Once playing, click the icon in the lower right corner for full screen. Focus should occur after a few seconds; if not, click the wheel to the left of the YouTube icon to adjust:
Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.
Here are some selected highlights of key global economic and market data, signals, trends, etc., from our internal log over the past few days.
Clients, if you'd like more color on any of the below, or anything else that went on in global markets/economics this past week (even if it's not featured below, there's a good chance I commented on it internally), please feel free to reach out.
Last Thursday 5/2 Generally speaking, it’s pretty clear that the market (equity mkt in particular) is pricing in a soft landing and strong go-forward corporate earnings growth.
Given that there are sufficient leading indicators to cause concern, the soft landing thesis continues to stand on shaky ground, which of course conflicts with that forward earnings bullishness.
Ironically, while my stated concern ultimately leads to consequently-lower equity prices, along the way to a harder-than-priced-in-landing, a notable rally in equities (classic “blowoff top” perhaps) is very much on the cards – as the economy/inflation cools.
Bottom line, the likely equity market transition for the no-soft-landing scenario sees stocks flat to down as long as inflation remains elevated… Then stocks rally as the economy and, thus, inflation cools… Then stocks finally rollover when recession becomes reality… Then a fundamentally-sound buying opportunity presents itself.
Clients, please be sure and take this one in when you have a few minutes.
Have a nice weekend!
Once playing, click the icon in the lower right corner for full screen. Focus should occur after a few seconds; if not, click the wheel to the left of the YouTube icon to adjust:
Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.
Here are some selected highlights of key global economic and market data, signals, trends, etc., from our internal log this past week.
Believe it or not, in a feeble attempt at brevity, I cut a ton out... So, clients, if you'd like more color on any of the below, or anything else that went on in global markets/economics this past week (even if it's not featured below, there's a good chance I commented on it internally), please feel free to reach out.
Well, I'm already breaking my own new rule, by publishing two blog posts on the same day... Can't resist it this morning... I.e., I don't want this one to get lost in the shuffle of next week's summary.
This morning's log entry:
4/27/2024
This from Grant Williams' podcast guest is, in essence, what I’ve been describing during client review meetings of late…
I.e., In terms of what he says about how policy will be implemented going forward, I couldn’t agree more!
I somehow failed to mention the market implications of next week's treasury quarterly refunding announcement... Before you click the play button, here’s from our internal notes:
4/23/2024
Next week’s QRA (the treasury’s quarterly refunding announcement) is likely to be big for markets.
If Yellen wants to concentrate go-forward issuance on the short end of the curve, that’s easy for the market to absorb and bullish for equities.
If, on the other hand, she signals that issuance will concentrate on the long-end (far more difficult for the market to absorb (i.e., yields higher), that’s bearish.
With regard to the TGA (treasury general account), if she sets a high target (i.e., much bond issuance proceeds get stuck in the TGA, as opposed to being spent in the economy), that’s bearish.
If she sets a relatively low target (i.e., more juice going into the economy), that’s bullish.
Her track record thus far – not to mention, incentives – leans heavily toward t-bill concentration and a lowish TGA target (i.e., she definitely wants to keep financial markets buoyant going forward)... Problem being, that would be economically-stimulative, which might problematically offset what would otherwise be hugely bullish (operative word their being “might”) for equities... I.e., a resilient economy means sticky inflation, and sticky inflation means no aggressive rate cutting over the next few months, which could be a real downer for equities going forward.
Nevertheless, if we're talking relatively light issuance (less than last quarter) focused on the short-end of the curve, and, again, a lowish TGA target, stocks are likely to, at least initially, rally on the news.
Once playing, click the icon in the lower right corner for full screen. Focus should occur after a few seconds; if not, click the wheel to the left of the YouTube icon to adjust:
Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.
Here are the latest highlights of key global economic and market signals, trends, etc., from our internal log... Be sure and peruse all the way to the end, as we highlight a broad range of topics.
4/19/2024
Equity futures, bonds, currencies, commodities all reacted aggressively to the initial news of Israel’s attack on a military base in Iran… As the dust settled it became clear that the attack was limited in scope – i.e., tit for tat – and, therefore, for the moment, not a market event… As I type, 7:04am, the S&P is flat, the Nasdaq’s off 56 bps, yields are down a bit, gold’s up 25 bps, the dollar’s down 21 bps and oil’s flat.
4/19/2024
The latest Fed Beige Book release (a view from each of the 12 districts) points to an economy that continues to expand, albeit at a snail's pace at this point, and a consumer who is, on balance, becoming more cautious on spending… Inflation signals are mixed, but, on balance, somewhat problematic for businesses as their pricing power now seems to be fleeting.
