The widely watched two-to-ten-year U.S. Treasury interest rate curve inverted briefly on Wednesday, and remains essentially flat as of this writing. The yield on the longest-dated Treasuries fell to all-time lows. The backdrop, we trust, is well-known to our readers: anxiety about trade wars, fears about slowing global growth, and Read more…
Executive Summary 1. Trade wars, geopolitics, and the fate of the yuan. Beneath the trade-war back-and-forth is a stark reality: the era of Chinas massive accumulation of foreign exchange reserves is ending, and in coming years, Chinas currency is likely headed for a significant decline. Saber rattling goes on as Read more…
The U.S. Economy and Market Why has the U.S. market had such a hard time while the U.S. economy and U.S. corporate profits are so strong? There are many ideas, but we believe the main causes of a weak U.S. market have been three: Trade fears; Fears that the U.S. Read more…
A volatile year to date seems to be resolving itself into a cautiously positive market backdrop, presenting the possibility of a better-than-usual summer for stocks. The underlying causes of volatility are still present — primarily the tug-of-war we have described several times, between rising interest rates (which are challenging for Read more…
Will Ramping Inflation Cause More Problems For Markets? The correction that began on January 30, and which may not yet be over, was triggered by several events. The fundamental events were first, the release of new data showing rising wages; and second, increasing acceleration in the rise of long-term interest Read more…
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