Retail sales increased 0.4% in June, which is below the consensus forecast, but that shortfall is less about a weaker pace of spending vs. overly optimistic expectations among economists for this morning’s number. In any case, don’t pay too much attention to one number, particularly one that has little relevance for assessing the broader macro picture. On the other hand, take note that the year-over-year trend in retail spending inched higher for the third month in a row, offering another clue for thinking that business cycle risk remains low.
Daily Archives: July 15, 2013
US Industrial Production: June 2013 Preview
Tomorrow’s report on industrial production for June is projected to post a 0.2% gain vs. the previous month, based on The Capital Spectator’s average econometric forecast. The expected increase represents a modest improvement vs. the unchanged reading for the previously reported May figure. Meanwhile, the Capital Spectator’s average projection for June is in the middle of expectations relative to three consensus forecasts based on surveys of economists.
What Should We Expect For Long Run Risk Premiums?
If you built a portfolio with a market-value weighted mix of all the major asset classes, what risk premium would you expect? I’m looking for a 5.2% return, give or take. To be more precise, my current equilibrium-based forecast of total return (less the risk-free rate) for the Global Market Index (GMI) is 5.2% these days.