N. Korea says it reserves the right to shoot down US bombers: Reuters
Chicago Fed Index reflects slower US growth in August: Chicago Fed
Growth rate in Texas manufacturing sector remains strong in Sep: Dallas Fed
Fed’s Evans says rates should be held steady until inflation heats up: MNI
NY Fed’s Dudley expects import prices will boost US inflation: MarketWatch
Latest Obamacare repeal bill appears doomed: Politico
Demographic trend is keeping interest rates low: San Francisco Fed
Brent oil rises to 2-year high: BBC

Equities in foreign developed markets delivered the strongest gain last week for the major asset classes, based on a set of exchange-traded products. The modest advance marked the sixth increase in as many weeks for these markets.
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Merkel wins 4th term as German chancellor: Reuters
Yellen and Cohn are considered the frontrunners to lead Fed: NY Times
US business inflation outlook unchanged at 1.9% in September: Atlanta Fed
Dollar-denominated debt obligations outside US continues to rise: Bloomberg
The battle over Obamacare may never end: FiveThirtyEight
Japan’s government says country’s moderate recovery continues: RTT
US Composite PMI points to “strong” growth in September: IHS Markit

The Sep. 24 edition of The US Business Cycle Risk Report has been published and emailed to subscribers.

● A First-Class Catastrophe: The Road to Black Monday, the Worst Day in Wall Street History
By Diana B. Henriques
Interview with author via WYNC
The 1987 financial crash is considered to be the worst day on Wall Street. In her book, A First-Class Catastrophe: The Road to Black Monday, the Worst Day in Wall Street History, Diana Henriques looks at how “Black Monday” was really seven years in the making. She writes that this was due to missed opportunities, market delusions and destructive actions that stretched from the “silver crisis” of 1980 to turf battles in Washington.
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The Financial Times observes that the Federal Reserve’s forecast for higher interest rates in the next several years is accompanied by expectations of slower economic growth and rising unemployment. Given the tendency for US recessions to coincide or closely follow periods of tighter monetary policy, it’s hard to ignore the potential for trouble down the road.
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Trump orders more sanctions on North Korea: The Hill
Will North Korea test an H-bomb in the Pacific? Bloomberg
US Leading Index rises again in Aug, signaling growth ahead: Conf. Board
US jobless claims fell sharply last week: Reuters
Philly Fed Mfg. Index increases to 3-month high in September: MarketWatch
US FHFA House Price Index up 6.3% y-o-y in July: Builder
Unless research inputs are continuously raised, growth will slow: VoxEU

The inability of the crowd to earn anything close to Mr. Market’s performance is a hardy perennial. Although replicating market betas via low-cost index products has become child’s play, the persistent failure by most investors on this front is striking, as a recent study by Dalbar reminds.
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Fed leaves rates unchanged and OKs unwinding of balance sheet: CNBC
Major US equity indexes are mixed after Fed announcement: RTT
US existing home sales fall in August to lowest level in a year: HousingWire
Another effort to kill Obamacare scheduled for vote next week: Reuters
SEC’s computer system was hacked last year: NY Times
Most Fed officials expect more rate hikes: Federal Reserve

Recent hurricanes have taken a bite out of US economic momentum, but the trend is only battered rather than broken. Surveying a broad set of indicators still points to moderate growth for the near term. Recession risk, in short, remains low for the US, based on the numbers published to date.
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