More From Surbhi Jain
Labor Market Slack Impacts Prices and Wages
If the unemployment gap is declining and the participation gap is rising, it could be due to an increase in labor market slack.
US Retail Sales Flat in April on Rising Oil Prices, Yet XRT Up 1%
Retail sales in the United States in April didn’t see any growth over March’s sales figures. But the jobless claims reading brought some positive news for the consumer sector.
Why the Dallas Fed report shows manufacturing continues to recover
The Dallas Fed conducts a monthly survey of manufacturers in Texas regarding their operations in the state to come out with the production index and the business activity index.
Why market reactions to the China-Vietnam tensions are mixed
Though the recent tensions in the South China Sea seem to have gathered much attention, the markets don’t seem to have factored in the conflict.
Overview: The thin line between frontier and emerging markets
Going to frontier markets offers more of an opportunity to discover the most overlooked companies.
Why Do Central Bankers Continue to Surprise Bill Gross?
In his recent webcast by Janus Capital, Bill Gross expressed his surprise at the extent to which central bankers of the developed world (EFA) (VEA) have distorted the financial system.
Will We See a Recession within the Next 2 Years?
In a recent interview, Jim Rogers said, “I’m on record as saying that we’re going to have a recession certainly within a year or two.”
Assessing the currency debate surrounding the Scottish referendum
If the Scottish referendum votes yes on September 18, it would mean that Scotland would become independent of the United Kingdom. One key issue that would arise from that would be currency. There are three lines of thought in this regard.
Why low inflation in the US shows that resources are being wasted
The speech took an interesting turn when Kocherlakota questioned his audience on they should care that inflation is too low.
Must-know: Investing in Ireland
Considering the improving and strengthening economic situation in Ireland, its Finance Minister Michael Noonan has said taxpayers could save up to $500 million per year if the state was able to pay-off a share of the International Monetary Fund (or IMF) portion of the $90 billion bailout.
Credit Suisse and Barclays Are Bullish on European Equity for 2016
Credit Suisse (CS) strategists forecast 10% earnings growth in Europe versus a 6.8% growth expected from the US.
US Industrial Production Data Disappoint Investors
Data indicated that industrial production edged down by 0.17% in May. So far, the industrial production index has declined in four out of five months this year.
Eurozone Retail Activity Dipped In June, HEDJ Down 2.32%
The Eurozone’s Retail PMI (purchasing managers’ index) dipped to 50.4 in June from the 51.4 recorded in May.
Why the rate cut may fuel the housing bubble in Canada
The Bank of Canada cut its key interest rate. Although the rate cut intends to boost the economy, it’s also fueling the housing bubble.
Germany Helps Eurozone Business Activity Rise in August
Both the manufacturing and service sector contributed positively to business activity growth in Germany in August.
US and China avoid contentious issues at the APEC meeting
Both China and the US decided to steer clear of more contentious issues at the meeting. Accordingly, the disputes over Hong Kong and cyber space were not even brought up.
Declining commodity prices drag the loonie down
Declining commodity prices directly impact export revenues and affect the top line for Canadian firms operating in the energy sector.
A declining ruble exacerbates Russia’s banking woes
Limited access to international capital and inflating external debts are just some of Russia’s banking woes.
The Redbook shows strength in retail sales due to a late Easter
The Redbook showed some strength in same-store sales during the April 19 week by recording a year-on-year rate of +3.7%.
Why Scotland wants independence despite the advantages of the UK
The United Kingdom (or UK) has sunk an awfully long way since the 19th century. But it remains the world’s sixth-largest economy and the second-largest in Europe behind Germany.
Global and Equity Market Risks Are Hovering over 2016
In 2015 many firms in the US (IWM) inflated their earnings and assets, as cheap credit was available.
June Oil Price Rebound Affects Auto Companies and Retail Sales
The SPDR S&P Retail ETF (XRT) shed 0.42% on July 14 as retail sales figures in the United States came in way below expectations.
