The markets saw some back and forth this month but the S&P 500 closed the quarter up about 5% and even bonds managed to eek out a small gain. The "Trump rally" is moving along, and the market still buys the president's campaign promises. But following the capitulation of repeal and replace, Trump's ability to … Continue reading Buy the Rumor, Sell the News
As I've been pointing out, economic conditions in the US aren't as bad as some fear mongers in the financial media are portraying. To be clear, conditions aren't spectacular. Growth is muted and prospects aren't stellar. But on the margin, the US economy continues to grind forward with no imminent signs of the dreaded "R" … Continue reading The US Muddles Along
The financial media has been pointing out that employment is steadily improving. A cursory look at the numbers seems to support that. For example, the unemployment rate has declined to 8.2%, down from 9.1% last year. Some will be quick to point out the decline was due to workers leaving the labor force, and not because of improving employment. However, it's difficult to say that no job-related measures have improved. Over the past year, the … Continue reading Working Hard?
The markets are quivering in anticipation of what the Federal Reserve may or may not announce later today. The consensus is that it will decide on implementing "Operation Twist." In this situation, the Fed would maintain short-term rates while reaching out to lower long-term rates, effectively "twisting" the yield curve. The idea is that lowering long-term rates will encourage borrowing, spending, and investment. However, … Continue reading Twist and Shout