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Bridgewater: What Are Ray Dalio’s Top Investing Ideas?
Founded by Ray Dalio, Bridgewater Associates’ top sell in the third quarter was the iShares MSCI Emerging Markets ETF (EEM).
JPMorgan Chase Expects Gold to Go Higher in 2019
JPMorgan Chase (JPM) thinks that gold prices (GLD) should go higher. Right now, the Fed is patient on rate hikes.
Strong Growth and Muted Inflation: How Will the Fed React?
While the markets aren’t expecting any changes in rates following the meeting, they’re keenly awaiting the Fed’s strategy to deal with strong economic growth accompanied by low inflation (TIP).
Do Strong Growth and Weak Inflation Make a Case for a Lower Rate?
The US Bureau of Economic Analysis released its personal consumption expenditure (or PCE) price index today. The PCE index is the Federal Reserve’s preferred gauge of inflation.
Gundlach Isn’t Convinced with the Fed’s Rate Hike Outlook
Gundlach expected the Fed to go from two expected hikes in 2019 to 0.5 hikes. However, the Fed surprised him by projecting no hikes this year.
These Assets Could Be Attractive If Fed Rethinks Inflation Course
The Federal Reserve’s two main objectives are stabilizing prices and maximizing employment.
Modern Monetary Theory Might Have Takers, but Gundlach Isn’t One
Jeffrey Gundlach is very concerned about the increasing debt in the US economy.
JPM Likes Gold, as Fed Might Let Inflation Overshoot Target
The Federal Reserve has two main objectives: price stability and maximizing employment.
Buffett versus Dalio on Gold: Whose Advice Should You Take?
When it comes to investing in stocks, Berkshire Hathway’s (BRK.A) chair, Warren Buffett, and Bridgewater’s founder, Ray Dalio, have similar advice.
What Makes Fund Managers So Bearish on Market Prospects?
Out of the investors surveyed, 46% expect global growth to weaken over the next 12 months.
Fed: Jobs Report Could Show Future Rate Hike Path
Fed policymakers are watching the job data closely. The data show whether the US economy is strong enough to withstand interest rate hikes.
Wage Growth Could Catch the Job Market’s Strong Fundamentals
Wage growth could be the most closely watched component of the US jobs report. Wage growth hasn’t consistently gone in the right direction.
What Supports J.P. Morgan’s Bullish Stance on SPY?
J.P. Morgan (JPM) has one of the most bullish views on Wall Street about the stock market outlook in 2019.
What Could US Jobs Report Mean for the Fed and Rate Hikes?
Fed policymakers are watching job data closely, as the data gives the Fed insight as to whether the US economy (SPY) (IVV) is strong enough to withstand interest rate hikes.
Could December’s Wage Growth Spook the Already Volatile Markets?
Wage growth will likely be the most closely watched component of the US (VOO) jobs report.
Why the Fed Could Make Gold Shine Next Year
A major factor weighing on gold prices this year was the Fed’s tightening cycle.
Largest Ever One-Month Rotation into Bonds Signals Pessimism
Another concerning statistic that came to light during the Bank of America Merrill Lynch’s Fund Manager Survey was that investors made the largest ever one-month rotation into bonds (BND).
Goldman Sachs’ Take on Uncertain Stock Market: Get Defensive
Last month, Goldman Sachs predicted the S&P 500 (SPY) will reach 3,000 by the end of 2019.
Will Gold Surge as the Fed Says to Wait and See?
The Federal Reserve Committee plans to meet for the last time in 2018 on December 18–19. The committee is widely expected to raise interest rates (TLT) by 25 basis points, marking the fourth hike this year.
Are Stock Markets Celebrating a Weaker US Jobs Report?
The US jobs report for November was released today.
Will November Jobs Report Give Fed the Green Light to Hike Rates?
Fed policymakers are watching the job data closely, as it gives them insight as to whether the US economy is strong enough to withstand interest rates hikes.
Could November’s Wage Growth Shake the Markets Again?
Wage growth will likely be the most closely watched component of the US (VOO) jobs report.
Could the Market Be Misinterpreting Powell’s Remarks?
One question we need to ask ourselves is whether yesterday’s surge in the markets (QQQ)(DIA) is justified. The answer depends on our understanding of Fed Chairman Jerome Powell’s comments.
How Investors Could Position in the Late Cycle of Expansion
After a prolonged calm period, a sell-off in equities (SPY) (QQQ) in October and again in November has shaken the markets out of their slumber.