Why monetary policy’s still abnormal as the FOMC nears its target
While addressing the Tennessee Bankers Association’s annual meeting in Palm Beach, Florida, on June 9, 2014, James Bullard explained how the FOMC is moving closer to its target while monetary policy still maintains a distance from its objective.
Why Brazil’s central bank is making a hawkish move on the Selic
On October 29, the central bank’s monetary policy committee in Brazil raised the benchmark Selic interest rate by 25 basis points to 11.25%. The increase was an attempt to fight inflation.
Once Again, Soros Makes Money off the UK’s Woes
Four days before the UK (EWU) decided to leave the European Union (VGK), Soros warned the markets of a “Black Friday” and a crash in the pound.
Overview: Shinzo Abe’s Abenomics
Abenomics is an effort to pull the world’s third biggest economy, Japan, out of two decades of stagnation by expanding the money supply, freeing up regulations, and encouraging the yen to fall.
Must-know: Investor expectations and key jobs reports
On Friday, April 4, the U.S. Labor Department released its Employment Situation Summary report for March. The Consensus forecast for Friday’s jobs number was 206,000.
Russian banks try to recapitalize due to low international reserves
The Bank of Russia has been digging into reserves in an attempt to defend the depreciating currency. These reserves shrunk by about 20% this year.
Crimea, annexed – Is Mariupol next for Russia?
The artillery barrage in Mariupol could mean Russia is preparing to launch an offensive that would secure its hold on Crimea.
Where Are Interest Rates Going? Ray Dalio Weighs In
Ray Dalio, and Marketplace Morning Report host David Brancaccio discussed the future of the economy and the next recession. Here’s what you need to know.
Saudi Arabia Enters International Bond Market, Raises $17.5 Billion
On October 20, the government of Saudi Arabia raised about $17.5 billion in an international bond issuance, marking the emerging market’s first foray into the international bond market.
Comparing ETNs with ETFs: The must-know pros of ETNs
ETNs are free of tracking errors, and investors can defer taxation until they mature or are sold.
Chinese Yuan Will Benefit from Being a Reserve Currency
The monetary authority in China (FXI) (YINN) worked to get greater international recognition for the yuan. There are benefits to being a reserve currency.
Must-know: Dividends as a hedge against stock market bubbles
Dividends pay returns even during market recovery. Major market indices like the S&P 500 (SPY), Dow Jones (DIA) and NASDAQ (QQQ) can be seen surging to record highs during a bubble.
Why the S&P 500 Net Profit Margin May Predict a US Recession
Over a good four decades, the S&P 500’s net profit margin has fallen notably when the economy was on the verge of, or already into, a recession.
Japan Outperforms While Manufacturing Growth Is Muted
The flash reading for the Japan Manufacturing PMI deteriorated slightly in June. The index came in at 49.9 for June against May’s 50.9.
Abe’s ‘Third Arrow’ to Benefit Investors in Japanese Equity
Quantitative easing measures in Japan are making Japanese equity attractive. Abe’s third arrow of Abenomics should boost corporate profitability and, consequently, Japanese equity.
Why China’s slowing consumption demand is an important threat
Real estate and construction are the two important drivers of China’s economic growth. They account for more than 20% of China’s gross domestic product (or GDP) when you also factor in cement, steel, chemicals, furniture and other related industries.
Must-know: Why investing in Asia requires due diligence
Asia has often been referred to as a land of opportunity. With its array of emerging and developing markets, the continent holds a lot of hope and promise for investors.
Deflation Continues in the Eurozone: VGK Down 1.43%
Consumer prices in the Eurozone remain in negative territory. Inflation was reported to be -0.1% in March. So, the Eurozone remains in a state of deflation.
Why Commodity Trading Advisors Fare Well When Nothing Else Works
CTAs (commodity trading advisors) offer diversification benefits (commodity exposure when the equity markets are down), along with liquidity.
