A ‘fair-value’ estimate of the US 10-year Treasury yield was steady in April while the market level for the benchmark rate continued to rise well above the theoretical level. But trading activity this month suggests the trend may be shifting. Yesterday’s sharp fall in the 10-year yield (May 15) substantially narrowed the spread, which implies that the market’s premium over fair value had become extreme.
Category Archives: Uncategorized
Macro Briefing: 16 May 2024
* US stocks rally to record high after encouraging inflation data
* Americans unexpectedly paused spending in April vs. March
* US homebuilder sentiment in May weakens for first time in six months
* NY Manufacturing Index indicates slightly faster contraction in May
* US Core Consumer Inflation falls to 3-year low in April:
Guesstimating The Level Of Froth In US Stocks
Calling tops and bottoms in the stock market is the Holy Grail for investing analytics. Alas, success on this front is nearly impossible, at least in terms of timely precision. Yet some of us still venture down this path. Why? Developing perspective helps, even if it’s less than perfect perspective and it’s used judiciously and the caveats are recognized.
Macro Briefing: 15 May 2024
* Fed Chairman Powell says inflation has been higher he expected
* Is the Fed courting higher-inflation risk again? Yes, says economist
* US household debt rises to record, highlighting financial pressure on families
* Copper rises to record high
* BlackRock on track to run world’s largest bitcoin fund
* US wholesale inflation rises more than forecast in April:
Disinflation Expected To Resume In April CPI Report
US consumer inflation data was surprisingly firm in March, raising the stakes for tomorrow’s April report (Wed., May 15). Another round of disappointing numbers would arguably confirm that the recent disinflation trend is in serious trouble. No one can rule out that possibility, but I’m expecting we’ll see disinflation will return in some degree.
Macro Briefing: 14 May 2024
* 1-year-ahead consumer inflation expectations increase to 3.3%: NY Fed survey
* New US tariffs on China raise tensions with Beijing
* US regulators OK changes to ease transmission of renewable energy
* Home Depot’s Q1 revenue below expectations but earnings outperform
* US small business sentiment ticks up in April but remains below average:
Commodities And Stocks Are Driving Investment Returns In 2024
April was a rough month for global markets, but commodities and stocks are still the performance leaders for the major asset classes this year, based on a set of ETFs through Friday’s close (May 10).
Macro Briefing: 13 May 2024
* Biden expected to announce new tariffs on some Chinese goods
* Falling birthrates around the world is raising alarms
* Analysts forecast upbeat Q1 earnings results will continue in Q2
* China’s seizure of Taiwan’s TSMC would be ‘devastating’ for US, says official
* US Consumer Sentiment Index falls to 6-month low in May:
Book Bits: 11 May 2024
● The Quiet Coup: Neoliberalism and the Looting of America
Mehrsa Baradaran
Summary via publisher (W.W. Norton)
With the nation lurching from one crisis to the next, many Americans believe that something fundamental has gone wrong. Why aren’t college graduates able to achieve financial security? Why is government completely inept in the face of natural disasters? And why do pundits tell us that the economy is strong even though the majority of Americans can barely make ends meet? In The Quiet Coup, Mehrsa Baradaran, one of our leading public intellectuals, argues that the system is in fact rigged toward the powerful, though it wasn’t the work of evil puppet masters behind the curtain. Rather, the rigging was carried out by hundreds of (mostly) law-abiding lawyers, judges, regulators, policy makers, and lobbyists. Adherents of a market-centered doctrine called neoliberalism, these individuals, over the course of decades, worked to transform the nation—and succeeded.
Emerging Markets Corporates Are Upside Outlier For Global Bonds
Foreign fixed-income markets from a US investor perspective have been an unappealing asset class lately – with a glaring exception: corporate bonds in emerging markets. Year to date, this slice of global fixed-income securities is hot, based on a set of ETFs through Thursday’s close (May 9). The rest of the field is struggling.