Gold Price Outlook: Analysts Are Watching These Factors
Bank of America analysts contend that gold prices (GLD) should surge over the next year.
Stretched Equity Valuations Start to Weigh In
Since equities have slumped in October, investors are reassessing the price they should be paying for the forward earnings.
CPI Underwhelms Today: Will the Market Heave a Sigh of Relief?
The US consumer price index (or CPI) for September was released today at 8:30 AM EST. Inflation numbers were weaker-than-expected.
Does the Sell-Off Imply Market Repositioning for Lower Growth?
The Dow Jones Industrial Average Index tumbled more than 800 points yesterday as Treasury yields continued their upward march.
US Equities Down on Rising Rate Fears: Watch Out for CPI Next
Increasing interest rates spooked investors again today as US stocks dropped sharply amid rising Treasury yields.
Will Physical Gold Demand Be Deciding Factor for Gold in H2 2018?
The demand for gold in India (INDA) was lukewarm in the first half of the year, mainly due to stronger equity markets and higher gold prices measured in rupees.
Will Equity Valuations Pass the Stress Test of Rising Bond Yields?
For the last few days, the bond markets have seen sell-offs due to stronger-than-expected economic data and hawkish comments from the Federal Reserve.
Is the Current Sell-Off a Blip—or the Start of a Downtrend?
Whether the recent sell-off in the bond and stock markets is just a blip or the beginning of a sustained downward rally will depend on the upcoming US economic data.
What to Look for in the Fed’s September Meeting
The Fed is scheduled to meet on September 25–26. The Fed is widely expected to raise rates by 25 basis points during the meeting.
What Will the Fed Look for in the August Jobs Report?
Job numbers give Fed policymakers clues about whether the US economy (SPY) (IVV) is strong enough to withstand interest rate hikes.
As Earnings Season Comes to an End, Markets Focus on Fed, Trade
The Fed’s annual economic policy symposium starts Thursday. Fed chair Jerome Powell will speak on “Monetary Policy in a Changing Economy.”
Could Physical Demand Come to Gold’s Rescue in H2 2018?
The rupee has depreciated by ~7.0% year-to-date against the US dollar. This event caused local gold prices to rise.
Fresh Sell-Off Hits Gold: Is $1,200 the Next Stop?
Gold prices (IAU) have been on a losing spree since mid-April due to the US dollar’s strength and diverging monetary policies.
Oil Prices Soar on OPEC Agreement—What Does It Mean for Gold?
After its June 22 meeting, OPEC decided to increase its output. However, this increase was lower than what the markets expected.
How the Yield Spread Changed the Outlook for the Economy
In the May LEI report, the yield spread had a net impact of 0.14 (or 14.0%).
Why There Could Be More Room for Inflation Growth
The PPI for final demand in May is reported to have increased by 0.5% month-over-month.
Why Does the Fed Expect Unemployment to Fall Further?
The US Federal Reserve has a dual mandate of achieving maximum employment and stable prices (TIP) in the economy.
FOMC: We Are Not Declaring a Victory on Inflation
The FOMC’s June statement was released on June 13, and the outlook for inflation remained upbeat.
How Could High Inflation Affect the Fed?
During the Fed’s May meeting, the inflation (TIP) target was described as “symmetric,” suggesting that the 2% target would not be used to initiate any dramatic changes to US monetary policy.
Why This Week Could Define the Direction of Monetary Policy
The central banks of the US, EU, and Japan are scheduled to meet this week.
What Now as the US Fed Is Close to Meeting Its Targets?
As of June 1, the unemployment rate in the US has dropped to 3.8%—its lowest level in the last 18 years.
Louis Gave Believes Inflationary Boom Will Support Gold
Gave believes the disinflationary boom is the natural state of capitalism and shifts to an inflationary boom every 30–40 years.
This Economic Data Point Decreased the Odds of a 4th Rate Hike
In the current economic climate, we can expect the Fed to take a step back with respect to interest rate hikes.
Which Sector Posted the Most Job Gains in May?
As per the May ADP employment report, job growth in the professional and business services sector continued to be the key driver for jobs additions.
Why the FOMC Isn’t Confident about Sustained Inflation Growth
The FOMC’s May meeting minutes indicated that some of its members had turned bearish on inflation (TIP).