How the US employment situation compares with the Eurozone
For some large firms, and your investments in ETFs that track these firms, the employment situation in the Eurozone makes a difference.
What Funds Have Risen despite Heightened Market Uncertainty?
The CBOE Volatility Index, a popular measure of the implied volatility of S&P 500 Index options, breached the 40 level on August 24, 2015.
How the Fed funds rates and inflation affect interest rates
As the economy expands creating inflationary pressures, the Fed raises the Fed funds rate to control inflation.
Sanctions Imposed by the West Have Fueled Inflation in Russia
The depreciating ruble, along with Western sanctions, has been fueling inflation in Russia. Russia imports large amounts of food, high-tech equipment, and cars.
EWT Rises 1.78%, Taiwan’s Unemployment Rate Holds Steady at 3.75%
On June 22, the National Statistics Office of the Republic of China reported unemployment figures for the economy of Taiwan.
Credit spreads: A fixed income investor’s must-know guide
Credit spreads are the difference in yield between U.S. Treasuries and corporate bonds of the same maturity. Corporate bonds yield more than Treasury bonds, as they carry a risk of default.
Are Commodities a Boon or a Bane for Brazil?
Brazil (EWZ) is rich in commodities. It’s among the top producers and exporters of iron ore, crude petroleum, soybeans, sugar, and meat.
What Paul Krugman Thinks about Japan’s Yield Curve Control Policy
In its latest policy move, the Bank of Japan left rates unchanged and delayed inflation target timings for the Japanese economy (EWJ) (HEWJ) (DXJ).
Will the Fed Have to Use More Unconventional Measures?
Global monetary policy is unconventional. From an era of lowering interest rates to boost economic growth, central bankers are taking rates into negative territory.
How yields, credit spreads, and interest rates are interacting
Rates have risen only modestly until now and are expected to rise gradually even after the Fed’s asset purchase program ends.
Bill Gross’s Views on Growth and Inflation
Gross believes that money has stopped generating growth and inflation. Equity prices are artificially elevated, and negative yields are guaranteeing capital losses.
VGK and EFA up on Good Inflation News from Germany and France
Rising wages in Germany have been a boon for private consumption. The weaker euro helped German exports. France also reported a revival in its inflation rate.
Why Kocherlakota says price targeting beats inflation targeting
Along with the two suggestions mentioned in Part 6 of this series, Narayana Kocherlakota also dropped in two additional suggestions for improving the FOMC framework statement.
Currency warfare: A ‘beggar-thy-neighbor’ situation
In a currency war, the “beggar-thy-neighbor” strategy is about increasing the demand for a nation’s exports at the expense of other countries’ export share.
The ‘Icahn Lift’: What Companies Have Gained from It?
Market commentators have noticed that when Icahn starts buying into a company, its stock prices rise. This trend has been called the “Icahn Lift.”
Investing in Latin America Can Bear Fruit, but Should We?
With commodity prices recovering and major developed markets (EFA) (VEA) caught in the lull, Latin America should see sunnier days ahead.
Eurozone grants bailout extension to Greece
Europe-tracking ETFs gained significantly from February 19 to February 24, when the bailout extension to Greece was approved.
A head-to-head comparison: What are ETFs and ETNs?
ETFs and ETNs are very similar—both trade on an exchange like a stock, follow an underlying product, and are easily accessible to investors.
Ray Dalio: The Next Downturn May Be a Difficult One to Reverse
“The next downturn may be a difficult one for central banks to reverse,” warned Ray Dalio, CEO of the world’s largest hedge fund.
Investors Shift Their Focus to the UK—What Lies Ahead?
In this series, we’ll look at some asset managers’ perspectives on the Brexit vote and its effect on the Market. We’ll identify factors that could lead to similar votes, and we’ll discuss what lies ahead for the UK.
Falling Commodity Prices Impact Brazil’s Trade Balance
Commodity-rich Brazil happens to be one of the important emerging markets (EEM) of the world. However, declining commodity prices are impacting Brazil’s exports.
