Supra Week

AP: More Data on Housing, Spending This Week

This week's data on housing, retailers and labor costs will give Wall Street an idea of whether the economy is weakening or inflation is accelerating—or both.

The markets are angling for more rate cuts to stoke the economy, but what could tie the Fed's hands is inflation. High food, energy and healthcare costs are a reason consumers—particularly homeowners with tough-to-pay mortgages—are cutting back on discretionary spending.

"The worst of all possible worlds is stagflation"... Stagflation happens when the economy weakens at the same time prices are rising. It's a problem that can't be solved with rate moves; rate cuts spur inflation but boost growth, while hikes control inflation but also dampen growth.

This upcoming week is shaping up to be an indicator of what the near future may hold from the point of view of the economy and politics.

Which is it, a recession, inflation, or stagflation which is both a recession and inflation.

How the Stock Market will respond during this week is unclear. Its been trending upward recently, but there are several key reports which might send it down.

Super Tuesday will most likely shake out the Republican candidate, McCain. The Democratic candidacy may still be up for grabs except Obama is now according to some polls leading Hillary in California. That's a big deal.

Rasmussen

California: Obama 45% Clinton 44%

Georgia: Obama 52% Clinton 37%

Arizona: Clinton 46% Obama 41%

New York: Clinton 52% Obama 34%

Missouri: Clinton 47% Obama 38%

Basketball, now that's a sport.