Commodities rallied last week, posting a fourth straight weekly gain. The rise led mostly positive returns for the major asset classes for the trading week through Apr. 23, based on a set of exchange traded funds.
Macro Briefing: 26 April 2021
* Key swing vote in Senate says he’ll back targeted version of infrastructure bill
* Fully vaccinated Americans can visit Europe Union this summer
* India’s Covid surge is ‘spreading like wildfire’
* Space junk: ticking time-bomb for vital satellites orbiting earth
* Options market prices in rising odds of 3%-plus US consumer inflation
* Wide-ranging increases in prices spur worry that global markets are in a bubble
* New US home sales rebounded sharply in March
* US economy ‘firing on all cylinders’ via Apr PMI survey data:
The ETF Portfolio Strategist: 25 April 2021
Proprietary Strategies
A rally across most global markets last week lifted all three of our proprietary strategies, which use the same 16-fund opportunity set that defines their benchmark.
Book Bits: 24 April 2021
Philippe Aghion, et al.
Review via The Economist
Joseph schumpeter thought capitalism was doomed. Incumbent firms would grow too powerful, leading to corruption and, eventually, socialism. His mid-20th-century pessimism has become fashionable today, as societies grapple with inequality, climate change and tech giants. Yet some of Schumpeter’s professional heirs are optimists. In “The Power of Creative Destruction” Philippe Aghion, Céline Antonin and Simon Bunel, three economists, apply his most powerful idea to contemporary debates in their discipline. The result is sweeping, authoritative and—for the times—strikingly upbeat.
The ETF Portfolio Strategist: 23 April 2021
In this issue:
- Commodities rally to six-year high
- US stocks are flat, breaking a four-week winning streak
- US Treasuries continue to recover
- Broad, global diversification continues to lead portfolio strategy benchmarks
Capturing Average Returns With Asset Allocation, Part III
In recent posts I looked at the power of asset allocation to capture average returns (or slightly better) and manage risk in portfolio design. Several tests show that this tool is robust for a variety of standard portfolio mixes. Let’s take the analysis up a notch by creating an ill-advised portfolio as a stress test.
Macro Briefing: 23 April 2021
* Biden seeks higher taxes on wealthy to pay for child care, education
* Russia orders troops to pullback from Ukraine border after buildup
* Eurozone economic growth picked up speed in April, survey data shows
* PMI survey data points to strong economic revival in Apr for UK
* Japan’s economy is growing again–first time in over a year via survey data
* US Leading Economic Index rose in March, signaling stronger momentum
* Existing US home sales fell for second straight month in March
* US jobless claims fell to new pandemic low last week:
Is The Rise In The 10-Year Treasury Rate Noise Or Signal?
If your historical perspective is defined the last several months, the recent jump in the benchmark 10-year Treasury rate looks significant. But a longer term view suggests otherwise. That will change if rates continue to rise, but at the moment the backup in yield still looks like one more installment of a long-running trend of fluctuation within a sliding trend.
Macro Briefing: 22 April 2021
* US reaches 200 million vaccinations–vaccinating the rest may be tougher
* German Foreign Minister: de-coupling from China would be a mistake
* India reports new world record for highest rise in daily Covid-19 infections
* Pfizer-BioNTech Covid vaccine scientist says third shot is needed
* Russia arrests 1000-plus people during protests supporting Alexei Navalny
* Biden will propose 50% cut in emissions cut for US by 2030
* Analysts consider the risk of a US housing market crash
* 10-year Treasury yield down for second day, near lowest rate in over a month:
The ETF Portfolio Strategist: 21 April 2021
The 10-year Treasury yield ticked down for a second day, settling at 1.57% (Apr. 21). That’s close to the lowest rate in over a month. If the 10-year rate closes lower on Friday vs. the week-ago yield, the slide will mark the third straight weekly decline.