Key Takeaways from May’s FOMC Meeting Minutes
The most recent FOMC meeting was on May 1–2. At the meeting, the range for the federal funds target rate was left unchanged.
Will Yield Spreads Continue to Decline?
The US bond markets remained under selling pressure as bond yields, especially at the short end of the curve, continued to shoot up, while the long-term yields remained subdued.
Falling Weekly Claims Signal Overheating Job Market
The Conference Board uses average weekly unemployment claims as a constituent of its Leading Economic Index (or LEI).
Could the US Dollar Slump Be Short Lived?
The US dollar depreciated against its major trading-partner currencies after the Bureau of Labor Statistics reported on May 10 that US consumer prices grew 0.1% in April after falling 0.1% in March.
Bond Yields Fall after April Inflation Data Release
US bond market investors were relieved after the US Bureau of Labor Statistics’ April report, published May 10, indicated a lower-than-expected inflation growth rate.
Why Equity Markets Rose after April’s Inflation Report
US indexes (SPY) are reaching highs as investors ignore possible threats of the US pull-out from the Iran nuclear deal and focus on increasing crude prices.
How April’s Inflation Data Relieved Markets
On May 10, the Bureau of Labor Statistics reported that US consumer prices rose 0.2% in April.
Could there be a 4th Rate Hike in the Cards?
The Bureau of Economic Analysis defines PCE (personal consumption expenditure) as the value of goods and services purchased by, or on behalf of, US residents.
Which Sector Posted Major Job Gains in April?
The US employment market could be overheating. Businesses are adding more than 200,000 jobs per month despite rising trade tension.
Why 1Q18 Real GDP Estimate Raises Chance of 4th Rate Hike
The Bureau of Economic Analysis (or BEA) released its first estimate for 1Q18 real GDP on Friday.
Key Macro Events This Week
US markets (IJH) will be tracking ongoing corporate earnings. US markets could be influenced by the multiple economic reports scheduled this week.
What March Capacity Utilization Data Says about Economy
The total industry capacity utilization in March increased from 77.7% in February to 78.0% in February.
Why Interest Rate Spreads Are Decreasing Again
In April, the yield spread has declined to the lowest level since the Great Recession and could decline further if inflation doesn’t accelerate.
Should We Start Ignoring the Yield Curve Inversion?
No financial indicator is foolproof, and the same can be said about the flattening yield curve in the current economic climate.
Why Rising Inflation Failed to Raise Long-Term Yields
The primary reason cited by the FOMC for holding off on interest rate hikes since 2016 was lagging inflation growth.
What Makes the Yield Curve Turn Flat or Invert?
The reason for the current yield flattening in this cycle is lower expectations for inflation growth.
US Job Openings Still Near Highs
The BLS released the “Job Openings and Labor Turnover Survey” for February on April 13.
Why Bond Yields Weren’t Affected by the March Inflation Report
US bond market investors are constantly concerned about inflation.
Why Rising Inflation Could Pose a Threat to Equity Markets
On April 11, market participants expected a volatile session after the US inflation report, but, to their surprise, Donald Trump’s tweet earlier in the day about Syria and missiles pushed markets lower.
Why March’s Inflation Numbers Could Pressure the Fed
The US Bureau of Labor Statistics has reported that US consumer prices fell 0.1% in March.
US Inflation Rises: How Will It Impact Gold Prices?
According to the US Bureau of Labor Statistics, the US consumer price index (or CPI) rose 2.4% year-over-year (or YoY) in March 2018.
FOMC Members Are More Confident about Inflation
The March FOMC meeting minutes indicated that the staff and FOMC members turned bullish on inflation.
FOMC on the Economic Situation: A Strong US Economy
In the March meeting minutes, the FOMC staff review of the economy was stronger than the review presented at the January meeting.
Key Takeaways from the March FOMC Meeting Minutes
The last FOMC (Federal Open Market Committee) meeting was on March 20–21, 2018. Overall, the FOMC minutes were “hawkish.”
What Drove Consumer Sentiment Index to 14-Year High?
The University of Michigan final consumer sentiment for March was reported at 101.7, up by 1.7 as compared to the final February reading of 99.7.
Why Soft March Payrolls Aren’t a Weak Sign for the Economy
The non-farm payrolls for March rose by 103,000, which was below the consensus expectation of 193,000 jobs being added.
How February PCE Inflation Data Could Affect Fed’s Decisions
Personal consumption rose 0.2% in February and by 4.6% in the last 12 months.
