As is my usual practice, this will be my last commentary for the year barring big news (and most "news" isn't, especially that of the market variety). While I won't be writing for the next month, that doesn't mean I won't be working. I use the month of December to catch up on my research reading (books and academic papers) [...]
As we enter the final quarter of 2024, there are a lot of questions facing investors. There are, of course, always a lot of questions because investors are always dealing with the future, but today's environment does seems to have more than usual. Some of these questions concern short-term considerations and while they are important, it is more important to [...]
What do you get when the Central Bank lowers interest rates by 50 basis points in a good economy? Just what we've seen since this happened on September 18, a surge in commodities. Is your portfolio diversified? Ebbs and flows in the market can sneak up on us and today's markets react quickly and sometimes violently. Did you see the [...]
Well, they did it. The Fed cut the Fed Funds rate by 50 basis points last week and indicated that there is likely more to come. Stock investors liked it, bidding up small cap stocks (S&P 600) by 2.25%, large caps (S&P 500) by 1.4%, and the NASDAQ by 1.5%. Most other markets also did as expected with emerging market [...]
It's Fed week again, when the monetary mandarins gather to set interest rates and guide the economy according to the latest 3-year plan (central planning may not have worked for the communists but our people are smarter). This is a quarterly meeting when they'll sift through the tea leaves or gaze into their crystal balls or whatever they do to [...]
You're going to hear a lot of talk about the yield curve soon and what it means for "the" yield curve to uninvert (which isn't a real word but will get used a lot). The difference between the 10-year Treasury note yield and the 2-year Treasury note yield is about to turn positive, the 2-year note yield recently falling a [...]
Overall, the economy continues to grow at a solid pace. But the inflation and labor market data show an evolving situation. The upside risks to inflation have diminished. And the downside risks to employment have increased. As we highlighted in our last FOMC statement, we are attentive to the risks to both sides of our dual mandate. The time has [...]
I can calculate the movements of the heavenly bodies but not the madness of people. - Sir Isaac Newton, upon losing a fortune on South Sea Company stock Newton's Laws of Motion An object at rest remains at rest, and an object in motion remains in motion at constant speed and in a straight line unless acted on by an [...]
The Senior Loan Officer Survey came out yesterday and I'm sure you've been waiting on pins and needles, as I have, to see the results. Okay, maybe you had better things to do. I sure hope so because it isn't exactly riveting. Here's the description from the Fed's website: Survey of up to eighty large domestic banks and twenty-four U.S. [...]
What a difference a day makes! After a two-week correction of nearly 5%, the S&P 500 spent the first part of last week rallying in anticipation of a friendly Fed meeting. That Fed meeting Wednesday produced the expected, namely that a rate cut in September was likely. That pushed the S&P 500 up over 2% from the Fed meeting to [...]
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