DC Lite #182

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1. CPI (III). "Excluding shelter, the headline and core inflation rates were only 1.8% and 1.7% y/y in July."

2. VIX vs. IG spreads. "IG spreads are lagging the big drop in the VIX."

3. Rapid VIX retreat. At 16.2, today’s close marked “the index's fastest retreat from closing above 35 to below 17.6 (long-term median reading). Historically, it has taken 170 sessions to get there.”

4. SPW vs. SPX. "Based on the current equity risk premium, the equal weighted S&P 500 should trade at a premium to the S&P 500 and should trade at a 12% premium to the Russell 2000, all else equal."

5. EPS consensus growth. "While Q2 earnings results were stronger than expected, consensus now expects S&P 500 EPS growth of just 5.4% y/y in Q3, down from the July 10 est of 7.6%. The following few quarters also saw revisions lower, and this was true for large- and small-cap companies."