<Click on graphic for larger image> Comment Our colleague in Switzerland made the following comment on the chart above: Peter Lynch, legendary manager of the Fidelity Magellen fund during the 1980s, once said, “If you spend more than 13 minutes analyzing economic and market forecasts, you’ve wasted 10 minutes.” His was a time before index-tracking ETFs,… Continue reading Central Bank Balance Sheets And Markets
<Click on graphic for larger image> <Click on table for larger image> Comment The CNN poll in the table above shows Trump leads among likely voters. However, it also shows Clinton with a three point lead among registered voters. Over the same period of time (August 29 to Sept 4) the NBC/SM poll shows a large 6 point Clinton lead… Continue reading Election Update
Bloomberg Business – Narayana Kocherlakota: One Word Could Be Worth a Million Jobs Supporting a strong job market is a big part of the U.S. Federal Reserve’s mandate. Fed officials, though, interpret that goal differently than most observers do. For the economy’s sake, Congress should step in to resolve the discrepancy. Specifically, the Federal Reserve Act instructs… Continue reading Fed Policy And The Unemployment Rate
<Click on chart for larger image> Comment The green bars above show the market’s track record in predicting FOMC hikes/cuts over the last 86 meetings since Bernanke and Yellen were in charge. Note that within 10 days of a meeting, the market has correctly predicted the outcome of all 86 meetings since 2006. The blue… Continue reading Gauging The Odds Of A Fed Hike
<Click on chart for larger image> The Wall Street Journal – Gasoline Glut Threatens a Crude-Oil Rally Fueled by Car Travel Surging demand from drivers in the richest countries helped power a big rally in crude this year. But many analysts say that surge is ending. In the U.S., lower gasoline prices led consumers to drive a… Continue reading Gasoline Demand
The Financial Times – Banks: Too dull to fail? Regulators have pushed the sector to behave more like utilities, but similarities only go so far The applause was faint when Neel Kashkari, the influential president of the Minneapolis Federal Reserve, addressed Washington DC’s Brookings Institution in February. Little wonder. A shocked audience had heard Mr Kashkari,… Continue reading Bank Regulation
The Wall Street Journal – U.K. Loses Interest-Rates Derivatives Crown to U.S. Britain accounted for 39% of the global trade, while U.S. share rose to 41% in Bank for International Settlements survey London has lost its dominant position in the global market for interest rate derivatives to the U.S., according to data on a market with… Continue reading Interest Rate Derivatives
<Click on chart for larger image> CNBC – Negative rates will stay for another five years, JPMorgan warns Equity valuations between Japanese and European banks will converge with quantitative easing (QE) programs and negative interest rate policies set to continue for the long term, according to a team at JPMorgan. “QE reduces lending rates to… Continue reading Negative Rates
<Click on graphic for larger image> Bloomberg Business – Bond Investors Gearing Up for ECB Look for Flatter Yield Curve Yield spread between 10- and 30-year bunds has narrowed Government-bond bulls are keeping their expectations high before the European Central Bank’s meeting this week. Investors strengthened bets that yields on longer-dated securities will fall relative to those… Continue reading Bull-Flattening Before ECB Meeting
<Click on graphic for larger image> MarketWatch.com – Pressure mounts on ECB to do QE3, but Thursday is seen as close call Will they or won’t they? Extend the European Central Bank’s quantitative easing program, that is. Investors are becoming increasingly convinced the ECB will prolong its asset-buying program beyond March 2017, but the big question is… Continue reading More QE For The ECB?
<Click on graphic for larger image> <Click on graphic for larger image> AQA- Ben Breitholz: S&P 500 and USTs – Historically Low Volatility The S&P 500’s 30-day standard deviation of daily returns (0.3%) has sunk to its lowest levels since October 1968 and January 1994. A combination of markets failing to believe rates hikes are on… Continue reading S&P 500 And USTs – Historically Low Volatility
<Click on graphic for larger image> The Wall Street Journal – Investors See Danger as Global Assets Get Pricey Rich valuations, lagging fundamentals cause concerns; U.S. stocks are up even as profits have fallen The fate of a broad 2016 rally that has lifted the prices of everything from American stocks to emerging markets likely will hinge… Continue reading Scary Talk