This is inflation week on the economic calendar. Or perhaps deflation. Not that inflation or deflation has been much of a presence in our financial lives of late. But fear of the twin beasts? That's a different story entirely. Worry over the two 'flations underlies much of the much debate that is pulling Washington apart.
The producer price index will be published at 8:30 a.m. Eastern on Tuesday, to be followed by the big one, the consumer price index, at 8:30 a.m. on Wednesday.
Otherwise, the week presents a potpourri of major reports that lack an overarching theme: Retail sales at 8:30 a.m. Tuesday, industrial production at 9:15 a.m. Wednesday, housing starts at 8:30 a.m. Thursday, and the Philadelphia Fed survey -- an avatar for manufacturing in general -- also on Thursday, at 10 a.m.
Leading indicators (in descending order of importance):
The interest rate spread between 10-year Treasuries and the federal funds rate, reported continually during market hours.
The M2 money supply, at 4:30 p.m. Thursday.
The S&P 500 index, reported continually during market hours.
Average weekly initial jobless claims, at 8:30 a.m. Thursday.
Building permits for new private homes from the housing starts report at 8:30 a.m. Thursday.
Index of consumer expectations from the Reuters/University of Michigan consumer sentiment report on Friday at 9:55 a.m.
Other reports of interest:
Tuesday: Empire State manufacturing survey of New York business at 8:30 a.m., and business inventories at 10 a.m.
Wednesday: The Treasury Department's international capital report, tracking flows of foreign money into and out of the United States at 9 a.m., the Home Builders' housing market index at 10 a.m., petroleum inventories at 10:30 a.m., and the Federal Reserve's Beige Book, a narrative of economic conditions in the central bank's 12 regions.
The big names in monetary policy are out in full force during the week, speechifying no doubt in the hope of edifying the public about their sometimes arcane work.
Federal Reserve Chairman Ben Bernanke speaks at the University of Michigan on Monday at 4:30 p.m.
Two other members of the Federal Open Market Committee are making appearances: San Francisco Fed Pres. John Williams on Monday and Atlanta Fed Pres. Dennis Lockhart on Monday and Thursday.
One FOMC alternate is speaking: Boston Fed Pres. Eric Rosengren on Tuesday.
I don't normally track Fedsters who don't current sit on the FOMC, but a few speakers are out there who routinely produce headlines, despite their lack of involvement in setting policy.
Minneapolis Fed Pres. Narayana Kocherlakota speaks Tuesday and Wednesday, Philadelphia Fed Pres. Charles Plosser on Tuesday, and Dallas Fed Pres. Richard Fisher on Wednesday
By my rules, as of Monday I'm using February options for the short legs of spreads and April options for single calls and puts and the long legs of spreads. Of course, shares are good at any time.