I do not think it is a stretch to write the ties that bind the global economy together and delivered goods in abundance across the world is unravelling at a remarkable pace. Today, Russia’s invasion and China’s COVID zero lockdowns are disrupting supply chains further pushing inflation to forty-year highs. War and plague, however, do … Read more
Covid in China, war in Europe and changing perceptions about the invincibility and massive ownership of Big Tech companies are reasons slated for the plunge in the NASDAQ. The five-day 8.3% plunge is even causing the most ardent large cap growth investor to question one’s rationale. Year to date the NASDAQ is down 20.2% and … Read more
Little attention has been focused upon surging mortgage rates. According to CNBC, the average 30-year mortgage rate is 4.72%, up 1.50% from the beginning of the year and 1.20% since mid-February. Around mid-October the yield was approximately 2.875%. Since the Federal Reserve announced a change in monetary policy, bids for mortgage-backed securities have almost disappeared. … Read more
Stocks climbed and bonds fell after FRB Chair Powell reassured markets that the Fed remains committed to fighting the fastest inflation in 40 years, despite uncertainties caused by the geopolitical turmoil. The Fed Chair backed a quarter point move this month to commence a series of increases and did not rule out a large move … Read more
It is widely suggested today’s bout of inflation is the result of the lack of supplies. There is a lack of workers, trucks and energy. In many regards it is self-induced. What happens if the logistic issues morph into production issues, an environment the country has not faced in about 85 years? Commenting about the … Read more
The massive rally that pushed gold to record heights about $2,000 an ounce came to a violent end yesterday as the metal had its biggest drop in seven years after bond yields spiked higher. The catalyst is an expected flood of government and corporate bond issuance amplified by a stronger reading than expected for US … Read more
Jobless claims surged by 6.64 million, vastly exceeding the 3.6 million estimate. In two weeks, the economy has lost over 10 million jobs, eclipsing the approximate 8.6 million jobs lost in the first seven months of the Great Recession. More are expected to come albeit maybe not at this level. Wow! This is really ugly. … Read more
I think during the next nine months fortunes can potentially be made and fortunes can be lost. Oil has been incredibly volatile in 2016, falling about 50% during the first 45 days of the year, advancing 85% in the next three months and then declining 22% in six weeks. As inferred above oil “officially” went … Read more
Equities extended their gains buoyed by improving Chinese data, better than expected earnings from a large money center bank and data that did not threaten the monetary policy. Stocks were also encouraged by the Beige Book—or the statistical compilation utilized at the upcoming Fed meeting—indicating the economy continued to expand from late February to early … Read more
Equities closed essentially unchanged as crude rallied about 1.7% to close over the psychological $40 mark. There were no major headlines for yesterday’s rise except a reiteration of next week’s OPEC/Russia meeting to cap production. The dollar fell to a nine month low. What I found of great significance, escaping the attention of most, was … Read more
