Today's topics include vanishing yields & rising equity risk premia, what will the fed discuss at next week's meeting?, stimulus talks continue, corporate insiders are selling, top heavy market, projecting the EU's bond Issuance, reaching for yield, and Judy Shelton & Chris Waller one step closer to a Fed seat
Despite a massive rally in stocks since the March low, traders flocked to corporate, high yield, and aggregate bond funds in the second quarter.
Even if a vaccine or cure is immediately found, economies around the world are not likely to return to normal immediately. The economic damage is done, the public's psyche has been shattered, and it will take time to recover. We would argue traders understand this, which is one of many reasons central bank and government stimulus are impacting the markets more than vaccine rumors.
Today's topics include governments borrowing 70% more during pandemic, central bank bond purchases vs. issuance, EU strikes deal on €750 billion fiscal package, new gold highs?, negotiations continue on unemployment benefits, Jeff Bezos made $13 billion yesterday, former IMF director argues against negative rates, comparing stock and corporate bond valuations, Judy Shelton moves one step closer to Fed seat, and public transportation still feeling the effect of coronavirus
A replay of our July 23, 2020 conference call
Q2 2020 earnings season is underway. Analysts continue to forecast a 40%+ decline. Many financial firms reported last week. Even with record trading profits, their earnings were 50% lower versus a year ago.
Today's topics include shifting betas, risk asset seasonality, the Fed vs. the PBOC, the debate over inflation targeting, a history of FOMO, bank trading revenues, gauging the size of China's economy via the big mac index, and Bernanke & Yellen: blame hedge funds.
Elon Musk has rapidly moved up the list of the world's richest people.
Three-year forward earnings estimates may deviate far from reality around recessions, but a 3-year forward PE ratio may make more sense when attempting to gauge where valuations may be after the pandemic.