Posts On Economic and Geopolitical News

February 21, 2018 |

There’s Few Good Options

Gold umbrella

Alternative asset classes are more important than ever, and investors have never had so many vehicles with which to diversify their portfolios. This would seem to be especially important in the current environment, where neither stocks nor bonds may offer investors a good value. The stock market has been on the rise for the last decade. Although it is impossible to say exactly when the bull market may finally come to an end, history would seemingly indicate that the current bull could run out of... Continue Reading

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February 17, 2018 |

Inflation Running Hotter

This week, investors anxiously awaited the release of key inflation data that has the potential to be market-moving. On Wednesday, markets saw the most recent data on CPI. The month-over-month reading came in at .5%, above consensus estimates of a .3 or .4% rise. The core CPI reading, which excludes volatile food and energy costs, seemingly confirmed the higher month-over-month data with a rise of .3%. Today saw the release of the latest data on PPI, which also points to increasing price pressures. Month-over-month PPI... Continue Reading

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February 15, 2018 |

Are Markets Headed Back to Earth?

Polar Bear

The recent volatility seen in global stock markets has largely dominated headlines in the financial media recently, and many investors are likely wondering why the sudden sharp increase in price swings. Regardless of what the reason may be-whether it is overaggressive betting against volatility, the idea of rising rates, accelerating inflationary pressures or the current state of geopolitics-there may be a simpler, albeit unpopular answer: Stocks and risk assets are seeing a return to valuations more in line with historical norms. That’s right: Stocks have... Continue Reading

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February 9, 2018 |

Pay Attention

stock-market-crash-crisis copy

The stock market has exhibited enormous volatility in the last several sessions. It started last Friday, with the Dow Jones Industrial Average dropping over 700 points. The sellers were far from finished, however, and the selling resumed full force on Monday. The opening session of the trading week saw the Dow decline by an astounding 1600 points at one point, before rebounding a bit to end down a whopping 1175 points-the largest point decline on record. Tuesday looked as if it might be another brutal... Continue Reading

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February 7, 2018 |

Are Higher Yields Starting to Take a Toll?

decline for stocks

The stock market saw major declines on Friday, as the Dow Jones Industrial Average shed over 700 points. Friday’s sell-off, and weekly performance for the indexes, was the worst in some time. Unfortunately, it could be just the opening salvo by stock market bears, and further declines could be ahead. The current risk-off mentality is likely being fueled by several factors, but rising interest rates are, without question, a major catalyst for declining stocks. On Friday, yields on the benchmark ten year note hit 2.85%,... Continue Reading

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February 2, 2018 |

Don’t Fear Higher Rates, Welcome Them

the stage is set

The U.S. Federal Reserve elected to hold rates steady at its latest policy meeting on Wednesday. This move came as no surprise. The Fed also discussed how it sees the need for gradual hikes going forward, which is also not very newsworthy. Many investors, however, seem to misinterpret what higher rates really mean for the markets. Gold is a common object of discussion when it comes to higher interest rates. The theory, among some investors and some financial “experts” goes something like this: Higher rates... Continue Reading

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January 31, 2018 |

Is FOMO Finally Here?

Stocks have seemingly climbed higher with little effort for some time now. In fact, the stock market has made it look easy. Ultra-low rates, previous QE, increasing corporate earnings-whatever the primary drivers of higher stocks may be, the bull market is not going to continue indefinitely. Stocks have recently been moving higher on the idea of lower corporate tax rates and higher profits, less regulation, the potential for higher wages and other factors. Also at work, however, is another catalyst. Only this catalyst can often... Continue Reading

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January 30, 2018 |

A Double Whammy of Rising Inflation and a Falling Dollar

major hurdles

Investors could potentially be in for a rough ride in 2018, as several key market dynamics are changing. The Fed has been slow to raise rates further-and with good reason- as inflation for some time lagged well-below the central bank’s desired target of 2% annually. The central bank seems to be thinking a bit differently at this point, however, as some key indicators of inflationary pressure have been ticking higher in recent months. The central bank has penciled in three rate hikes this year, but... Continue Reading

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January 26, 2018 |

The Dollar is Getting Weaker

race to the bottom

Gold is seeing prices pop on Wednesday, as the dollar index declines to a 4.5 month low. The dollar index appears to have put in a long-term top at this point, and looks both fundamentally and technically weak. This weakness could potentially send the greenback even lower-dramatically lower-from current levels. The buck is seeing selling pressure today as Treasury Secretary Steve Mnuchin talks about how a weaker dollar is beneficial for the U.S. economy. His comments were made in Davos, Switzerland, at the World Economic... Continue Reading

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January 24, 2018 |

Is the Dollar a Sinking Ship?

without a deal

The shutdown of the U.S. Government over the weekend is likely to dominate the headlines this week. Although it seemed late Friday that a deal could potentially be reached in time, Republicans and Democrats appear to be far from an agreement at this point. Stock investors didn’t seem to be fazed by the potential shutdown on Friday, but that could change in a hurry if both sides of the aisle are not able to make progress quickly. Although the shutdown is not likely to have... Continue Reading

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