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Investors are concerned about the impact the latest wave of Covid in China will have on the global supply chain. The greatest impact will be on China's economic growth in the second quarter, but stimulus should follow. U.S. multinationals seem to be effectively navigating this lat...
The Census Bureau’s latest advanced estimates for March trade show wholesale inventories jumped again, another 2.3% month-over-month during March. And that was on top of a slightly higher revised estimate for February. March’s wholesale inventories figure of 2.3% was the...
The Fed has little control over today’s goods inflation, driven by supply-chain, COVID stimulus, and war. Every time the Fed has increased rates to fight inflation historically, unemployment has increased. Recent events have put an even greater spotlight on energy independe...
Stocks fell earlier this week for the same reasons they’ve been falling all year: high inflation, the Federal Reserve’s attempt to cool it, and Russia’s invasion of Ukraine. About 90% of S&P 500 stocks fell on Tuesday. Money rushed to safe havens, such as Trea...
The S&P 500 and the US government bond index are now down about 12% from their highs (similar to Canada’s treasury bond index). Of course, Treasuries have guaranteed income payments and maturity dates, while stocks have none. In recent years, global equities have had an...
Ideally, we’d have a highly liquid NGDP futures market. Unfortunately, we are still in the Stone Age of macroeconomics. The stance of monetary policy is not a single number; it’s a vector. The simplest explanation for what’s going on is that the Fed is gradual...
Recovery from the COVID-19 recession has been characterized by resilient demand amid a series of supply disruptions. If inflation proves more persistent, more aggressive monetary policy tightening would be necessary, which restrains demand. The steep rise in global food and fuel p...
Analyst consensus estimates now put the net income of S&P 500 companies as a whole at 4.3% year-on-year growth in Q1. But with inflation running at a 7.9% pace, that means that in real terms, earnings growth is now negative. Strip out the effect of the spike in the energy sector's...
The market was unable to hold support on the pullback from the 4637SPX high. This has opened the door to test the 4000SPX region. It also seems as though the great majority of the market is prepared for a bear market. But, that is not how markets really work. For further det...
As investors seek safety in the US Dollar, this may eventually trigger a broader and deeper selloff in U.S. stocks and market volatility will begin to pick up as the VIXY moves up. The US Dollar is continuing to appreciate as investors and central banks seek safety from geopolitical, ...