The American consumer continues to make great economic strides, allowing them to flex their spending muscle and still have some restraint. Personal Income and Spending came in better than most of the consensus estimates, and yet, core inflation was only 0.1%.

Here’s the thing, according to the latest University of Michigan Sentiment read, consumers expect this to keep up for some time.

• Current conditions climbed to 115.5 from 111.6
• Expectations increased to 88.9 from 87.3

Meanwhile, five-year inflation expectations declined to an all-time low reading of 2.2%.  Jay Powell will be under a lot of pressure to make sure this happens.

By the way, only two percent of respondent mentioned “impeachment.”  Perhaps, the most compelling aspect of the report is rich folks are finally feeling better.  Respondents in households with the top one third of earners saw a 7.5% pop in positive sentiment. 

At midday, the major indices are up yet again. On the S&P 500, the sectors are mixed with 5 in the green, and 6 down slightly.  But the bigger message is that on the NYSE, there 237 new highs to 4 new lows.  On the Nasdaq there are 276 new highs to 38 new lows.  The up volume outpaces the down volume 1,822 to 1,079 on the NYSE, and 1,762 to 1,344 on the Nasdaq.