A relief rally lifted most markets around the globe for the trading week through Friday, June 24, based on a set of ETF proxies. The question is whether the recovery is sustainable or just a bounce within an ongoing bear market for risk assets?
Author Archives: James Picerno
Macro Briefing: 27 June 2022
* G-7 leaders reaffirm their commitment to Ukraine and…
* Plan new sanctions on Russia including ban on Russian gold imports
* US economy will slow in 2022-23 but “narrowly avoid recession,” IMF predicts
* Russia defaults on its foreign debt for first time since 1918
* Central banks should act decisively to tame inflation, BIS advises
* Prominent crypto hedge fund at risk of default to repay $670 million
* Industrial metals prices set for the worst quarter since 2008 financial crisis
* Revised US consumer sentiment data confirms sharpe slide in June
* New US home sales rose in May — first monthly gain this year:
Book Bits: 25 June 2022
David Roediger
Summary via publisher (Haymarket Books)
The Sinking Middle Class challenges the “save the middle class” rhetoric that dominates our political imagination. The slogan misleads us regarding class, nation, and race. Talk of middle class salvation reinforces myths holding that the US is a providentially middle class nation. Implicitly white, the middle class becomes viewed as unheard amidst supposed concerns for racial justice and for the poor. Roediger shows how little the US has been a middle class nation. The term seldom appeared in US writing before 1900. Many white Americans were self-employed, but this social experience separated them from the contemporary middle class of today, overwhelmingly employed and surveilled. Today’s highly unequal US hardly qualifies as sustaining the middle class.
Recession Risk Rises But US Still Expected To Grow In Q2
Headwinds for US growth continue to strengthen, but next month’s second-quarter report of GDP is still on track to post a gain, based on the median estimate from a set of nowcasts compiled by CapitaSpectator.com. The question is whether the data deteriorates further between now and the July 28 Q2 release from the Bureau of Economic Analysis? Recent releases suggest that’s strong, or at least rising possibility.
Macro Briefing: 24 June 2022
* EU leaders offer Ukraine and Moldova candidate member status
* Recession risks for US and Europe have picked up sharply, warn economists
* China and India become Russia’s financiers to evade sanctions
* Copper, an economic bellwether, falls to 16-month low
* KC Fed Mfg Index shows further growth slowdown in June
* A $100 million crypto hack reported by Horizon, a so-called blockchain bridge
* US Energy Secretary asks oil firms to combat high gasoline prices
* US economic growth slows sharply in June via PMI survey data:
Peak Inflation Watch: 23 June 2022
The question of when inflation will peak consumes financial and commodity markets, and with good reason. When pricing pressure finally ebbs, the pressure on rate hikes and the headwinds for the economy will ease, if only on the margins. But every thousand-mile journey has to start somewhere.
Macro Briefing: 23 June 2022
* Powell tells Congress Fed is “strongly committed” to fighting inflation
* Powell returns to Capitol Hill today for testimony as rates stay in focus
* European leaders set to accept Ukraine as candidate to join EU
* Eurozone growth slows to 16-month low in June as demand weakens
* Germany lifts level of alarm over Russia gas disruption
* UK growth unchanged at 15-month low in June via PMI survey data
* US 10-year Treasury yield eases to 3.16%, lowest in nearly two weeks:
Macro Briefing: 22 June 2022
* Tensions rising between Moscow and NATO over Russia’s Kaliningrad enclave
* Japan on high alert amid activity by Chinese and Russian warships near its coast
* IEA warns Europe to prepare for total shutdown of Russian gas exports
* Russia earns more oil revenue than before war due to China and India
* Biden expected to call for 3-month suspension of gas tax
* Fed expected to lift rates by 3/4 percentage point again in July
* UK inflation ticks up to new 40-year high: +9.1% annual pace in May
* Existing home sales in US fell for fourth straight month in May
* US growth slowed in May via Chicago Fed business-cycle index:
Monitoring Fed Policy Expectations With The 2-Year Treasury Yield
Markets-based forecasts aren’t flawless, but for some projects in finance these estimates are the baseline estimates that are often tough to beat. An example is monitoring the outlook for trends and changes in Fed monetary policy. On that front, you could do a lot worse than keeping a close eye on the 2-year Treasury yield.
Macro Briefing: 21 June 2022
* European Central Bank plans two rate hikes this summer
* Goldman Sachs raises US recession-risk probability to 30% for 2023
* China’s economy continues to face downside risks
* Fed’s rate hikes are starting to slow borrowing and spending
* Israel’s gov’t collapses, new elections set
* New US ban on imports from the China’s Xinjiang region has started
* German 10-year yield rebounds to highest since 2014:
