Posts On Economic and Geopolitical News

August 17, 2016 |

Is Bond King Bill Gross Saying Go For Gold?

Debt Chain

Stocks are at fresh all-time highs and investors seem to be feeling better about the economy. While investors’ sentiment may not have yet reached the euphoric stage, stocks could potentially have some room to run higher. Or could they? While stock bullishness appears to still be at healthy levels, some investors may be questioning just how much further the current rally can run. Some investors, like Janus Capital Group portfolio manager Bill Gross, feel that perhaps investors should be cutting their risk. Of particular note... Continue Reading

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August 9, 2016 |

BOE Takes Action

Economic stimulus

The Bank of England yesterday took some preliminary measures to boost economic activity following the nation’s June 23rd vote to exit the European Union. These measures included an interest rate cut from .5 to a record low .25 percent along with some $10 billion in corporate bond purchases and $60 billion in government debt. And there may very well be more to come… While stocks were heavily sold-off initially following the Brexit vote, they have come roaring back, with some indices reaching fresh all-time highs.... Continue Reading

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August 3, 2016 |

The Stock Market Fallacy

how quickly things can change

After seeing a decent sell-off following the June 23rd Brexit referendum, stocks have not only fully recovered, but the broad market S&P 500 is probing deeper into new all-time high territory. After the S&P fell over 120 handles in the wake of Brexit, the market took just days to recover. Since that recovery, the market has remained on the offensive, with seemingly unstoppable forces behind it propelling it to fresh all-time highs. This begs the question: What powers could be behind the sharp rise in... Continue Reading

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August 1, 2016 |

GDP Outlook Slashed

Gold umbrella

Investors have been cautious this week ahead of Wednesday’s latest FOMC meeting announcement. With no major surprises, the central bank elected to hold rates steady-at least for now-and eluded to the possibility of another rate hike in September. Kind of like kicking the can down the road… The Fed discussed improving conditions in the labor market and stated “Near-term risks to the economic outlook have diminished.” In other words, markets have recovered from the post Brexit freak out-for now anyway. The Fed has left the... Continue Reading

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July 28, 2016 |

Trump Win Could Drive Blistering Rally in Gold

Democrats vs Republicans

It’s no surprise that with a presidential election comes a lot of uncertainty. After all, various candidates can have wildly differing views on the domestic economy, monetary and economic policy, foreign policy and more. There is certainly a lot riding on the upcoming U.S. Presidential election in what is shaping up to be an intense race. In fact, the nation appears to be very divided, with very different opinions and plans being presented by both candidates. As the election approaches, uncertainty surrounding the potential outcome... Continue Reading

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July 26, 2016 |

ECB Ready for More Printing?

Printing press

The European Central Bank met yesterday and as expected, kept interest rates at record lows in an attempt to revive growth and spur inflation. The central bank also added that it intends to maintain rates at current levels, or possibly even lower for an extended period of time. Back in March, the ECB cut its deposit rates deeper into negative territory and increased its stimulus measures. While no action was taken yesterday, the overall message appears to be pretty clear: Rates could remain low and... Continue Reading

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July 18, 2016 |

A Black Hole of Debt

Black hole

In the German language, the word for debt – ‘schuld’ – means the same thing as guilt. Someone who has a tremendous amount of guilt would seek forgiveness. So the term many economists are now using – forgiveness – in regards the world’s growing debt problem would seem appropriate. But this term does not encapsulate the crises that would result if a large portion of debt was erased by policy makers. Until recently, the term ‘debt forgiveness’ in regards to government and corporate debt was... Continue Reading

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July 14, 2016 |

The Spread of Negative Interest Rates

Bank_run

The spread of negative interest rates has been highly publicized in recent months in a trend that could, unfortunately for depositors, continue. While much has been made of low rates in the U.S. in recent weeks while the ten year note sits around 1.4%, the fact is that in some countries depositors now not only receive zero yield but must pay for the privilege of having a bank hold their money. Some European banks began cutting rates below zero in 2014, and Japan has followed.... Continue Reading

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July 6, 2016 |

A Lurking Danger

major hurdles

It seems that the pace and timing of additional interest rate hikes by the Federal Reserve has largely dominated financial headlines in recent months. While the general consensus seems to be that the pace of further hikes will be very slow and incremental, we’d like to present an alternative possibility that seemingly few investors are considering. What if inflation expectations were to pick up rapidly? What if in the coming quarters, inflation were to accelerate at a pace significantly faster than the Fed’s two percent... Continue Reading

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June 24, 2016 |

The Vote Is In – Brexit Becomes Reality

Brexit

In a historic vote that shook financial markets on Friday, the people of Great Britain have voted to exit the European Union. While optimism over the nation remaining in the union seemed to be on the rise heading into Thursday’s vote, things changed quickly once the votes starting being tallied. Stock index futures, interest rates and currencies starting seeing massive volatility on Thursday night as the results came in. Brexit was becoming a reality… At one point, S&P 500 futures went “limit down” with a... Continue Reading

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