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Munis Expected to Weather Extreme Risk-on Condition

October 23, 2017

Summary Investors in municipal bonds have been hit with headlines of overbought conditions. However the potential for an abrupt rise in U.S. Treasuries does not seem likely given lagging hard economic and inflation data. Municipal bonds are expected to remain moderately in the black into early 2018. Comment Reward-to-risk ratios across major asset classes calculated… Continue reading Munis Expected to Weather Extreme Risk-on Condition

Newsclips

Bank of Canada Likely to Pause

October 23, 2017

Bloomberg – Retail Drop, Subdued Inflation Put Bank of Canada Rates on Hold Statistics Canada reported Friday retail sales declined 0.3 percent in August, versus a median forecast of a 0.5 percent gain. They also showed that excluding a jump in gasoline, inflation was little changed in September. The two indicators are the last of any significance… Continue reading Bank of Canada Likely to Pause

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Newsclips

Q3 Earnings Results, Financials Dissappoint

October 23, 2017

The New York Times – A Big Week for Earnings, and an Estimate for Economic Growth Big technology companies will flood investors with their latest progress reports on Thursday, when Microsoft, Amazon, Twitter and Alphabet, the parent company of Google, all plan to release their quarterly earnings. While there’s growing negative chatter about the power of these companies and their influence… Continue reading Q3 Earnings Results, Financials Dissappoint

Newsclips

All Quiet On The Stock Market Front

October 23, 2017

ZeroHedge – After 16 Months Without a 5% Market Pullback, Goldman’s Clients Want To Know Just One Thing Thursday marked the 30-year anniversary of Black Monday. On October 19, 1987, the S&P 500 plunged by 22%, its worst single-day return on record. Following the decline in global equity markets, it took the S&P 500 a full… Continue reading All Quiet On The Stock Market Front

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Newsclips

Who Owns U.S. Debt?

October 23, 2017

The Wall Street Journal – Global Investors Chase Safety, Yield in U.S. Bonds U.S. borrowing needs and demand for the debt have increased amid steady central bank support While the U.S. economy has yet to return to rates of growth seen before the financial crisis, the U.S. bond market has been a magnet for global savings.… Continue reading Who Owns U.S. Debt?

Newsclips

The Race For Fed Chair

October 23, 2017

Bloomberg Markets – Bond Traders Wrestle With Two Extremes for the Fed in Powell and Taylor Trump steered toward Powell, Taylor; could pair them up at Fed That choice — between Stanford University economist John Taylor and Fed Board Governor Jerome Powell — has the potential to jolt the bond market in a year defined by low… Continue reading The Race For Fed Chair

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Newsclips

Crude Oil Rig Counts

October 23, 2017

Bloomberg.com – Oil Patch Gets Frugal as Investors Urge Profits Over Boom Baker Hughes misses estimates, Schlumberger just matches them Rigs drilling for crude in the Permian drop most in 19 months U.S. shale drillers are tapping on the brakes in the wake of a growing investor revolt that’s held down company values, even as they’ve… Continue reading Crude Oil Rig Counts

Newsclips

The Taylor Rule

October 23, 2017

Bloomberg View – Charles Lieberman: Taylor Is Questioning His Own Rule A candidate to be Fed chairman recently acknowledged that circumstances might cause the Fed to deviate from the guidelines’ prescriptions. The oddest objection to the rule was raised by Taylor himself. After making his case for implementation, he acknowledged that assorted circumstances might provide… Continue reading The Taylor Rule

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Newsclips

The Fed’s Role In Financial Stability

October 23, 2017

The Wall Street Journal – Justin Lahart: Enough About the Economy; What Will the Next Fed Chief Do About Stocks? If the low-inflation environment prompts the Federal Reserve to keep rates low as well, asset prices could soar to dangerous levels. With the Federal Reserve likely to be under new leadership next year, investors are asking… Continue reading The Fed’s Role In Financial Stability

Newsclips

The ECB Taper

October 23, 2017

The Wall Street Journal – ECB Taper Promises to Set Off Ripples Across Many Markets What happens in the eurozone doesn’t always stay in the eurozone. On Thursday, the European Central Bank is expected to begin unwinding its extraordinary monetary stimulus, a process that will drag central banks from Ivory Coast to Switzerland in its… Continue reading The ECB Taper

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Newsclips

China’s Minsky Moment

October 23, 2017

The Financial Times – China’s warning of a ‘Minsky moment’ should not be ignored What exactly is the Chinese for “Minsky moment”? The chances are that we will soon need to know, after a startling moment of clarity from the outgoing chairman of the People’s Bank of China. Speaking on the sidelines of the Communist party… Continue reading China’s Minsky Moment

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Active vs. Passive Investing

October 23, 2017

Barron’s – Will Index Funds Share the Nifty 50’s Fate? Royce Funds’ veteran portfolio manager Boniface Zaino recalls that a prior period of “one decision” stock-picking didn’t turn out so well. And he has been in it for a while. Passive investing reminds the 74-year-old Zaino of the “one decision” approach that investors used more than… Continue reading Active vs. Passive Investing