TMI Indicators: Commodity Sentiment Review - Restocking On, But China Macro Momentum May Have Peaked

TMI Snapshot: Fed Tapering Talk Surge - Our Data Says This Is More About Inflation Vs. Asset Bubbles

TMI Snapshot:  Financial Conditions, Wall Vs. Main & Biden Stimulus Via Text-Mining

Introducing TMI Data Science: Delivering Alpha With Custom NLP-Based Leading Indicators

Managing Director

Elan Gore

TMI Data Science

TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade & traditional media.  Our proprietary software, TMI Machine, is a text-mining platform designed with the buy-side & capital markets professional in mind, text-mining the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income & individual equities.  TMI provides custom leading indicators and systematic trading strategies, operating at the nexus of linguistics & statistics drawing on vast experience in investment banking and hedge fund settings in senior quantitative and fundamental roles.  

TMI Data Science was founded by Elan Gore, an award-winning Senior Global Basic Materials Equity Analyst & China Economist with 15 years of experience in North American hedge funds & institutional managers; and Alessandro Porrino, Ph.D., an Algorithmic Trading Analyst and Programmer with 10 years of front-office experience ranging from complex FX option pricing to auto-hedging strategies at Bank of America Merrill Lynch and Standard Chartered.  Mr. Gore holds an MBA in Finance from New York University Stern School of Business, and Mr. Porrino holds a Ph.D. in Systems Engineering from Brunel University London.

Macroeconomics

<ul>
<li>Breakevens have surged to their widest levels since H1 2019, implying more than merely a recovery to pre-pandemic levels</li>
<li>Our inflation expectations sentiment and diffusion indicators have also surged in November, but still remain well-below pre-pandemic levels, while interest in inflation hedges spiked sharply in the first week of December</li>
<li>Reports of a -35% decline in US rent collections in September led to concerns on US rent deflation, in light of the ~40% combined primary rent &amp; owners' equivalent rent weight in the core CPI; November reports suggest rent collection comps have improved to -27%, which may have helped supercharge the underlying inflation narrative</li>
<li>Even when taking into consideration USD weakness &amp; commodity recovery, breakevens appear to imply notable acceleration in US rent inflation in 2021 from multi-year lows to multi-year highs</li>
<li>While 2020 is unlike anything we've ever seen, the data suggests transmission from home price inflation to rent inflation is normally a multi-year process</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


Breakevens have surged to their widest levels since H1 2019, implying more than merely a recovery to pre-pandemic levels
Our inflation expectations sentiment and diffusion indicators have also surged in November, but still remain well-below pre-pandemic levels, while interest in inflation hedges spiked sharply in the first week of December
Reports of a -35% decline in US rent collections in September led to concerns on US rent deflation, in light of the ~40% combined primary rent &amp; owners' equivalent rent weight in the core CPI; November reports suggest rent collection comps have improved to -27%, which may have helped supercharge the underlying inflation narrative
Even when taking into consideration USD weakness &amp; commodity recovery, breakevens appear to imply notable acceleration in US rent inflation in 2021 from multi-year lows to multi-year highs
While 2020 is unlike anything we've ever seen, the data suggests transmission from home price inflation to rent inflation is normally a multi-year process
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Snapshot:  Update on Underlying Inflation Expectations from Our Text-Mined Indicators