The global upheaval of the past several years has prompted economists and Wall Street to question many longstanding economic beliefs. But one belief that has yet to change is that long-run inflation will deviate much from 2%.
For the last few decades we have been in a low interest rate environment where deficit spending would not cause major issues. However, a 40-year high in inflation prompted the Fed to tighten monetary policy at a fast pace. Higher rates mean the cost of servicing U.S. debt will follow higher.
Tax receipts only cover 73% of federal spending as net interest costs are projected to rise.
Buybacks offer companies a way to increase shareholder value without issuing a taxable dividend. Buybacks areoften dominated by the largestweighted companies in the index.
Updating the changes in central banks' balance sheets
A Long-Term Look at Housing Starts
Some interesting charts from our recent posts
Today's topics include Timiraos highlights the FOMC minutes, quantifying the fiscal problem facing governments, more on the consumer's ability to spend, higher rates' effect on homeownership, and a rally for the most shorted stocks
What is the collective of US stocks less the Mag 7 doing this year? Underperforming cash for the second straight year.
Today's topics include when does QT go too far?, hedge fund concentration, getting out of cash, auto loan rejections at record, foreigners have ditched Chinese stocks, zooinks! zombies!, CalPERS strategy vs. 60/40 model portfolio, higher rates create expensive housing, expensive housing creates expensive rents, and office stocks rally with no outlook change