E-piphany – The Fed Needs More Inflation Nerds And even if inflation expectations do rise further, the excuse from the chair will be easy: expectations are rising because the end (and possible reversal) of the globalization dividend and the imposition of tariffs will lead to higher prices. But there is nothing that Fed policy can do… Continue reading Inflation Rising, However Markets Remain Mostly Unconcerned
<Click on chart for larger image> Comment The chart above shows the probably of a Fed hike at tomorrow’s meeting stands at just 15%. The first story below is an opinion piece about the Fed from former Fed Governor Kevin Warsh. If we have learned anything about President Trump this past week or two, it… Continue reading The FOMC Meeting Starts Today
<Click on chart for larger image> Bloomberg View – Scott Dorf: The Stalemate Breaks This Week for Bond Traders … So, while the bears lumbered into 2017 emboldened like never before, the “real money” investors took a “too-much, too-soon” stance. JPMorgan Chase & Co.’s weekly investor sentiment largely echoed Stone & McCarthy’s, showing no significant movement in… Continue reading Bond Market Sentiment
<Click on graphic for larger image> The Financial Times – Gavyn Davies: What the models say about Dow 20,000 … Investors are an emotional crowd, especially when US equities, measured by either the Dow Jones Industrial Average or the more accurate S&P 500 index, have just hit all-time highs. I am not sure who first remarked… Continue reading Differing Views About The Stock Market
The Financial Times – Trump’s top trade adviser accuses Germany of currency exploitation Berlin using neighbours and US and is an obstacle to deal with EU, says Navarro Germany is using a “grossly undervalued” euro to “exploit” the US and its EU partners, Donald Trump’s top trade adviser has said in comments that are likely… Continue reading An Undervalued Euro?
<Click on graphic for larger image> CNBC – Trump shows up in 1 in 5 corporate earnings conference calls If you follow the news, it may seem like President Donald Trump is everywhere. Now he is appearing somewhere else: in public company earnings. Trump has shown up in 32 S&P 500 companies’ quarterly earnings conference calls… Continue reading Talking Trump
The Financial Times – Trend-following funds need to find their footing in 2017 Despite a weaker showing last year, computer-driven momentum strategies drew inflows Computer-powered, trend-chasing hedge funds sucked in billions of dollars last year, at a time when investors yanked money out of even the industry’s most lustrous names. Unfortunately, their performance was pretty dismal.… Continue reading Algos Running The World
The Wall Street Journal – The Rally’s Next Test: Can Earnings Keep Up With Stock Prices? A flurry of profit reports this week, including from Apple and Facebook, will help determine whether U.S. indexes can sustain their record run A slew of corporate earnings this week along with signals about the health of the broader economy… Continue reading An Earnings Update
<Click on graphic for larger image> The Wall Street Journal – Markets’ Postelection Calm Is Eerie and Historic The CBOE Volatility Index, or VIX, is at historic levels of complacency, a possible warning for investors Stop me if you’ve heard this before: We may be experiencing the calm before the storm for markets. By one measure,… Continue reading Record Bets on Low Volatility and Growth Stock Out-performance
<Click on graphic for larger image> Barron’s – Next Stop, Dow 30,000 The DJIA looks strong as it passes 20,000. History suggests that this aging bull market can live on. The Dow hitting 20,000 was no fluke. Today’s stock prices are well supported by solid prospects for corporate earnings and economic growth. In fact, if… Continue reading Forget Dow 20k, All Eyes On Dow 30k
Barron’s – A Skeptic’s View of the Trump Rally Dreyfus Global Real Return manager sees stocks falling 40% or more once long-term trends reassert themselves. Amid all the hype about the stock market’s gains following the U.S. presidential election, Suzanne Hutchins has remained unmoved. The 50-year-old lead manager of London-based Dreyfus Global Real Retur n mutual… Continue reading Where Are Stocks Heading?