The Fed has now made it clear they are cutting 25 basis points next week. While we have our reasons for favoring rate cuts, we have not heard a good argument articulated by the Fed. Is data dependency dead?
If the Fed listened to the market and started hiking several years ago, they would not be agonizing over cuts today.
Today's topics include money for nothing, wages vs. employment, hoping for ECB stimulus, coordinated global monetary policy, the Fed's inflection point, stock market valuations, small caps vs. large caps, the problem with stock picking, Mr. Market vs. PhDs and another Trump attack on the Fed.
Yesterday New York Fed President John Williams and Vice-Chairman Richard Clarida made dovish comments that the markets interpreted to mean a 50 basis point cut might be coming at the July meeting. The New York Fed tried to walk back these comments hours later.
Today's topics include interest rates as a relative value, earnings and Fed policy, Trump vs Powell, why Lagarde is a good pick for the ECB, municipal bond issuance, natural gas, Libra and abolishing the debt ceiling.
Despite the disbelief by many that the Fed will cut rates at the end of the month, economic data and inflation expectations actually make it a reasonable idea.
Today's topics include stock picking over the long run, active vs. passive, Chinese growth, measuring a bull market, betting on rates going lower, betting on rates going higher, Chinese buybacks, governments' opposition to Libra and the richest people in the world.
The last half hour of the trading day has proven very profitable for stock traders.
10-year yields have fallen during U.S. and Asian trading hours in 2019, but have chopped sideways during European trading.