A must-know guide to interest rates and your investments
With interest rates expected to rise from their record lows, investors are flocking to equities and high yield securities in search of returns.
The European Union Is Falling Apart: George Soros
Soros remarked, “the European Union is falling apart,” when he was interviewed by Bloomberg TV on January 22. He also sees an impending collapse in Russia.
Why the ISIS-Iraq conflict could affect global oil investments
Iraq is home to the fifth-largest oil deposits in the world and currently produces about 4% of the global oil supply. Iraq is now the second-biggest producer in the OPEC exporters’ cartel, after Saudi Arabia.
Japan Outperforms Markets So Far this Year
So far, Abe’s policy has worked well for Japan. Japanese stocks are up by almost 70%— local currency—since late 2012, which coincides with the election of reformist Prime Minister Shinzo Abe.
Are You Riding China’s Stock Market Roller Coaster?
China’s stock market performance lately has been similar to a roller coaster ride. Riders’ enthusiasm on a roller coaster builds as the ride climbs…
How Saudi Arabia’s Bond Sale Affects US Treasury Bonds
Saudi Arabia has also been involved in the sale of US Treasuries. The country is the 15th-largest holder of US Treasury bonds in the world.
Russia’s Industrial Production Contracts Again, RSX Falls 0.49%
Russia’s woes have only deepened with the Federal State Statistics Service releasing industrial output figures for July.
Dalio: What Policies Are Required of Central Bankers?
Ray Dalio: Here’s what’s required of central bankers Given the inadequacy of monetary policy measures to stimulate the economy, we may see “more direct placements of purchasing power in the hands of spenders,” believes Ray Dalio. He has outlined what central bankers should do. “Continue to make debt assets extremely unattractive for savers” For some […]
Why US and EU sanctions on Russia are having a boomerang effect
These sanctions have mainly been issued against companies in Russia’s defense industry and energy industry, as well as important Russian banks and individuals.
Sliding Ruble Pumps Russia’s Inflation Rate to 16.9% in March
Russia’s inflation rate has been trending upwards since the beginning of 2014 alongside the ruble’s decline. The ruble has declined by almost 40%.
Exposure to junk bonds: How much should you hedge?
Junk bonds are high yield bonds issued by below–investment grade corporations. Due to the low ratings and high risk of default attached to these bonds, they’re popularly called “junk bonds.”
Mortgages: An Alternative outside the Stock Market
Jeffrey Gundlach thinks that in today’s environment, investors will need to find alternatives outside the stock market if they want returns.
The Broad Market Is Tending above the GDP Curve: A Positive Sign
Indicators change as the business cycle progresses and help define the business cycles. The industrial production curve has been with the GDP curve.
How Low Interest Rates Have Hurt Venezuela, Puerto Rico, and Brazil
Low global interest rates have been catastrophic for Brazil. Growth is stagnant while inflation continues to soar.
Bill Gross Shuns the Taylor Rule and the Phillips Curve
The Taylor rule is a backward-looking model used to determine short-term interest rates in an economy. Bill Gross prefers a corollary to Gresham’s law.
Italy’s Inflation Rate Rose in August: EWI Fell 0.40%
According to the August 31 release by the ISTAT, the EU’s harmonized inflation rate in Italy rose to an impressive 0.50% in August on a YoY (year-over-year) basis.
Letting Alternative Investments Hedge Your Returns against Deflation
An alternative investment is an investment in asset classes other than stocks, bonds, and cash that seeks to provide a hedge against various market risks.
Has Britain Really Voted Its Way to Prosperity?
The Brexit referendum aftermath has translated to gains for certain hedge funds, while washing away earlier gains for others.
Overview: What is Pipelineistan?
As percentages of the worlds’ total reserves, Russia holds 45% of the gas, 23% of the coal, 14% of the uranium, and 13% of the oil. Currently, Russia is the world’s largest energy supplier.
Why investors prefer dividends in a low interest rate environment
The Fed’s policy of keeping the nominal interest rates at a zero lower bound leads some investors to seek higher and stabler income elsewhere. The low-interest rate regime may force risk-taking investors towards the higher-cost debt of high yield bonds.
Bank of Portugal Defied Pari Passu: What Does It Mean?
By assigning five of Novo Banco’s 52 senior bonds to Banco Espirito Santo, the Bank of Portugal defied the principle of pari passu.
Russia in Recession: Growth Contracted by 4.6% in Q2
Russia’s annual GDP (gross domestic product) growth rate plummeted to -4.6%, according to the latest figures released from the Federal State Statistics Service.
Investor Sentiment Favors Peru, Chile, and Brazil
Investor sentiment with respect to Latin American economies has definitely been changing since the beginning of the year.
Ukraine and Russia at the brink of war: All major indices affected
Russia began the Ukrainian invasion by invading Donetsk, and with the Ukrainian army trying hard to regain control, the situation seems a little short of a battle to begin.
Why you should invest in some of the 1,500 ETFs in the US
In this series, we’ll introduce you to the concept of exchange-traded funds (or ETFs). You’ll find out about the types of ETFs and how they can help your portfolio.
New Home Sales Fell 6.80% in June: ITB Fell 2.20%
Existing home sales in the US recorded a 482,000 annualized figure in June—compared to 517,000 recorded in May. It failed to meet census expectations of 550,000 units.
Jeffrey Gundlach: The Junk Bond Market Needs Higher Oil Prices
Jeffrey Gundlach also warned about the high-yield market (HYG) (JNK). He said the “clock is running out” for energy companies (IEZ) due to low oil (USO) prices.
Jeffrey Gundlach: The Fed Has Been Supporting the S&P 500
Gundlach also believes it’s interesting to look at the correlation between the size of the Fed’s balance sheet and the S&P 500 (SPY) (SPXS) (SPXL) level.
Dividend ETFs Continue to Benefit from the Fed’s Low-Rate Policy
Dividend investing involves looking for companies that generate steady cash flows for shareholders. They’re likely to outperform when the economy is down.
A quick look into the most indebted country in Europe: Greece
On November 14, 2014, Greece’s economy finally registered some growth and emerged from recession. The economy expanded by 1.7% in Q314, compared to 3Q13.
Is the Brexit Vote the Beginning of a Movement?
Popular opinion holds that the Brexit referendum has opened the gates for other such votes in the future.
Gundlach: Negative Interest Rates Are the Definition of Deflation
Gundlach has no interest in sovereign debt at negative interest rates. He said that it’s a “guaranteed loss.” Bill Gross shares this view.
Dalio: Japan Is Undergoing an ‘Ugly Deflationary Deleveraging’
“Deleveraging” refers to reducing the debt level. With Japan’s debt burden, deleveraging the economy’s balance sheet seems more than imperative.
Industrial Production Contracts in Russia in June, RSX Falls 1.6%
Industrial production in Russia declined by 4.8% in June on a year-over-year basis. The Russian equity–tracking VanEck Vectors Russia ETF (RSX) was down 1.6%.
US Equity Is Expensive, so Where Can I Look for Relative Value?
US equity has become expensive, and its PE ratio continues to be elevated despite the fact that companies in the United States have been using the low-interest rate regime to financially lever their earnings.
Oil price drop wreaks havoc on Russian economy
The continued oil price drop, coupled with the impact of Western sanctions that are fueling inflation in the economy, is wreaking havoc on Russia’s economy.
Russian Ruble Reversal: Inflation Rate Falls to 16.4% in April
Russia’s inflation rate had been trending upward since the beginning of 2014, in tandem with the ruble’s decline. But the country’s central bank believes that the worst is now over for Russia.
Are We at the End of a Business Cycle?
An early contraction, middle bear phase seems to suggest that we are near the end of the current business cycle.