Why Rosengren Thinks US Monetary Policy Tools Are Inadequate
In his keynote delivered at the tenth conference organized by the International Research Forum on Monetary Policy in March, Boston Federal Reserve president Eric Rosengren highlighted US policy tools’ deficiency in combating another recession.
What Are the Reasons behind Improved Projections for US GDP?
Policy changes announced in the last six months may have led to the increased projection for economic growth.
What to Make of the Rebound in the Final Estimate for 4Q17 GDP
The Bureau of Economic Analysis released the third and final estimate for 4Q17 GDP, indicating that the economy has improved at an annual rate of 2.9%.
Why the Fed Expects Unemployment to Fall to 3.6%
Over the last 12 months, unemployment levels have fallen to a 17-year low of 4.1%.
What’s the Fed’s View on Inflation Growth?
The FOMC’s March statement was released on Wednesday, March 21, and the outlook for the closely watched inflation remained muted.
Why Did the Fed Upgrade Its GDP Forecast for 2018?
In the latest SEP release, the Fed upgraded its GDP growth outlook for 2018 by 0.2% to 2.7%.
A Strengthening US Economy and a Cautious Fed
In the first policy meeting under new Fed chair Jerome Powell, the FOMC (Federal Open Market Committee) increased the interest rate 0.25%.
February’s Capacity Utilization Trends across US Industries
According to the Federal Reserve, total industry capacity utilization increased 1.3% from 77.4% in January 2018 to 78.1% in February.
Could Increasing Job Openings Mean Trouble for Markets?
The Bureau of Labor Statistics released its JOLTS (Job Openings and Labor Turnover Survey) data for January on March 16.
Why Gradual Rate Hike Possibility Hurt the US Dollar
The US dollar depreciated against its major trading partner currencies after the US inflation (TIP) report was released on Tuesday.
Why Equity Market Spike after Inflation Report Could Be Short-Lived
The most awaited economic data release of the week proved to be risk positive, as inflation growth for the month of February was reported at 1.8%.
Why Odds of 4th Rate Hike Fell after February Inflation Report
The US Bureau of Labor Statistics reported that US consumer prices increased marginally in February.
Why Economist Argue That Tariffs Are Bad for the Economy
The recently proposed import tariffs on steel and aluminum imports by US President Donald Trump are an effort to protect the interests of US manufacturers.
Why the Fed’s Rate Hikes Are behind Schedule
Nominal GDP indicates higher rates The recently released second estimate for 4Q17 GDP indicates that the US economy grew 2.5%, a percentage point lower than the advance estimate of 2.6% and considerably lower than the 3Q17 growth of 3.2%. The nominal GDP growth rate, which is the real growth rate plus inflation (TIP), was 4.9%. The nominal […]
Could the Lower 4Q17 GDP Estimate be Reason to Worry?
The US Bureau of Economic Analysis (or BEA) has released its second 4Q17 GDP estimate, projecting that the US economy increased at an annual rate of 2.5%.
How Big a Problem Could US Debt Become?
If we turn back the clock to before the recession, we find that US debt levels weren’t this high, and unconventional programs like quantitative easing helped the economy recover from the Great Recession.
Why the US Economy Could See a Higher Deficit
A government budget deficit occurs when an economy’s annual revenue is less than its total expenditure.
Have We Missed a Greater Threat in the Recent Market Turmoil?
The recent market turmoil that shook investors’ confidence has settled for the time being, but…
Why Buffett Believes Investing in Bonds Is a ‘Terrible Mistake’
The increasing demand for fixed income investments has pushed bond prices higher and yields lower, but investors have continued to pour money in.
Buffett’s Investment Advice When Inflation Rises
Warren Buffett has been a great believer in the equity market. His strategy of buying stocks after a dip has been fruitful for investors.
Why FOMC Members’ View on Inflation Is Bad for Equity Markets
FOMC members have cited several factors that could increase inflation (VTIP) in the medium term.
FOMC’s Review of Economic Situation Signals Strong US Economy
As per the FOMC staff report, inflation (TIP) in the US remained below the 2% target.
January FOMC Meeting Minutes: ‘Further’ Hikes Possible
The recent market turmoil was related to the possibility that the US FOMC could increase interest rates sooner than expected.
Will the Bond Market Rebound along with Equity Markets?
US bond markets found some relief in the week ending February 16, as bond yields retreated from their multiyear high at the end of the week.