Just when it looked like inflation’s threat was fading, yesterday’s August report on consumer prices dispensed a not-so-fast alert. The core reading of the Consumer Price Index (CPI), which excludes food and energy, rose 0.3% last month and accelerated to a 2.4% annual pace – the highest in 11 years. One data point isn’t a trend, of course. But yesterday’s release is conspicuous at a time when the US economy is struggling with slow growth and expectations that interest rates are headed lower, perhaps turning negative at some point.

Continue reading →

Biden attacks Warren, Sanders over price tag of healthcare plans: Reuters
ECB rolls out new stimulus plan to fight Europe’s economic slowdown CNBC
China expands exemptions to US goods subject to tariffs: Bloomberg
Trump: an interim trade deal with China is a possibility: CNBC
US budget deficit rises above $1 trillion for first time in 7 years: WSJ
Is the US facing a recession or slow growth? NY Times
US jobless claims fell to 5-month low last week: MW
US core consumer inflation’s annual pace accelerated to 11yr high in Aug: CNBC

Risk management has become a high priority for many investors over the past decade. The worst financial crisis and recession since the Great Depression in 2008-2009 clearly has the power to focus minds. Research shops have moved heaven and earth to search for solutions that attempt to limit risk without sacrificing return. The question is whether simplicity is competitive in this quest? As a preliminary investigation, consider a humble strategy that toggles back and forth between two BlackRock asset allocation ETFs.
Continue reading →

Trump delays China tariffs ahead of trade talks: BBC
Supreme Court OKs new asylum restrictions: CNN
European Central Bank expected to roll out new stimulus plan: CNBC
A new refugee crisis for Europe may be lurking: NY Times
US exported more oil than Saudi Arabia in June: Bloomberg
US wholesale inflation ticked up to relatively subdued +1.8% in Aug: MW
Eurozone industrial output fell more than expected in July: FT

Economic growth has slowed and there’s no sign that output will reaccelerate any time soon. But there’s also minimal evidence that the economy is due to crumble in next month’s third-quarter GDP report. Instead, the macro trend continues to plod along at a subdued pace.

Continue reading →

Trump abruptly fires Bolton, national security adviser: The Hill
No change in median US household income in 2018: WSJ
China exempts tariffs on select list of US goods: Axios
Some US firms cancelling China investments at faster rate: CNBC
California passes bill to require contractors be treated as employees: NY Times
US small business optimism still upbeat in Aug, but outlook looks challenged: NFIB
US job openings remain elevated but continue to trend lower in July: CNBC

The world economy appears to be slowing, with some analysts warning that recession risk is rising. Judging by year-to-date equity performances for the planet’s main economic regions, however, suggests that the crowd isn’t particularly worried.

Continue reading →

UK Parliament suspended as end-game for Brexit looms: CNBC
UK Prime Minister Johnson vows not to delay Brexit: Reuters
N. Korea fires projectiles after offering more talks with US: Time
Germany’s 30yr bond yield briefly rises above 0%: Reuters
States are ramping up investigations into Google and Facebook: Wired
US consumer borrowing in July posted the biggest gain since 2017: CNBC
US debt appears a lot higher than generally recognized: CNBC
US recession risk appears low, but contraction may be near anyway: MW
Factory deflation in China signals accelerating slowdown: Bloomberg

Stock markets in emerging markets continued to rebound last week, posting the strongest gain for the major asset classes, based on a set of exchange-traded funds. No mean feat, considering that nearly every slice of global markets rallied during the trading week through Friday, Sep. 6.

Continue reading →

Typhoon strikes Japan, leaving nearly 1 million households without power: CNN
Nearly 1,500 deaths in France attributed to summer heat: BBC
US job growth was weaker than expected in August: CNBC
UK economy grew faster than expected in July: Reuters
Is China’s economic slowdown worse than official data suggest? WSJ
China’s gold reserves rose a strong 5% in August: FXStreet
Will a manufacturing recession prevent Trump’s re-election? Bloomberg
The ‘Volfefe index’ tracks influence of Trump’s tweets on bond market: CNBC
VIX Index, the US stock market “fear gauge,” fell to lowest print since July on Friday: