We discussed inflation in our post yesterday. We referenced financial asset and real asset inflation. I’ve now seen the tweet below from multiple professionals I follow and feel it’s worth sharing here. The tweet references financial asset inflation in terms of hourly wages of the average US worker. It’s pretty crazy to see how many hours …
Category: Economics
Inflation Game Planning
Inflation is a phenomenon that impacts everyone. Granted inflation has been quite tame for the past 40 years, it hasn’t always been so. Inflation ramped up quite a bit in the 1970s as a result of various factors, the most famous being the oil embargo and rising oil prices. Beating the inflation of the 1970s …
The “R” Word
Economists have predicted nine of the past five recessions. If that statement doesn’t make sense to you or appears to be wrong, it’s meant to. The quote is attributed to Paul Samuelson, the first American to win the Nobel Prize in economics. The quip was meant to imply that economists aren’t very good at predicting …
Conflicting Signals?
Year-to-date, the S&P 500 is up about 11.5%. Over the same time period, interest rates, as measured by the U.S. Treasury 10-year yield, have declined nearly 13% to 2.47% (as of 3/22/19). This trend appears to be sending mixed signals as rates historically have increased when stocks were on the rise in a typical business …
Economic Growth and the Housing Market
Sluggish GDP growth has been a concern for the past 10 years, following the last recession. Many papers have been written and many opinions have been offered. Academic studies demonstrated that overhangs after financial crises can lead to below average economic growth for a number of years. Additionally, high debt levels relative to a country’s …
Recessions & the Stock Market
The Expert Who Cried Recession Lots of people have been talking about the next recession and it’s not even here yet (as far as we know). Most have been trying to read the tea leaves and project the year of commencement of the next recession…the second half of 2019, 2020, 2021, etc… In this day …
State of the Markets
Once again we find ourselves in a bizarre market environment with a lot of noise and very few signals. I feel like this is going to be the case for the foreseeable future. These types of environments are dangerous as many narratives surface that appeal to our innate desire to want to be able to …
CEO Confidence
Interesting chart plotting CEO confidence vs. the year-over-year percentage change in the S&P 500. This is interesting in conjunction with our post from earlier in the week plotting global CFO’s perceptions of major economies. Unless we see a turnaround in CEO confidence, looks like it could be another rough year for US markets.
Global Perceptions
A chart from Deloitte’s quarterly CFO survey courtesy of Axios Markets. Interesting to see the enthusiasm for growth conditions waning considerably in 2019. Also of interest, is the continuing decline in North American CFO’s perception of current growth (although it remains considerably higher than European and China counterparts.
Perspective
As a follow up to yesterday’s post, I wanted to direct readers to a write-up Ray Dalio posted on LinkedIn just after Christmas. As always, Mr. Dalio does a tremendous job of putting what’s happening in the real world into a meaningful perspective. I highly recommend everyone read it.