DC Lite #233

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1. Jobless claims. Initial claims unexpectedly dropped by 12k to 216k (vs. 230k est), the lowest level since mid-May. Continuing claims also surprised to the downside, falling to 1,862k (vs. 1,890k est).

2. Disposable income. "Real disposable personal income per capita rose in September. This is the 27th straight monthly rise, the longest streak on record (data goes back to 1959). Overall real disposable personal income per capital is more than 2% above pre-pandemic forecasts."

3. Oil vs. liquidity. "The recent rise in G10 excess liquidity to a level it has only … eclipsed once is a very positive tailwind for crude prices."

4. Mutual fund cash levels. "Cash fell from 1.6% to 0.6% of AUM, over 5x the average monthly move of +/- 20bp. Cash is now in line with the lowest level in our data history since 2015."

5. CAPE ratio vs. returns. “We are at [a] value of around 36x today. When looking at historical data going all the way back to 1900, the forward 10-year return for the S&P 500 was negative 84% of the time at a 36x CAPE."