Inflation is no longer accelerating, but it’s not showing clear signs of declining from recent peaks either.
Macro Briefing: 14 October 2021
* Gas shortage expected to force power plants to switch to oil
* US home heating costs projected to rise sharply this winter, federal gov’t advises
* Fed minutes: ‘gradual tapering process’ could start as early as mid-November
* Flatter 30yr-5yr Treasury yield curve suggests recession risk is rising
* Foreclosures surging as Covid mortgage bailouts expire
* China’s factory-gate prices soared to a near-26-year high in September
* Chinese developers shut out of global debt markets after Evergrande crisis
* Turkish currency at record low after president fires central bankers
* US headline consumer inflation ticked up to 5.4% annual rate in September:
10-Year Treasury Yield ‘Fair Value’ Estimate: 13 October 2021
Last month’s estimate of “fair value” for the US 10-year Treasury yield suggested that an upside bias for this benchmark rate was likely, or at least plausible. A month later, that outlook turned out to be spot on. Today’s update still suggests that more upside for the 10-year rate is still a reasonable view.
Macro Briefing: 13 October 2021
* House votes to raise the US borrowing limit through December
* IMF cuts US and global economic growth estimates for 2021
* Global supply chain bottlenecks could “get worse before they get better”
* US will open borders with Canada and Mexico to vaccinated travelers
* China’s export growth was surprisingly strong in September
* UK economy continued recovering in August
* Eurozone industrial output fell in August amid supply constraints, slower growth
* US small business sentiment ticked lower in Sep, well below recent peak
* US workers quit their jobs at record pace in August:
Fossil Fuel Stocks Are On Fire This Year
Alternative energy may be the future, but the past isn’t dead yet.
Macro Briefing: 12 October 2021
* House set to vote on US debt-limit increase approved by Senate last week
* Global tax deal in doubt in US over obscure legal issue
* JPMorgan’s Dimon predicts supply-chain issues for economy will ease soon
* China’s financial sector under increased scrutiny from government
* India faces rising risk of an energy crisis
* Iran reportedly hacked US and Israeli defense tech companies, says Microsoft
* South Korea’s central bank holds rates steady but signals hike in November
* Three US economists share Nobel prize in economics
* US oil price benchmark tops $80/barrel for the first time since 2018:
Commodities Topped Returns For Major Asset Classes Last Week
Amid ongoing concerns over inflation, commodities continued to rise, posting the strongest gain for an otherwise mixed week for global markets through Oct. 8, based on a set of ETFs.
Macro Briefing: 11 October 2021
* Global rebound at risk from supply bottlenecks, rising energy prices and inflation
* Congress faces a challenging autumn as crucial legislation awaits approval
* China property bonds tumble as default worries lurk over industry
* Inflation threat rises as energy prices increase
* Analysts predict that the recent surge in corporate earnings has peaked
* America’s port crisis, born of supply chain disruption, shows no sign of easing
* US payrolls didn’t surge in September as jobless benefits were cut
* US companies added fewer jobs than expected in Sep, close to Aug’s gain:
Book Bits: 9 October 2021
Stanley McChrystal and Anna Butrico
Summary via publisher (Penguin Random House)
Retired four-star general Stan McChrystal has lived a life associated with the deadly risks of combat. From his first day at West Point, to his years in Afghanistan, to his efforts helping business leaders navigate a global pandemic, McChrystal has seen how individuals and organizations fail to mitigate risk. Why? Because they focus on the probability of something happening instead of the interface by which it can be managed. In this new book, General McChrystal offers a battle-tested system for detecting and responding to risk. Instead of defining risk as a force to predict, McChrystal and coauthor Anna Butrico show that there are in fact ten dimensions of control we can adjust at any given time. By closely monitoring these controls, we can maintain a healthy Risk Immune System that allows us to effectively anticipate, identify, analyze, and act upon the ever-present possibility that things will not go as planned.
The ETF Portfolio Strategist: 8 October 2021
- Commodities deliver a winning weekly performance
- All but one of our portfolio benchmarks rose this week
Playing a hot hand in commodities: Broadly defined commodities rose for a third straight week through today’s close (Friday, Oct. 8), posting the strongest weekly within our 16-fund opportunity set that spans the globe and major asset classes. For details on all the strategies and metrics in the tables, see this summary.