SCHX News and Press, Schwab U.S. Large-Cap From 02/02/23

Summary A big contributing factor to the surge in inflation was the spike in consumer spending. Healthy GDP growth, generationally low unemployment, and relatively stable earnings all point to a stable economy. While the future always remains unclear, nobody knows for certain whethe...

Summary The massive fiscal expansion during COVID and the Fed’s accommodation of that spending via QE is what caused the spike in prices over the last 18 months. Spending fell back and has essentially been trending sideways since. Credit spreads are still below average and in...

Summary The Fed's inflation fighting credibility is really on the line this year. The peak in inflation was mid-2022, and it's fallen a lot in the last six months and likely to keep falling. The long end of the yield curve is held in check to some extent by the Fed's stubbornness at...

Summary As of 30 Jan. 2023, an analytical model developed by an analyst at the U.S. Federal Reserve is signaling the probability the NBER will someday say the U.S. went into recession during 2023 is nearing 50%. Assuming the Fed follows through on hiking the Federal Funds Rate by anothe...

Summary Despite mounting evidence supporting recession forecasts, the stock market remains at odds with that outlook. Such leaves investors in a predicament of avoiding a further drawdown in the equity markets but not wanting to miss out on a potential recovery. History is exception...

Summary The most common definition of a recession is two or more consecutive quarters of negative growth in a nation’s GDP on an inflation adjusted basis (real GDP). It is common for bear markets to begin before recessions officially start as investors anticipate tougher economic...

Summary The Fed meets this week and is widely expected to raise the Fed Funds rate by 0.25% to a range of 4.5% - 4.75%. The 10-year and 2-year Treasury yields are essentially unchanged since late September as investors await more information about the economy. I think it is likely t...

Summary It is important to choose the right ETF for the current low-growth environment where there are also talks about a recession. For this purpose, I compare two of Schwab's ETFs, namely SCHG and SCHX. In this case, SCHX has better sector exposure and is also less concentrated in...

Summary While the economy continues to be relatively strong, there are several seemingly intractable problems on the horizon. Consumers are spending beyond their means and absent a sharp increase in real wages, this is likely to lead to a drop in spending once excess savings are consume...

Summary Yesterday’s weekly update on initial jobless claims suggests that the labor market will continue expanding. A pair of proprietary business-cycle indicators highlighted in the weekly updates of The US Business Cycle Research Report also show a modest contraction in progres...