The Sight of Central Bankers Naked in The Rain

Withholding tax collections have weakened in July, breaking down from the narrow range of 5-6% annual nominal growth they have been in through the second quarter.  The usual pattern in the past several years had been a cycle lasting 3-4 months. A cycle low is due now and the numbers have strengthened over the past 4 days. Whether the sharp break of the previous 3 weeks means anything will depend on how far this rebound progresses over the next couple of weeks.

The break in the tax data and the weakening of stock prices this week may have much deeper implications which could shed light on why the US Treasury has built a massive rainy day fund, with nearly 4 times the cash it usually holds. Download this report to view the evidence and conclusions about the implications of the data.

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Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also provide analysis and charts for David Stockman's Contra Corner which I developed for Mr. Stockman. I’ve had a wide variety of finance related jobs in the past 44 years, including a stint on Wall Street in both analytical and sales capacities. Prior to starting the Wall Street Examiner I worked as a commercial real estate appraiser in Florida for 15 years. I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. My perspective is not of the Ivory Tower. It is from having my boots on the ground and in the trenches of the industries that I analyze and write about today. 

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