the retail numbers to see how Christmas was. Not what people were going to spend, but what they actually spent. This will be a read of the Christmas season. We also get December car sales and the ISM manufacturing index. And finally we get construction spending. This will be a big day.

Thursday we get the ISM service report and jobless claims. Look at the claims numbers to see if there is a bump in construction related losses.

Finally we get the employment situation on Friday. Again pay attention to construction employment. Also keep an eye on professional (real estate agents) and financial services (mortgage brokers). We've had two sub-prime brokers go belly-up in the last month.



In short -- we're going to get a ton of information this week.