In a series of articles I’ve looked at alternatives to the standard 60/40 stock/bond benchmark using mostly US securities (see links below). Let’s add another flavor to the analysis using a portfolio of China stocks and bonds.
Author Archives: James Picerno
Macro Briefing: 7 April 2022
* Ukraine asks NATO for more weapons as Russia regroups for new attacks
* Treasury Sec. warns of ‘enormous’ economic repercussions from war in Ukraine
* China warns US against House Speaker Pelosi visiting Taiwan
* Fed officials decide to shrink balance sheet soon, minutes indicate
* Fed funds futures pricing in relatively high odds of 50-basis-point rate hikes
* Big oil bosses say there’s no quick fix to oil shortage
* Senate expected to confirm Jackson to Supreme Court today
* Russia appears to default on its debt after payments made in roubles
* Global economic activity slowed in March via Composite PMI, a GDP proxy:
S&P 500 Risk Profile: 6 April 2022
The US stock market remains on the defensive, but it’s not yet obvious that the threat of an extended downside run is imminent. Nonetheless, there’s a case for a cautious stance. The main risk factor, of course, is the ongoing war in Ukraine and the uncertainty that it poses to markets and the global economy. Elevated inflation and an increasingly hawkish Federal Reserve add to the potential for trouble.
Macro Briefing: 6 April 2022
* Russian military pounds Ukrainian cities as the West prepares more sanctions
* Treasury Sec. Yellen set to warn of economic blowback from Ukraine war
* Can Germany end its dependency on Russian gas? It’ll try, but it won’t be easy
* Fed’s Brainard says central bank may soon begin ‘rapid’ balance-sheet reduction
* 30-year fixed mortgage above 5% for first time since 2011
* China services sector activity fell at sharp pace in March, PMI survey shows
* US Q1 GDP growth nowcast remains weak via Atlanta Fed’s GDPNow model
* US services sector growth picked up in March via ISM Services Index:
Will The Strong Jobs Market Keep US Out Of Recession?
Recession forecasts are topical lately, driven by the recent inversion of the Treasury yield curve for 2- and 10-year rates. But some economists see a strong labor market as a key factor that will keep the expansion alive.
Macro Briefing: 5 April 2022
* US stops Russian government from paying holders of its sovereign deb
* Ukraine war boosts shift to renewable energy as fossil fuel demand rises
* Recession forecasts are on the rise, but the economy is strong
* US jobs market is tightest since World War II, estimates Goldman Sachs
* China’s struggle with surging Covid-19 cases focuses on Shanghai
* Eurozone growth was strong in March as inflation surged
* US factory orders fell in February–first monthly loss since April 2021:
Risk Premia Forecasts: Major Asset Classes | 4 April 2022
The expected risk premium for the Global Market Index ticked slightly higher in March to an annualized 5.8% pace, fractionally above last month’s estimate.
Macro Briefing: 4 April 2022
* Reports of war crimes by Russia emerge in Ukraine war
* JPMorgan CEO says inflation, Ukraine war ‘dramatically increase risks’ for US
* Why is US population growth rapidly slowing?
* Global mfg growth slows to 18-month low in March via PMI survey data
* Fed funds futures pricing in high probability of 50-basis-point rate hike in May
* US payrolls continue to rise at strong pace in March
* US 2yr/10yr Treasury yield curve turns negative for first time since 2019:
Book Bits: 2 April 2022
Juliette Kayyem
Interview with author via Lawfare
We live in a time of seemingly constant catastrophes, and we always seem a step behind and still fumble when they occur. It’s no longer about preventing disasters from occurring, but learning how to use the tools at our disposal to minimize the consequences when they inevitably do.
Juliette Kayyem has just written a book about it all called, “The Devil Never Sleeps: Learning to Live in an Age of Disasters.” Juliette is a lecturer at the Harvard Kennedy School of Government and a CNN national security analyst, and David Priess sat down with her to talk about it all.
Major Asset Classes | March 2022 | Performance Review
Commodities continued to top monthly returns for the major asset classes in March. The leadership marks the third straight month that raw materials outperformed the rest of the field by a wide margin, based on a set of proxy ETFs.