Don’t confuse your relatives with your absolutes 🤔

Plus a charted review of the macro crosscurrents 🔀

(Photo by Greg Jewett on Unsplash)

Stocks made new record highs, with the S&P 500 reaching a closing high of 4,958.61 and an intraday high of 4,975.29 on Friday. For the week, the S&P rose 1.4%. The index is now up 4% year to date and up 40% from its October 12, 2022 closing low of 3,577.03.

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Various aspects of the markets and the economy can be worse and good, simultaneously. They can also be both better and bad.

That’s because “worse” and “better” are relative terms, and “good” and “bad” are absolute terms.

Kind of like when you’re starting to recover from the flu. Maybe you feel better. But that doesn’t mean you feel good.

In the markets and the economy, this can get confusing when you consider developments in the various metrics investors follow.

For instance, size is an absolute. And the relative terms used to describe size include “growing” and “shrinking.”

But the concept of growth can also be considered an absolute. And relative terms like “accelerating” and “decelerating” describe it.