Before its notoriety as an international blockbuster, "Crouching Tiger, Hidden Dragon" was an ancient Chinese proverb used to describe a person, place, or thing with remarkable but hidden qualities. The current tariffs and trade war resemble an analogous situation for the US with unseen dangers. I recently wrote about the obvious problems of an escalating … Continue reading Couching Tariff, Hidden Danger
U.S. markets celebrated President-elect Trump's victory with a rally in risk assets. The thinking is a Trump presidency means lower taxes and fewer regulations. Both are good for business, investors feel elated and expect a repeat of 2017. But should they? Some forgot expectations were far less festive about Trump in 2016. Many feared disorder … Continue reading Great Expectations & Feelings
The U.S. presidential election is less than a week away. Both sides are dug in and tensions are so thick you could cut them with a knife. Not only is this expected to be a close race, but as both candidates decry, it will be one of the most consequential elections of our time. They … Continue reading Red, White, & Blue
Storied debt ceiling games Once upon a time, the U.S. government imposed a limit on how much the country could borrow. A debt ceiling was a prudent idea and a good story, but in reality, that ceiling was breached countless times since its inception. In January of this year, the U.S. broke above the most … Continue reading Playing Dirty with Default
On Friday, December 22, President Trump signed the Tax Cuts and Jobs Act into law. This finalized what is considered to be the most significant (and contentious) tax code overhaul in decades. Many questioned if this would be done in 2017. Now that it is, there're only days left for people to react before year … Continue reading A Few Days and Things to Consider
"...but in this world, nothing can be said to be certain, except death and taxes." -Benjamin Franklin Taxes are certainly top of mind as the Senate plans to vote on a final version of tax reform this week. There's still uncertainty about what will ultimately pass, but as of now, it seems at least a … Continue reading Death and Taxes
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
Yesterday, the US made history with an upset of presidential proportions. Despite being a huge underdog, Donald Trump clinched the presidency from strongly favored Hillary Clinton (who pollsters estimated had a 90% probability of winning). Following the upset, investor uncertainty spiked and Dow futures traded down more than 800 points. Yet the S&P 500 actually … Continue reading Surprise, Surprise
Yesterday the United Kingdom made history by delivering a surprise vote to leave the European Union. Though the odds were close, market pricing was tilted towards a "Bremain" vote -- so "Brexit" was an unexpected outcome. Markets reacted commensurately today, European equity markets were down more than 7% and the Sterling down more than … Continue reading Following the Brexit Signs
After improving economic prospects earlier this year, Japan has abruptly reversed course. A third-quarter annualized GDP reading of negative -.8% puts Japan back in a technical recession (defined as two quarters of negative GDP growth). Following stimulative policies (aka "Abenomics") by Prime Minister Shinzo Abe and a blossoming recovery from 2014's technical recession, many assumed … Continue reading Japan’s Footsteps
It's been over five years since Greece's current financial crisis started making public headlines. Since then Greece has received more than 240 billion Euros of bailout loans from the ECB, the IMF, and the EU (aka the "Troika"). That figure doesn't include the "phantom" aid that Greece also received in the form of the debt … Continue reading Big Trouble in Little Athens, Revisted
Last week JP Morgan stunned the world by announcing that it suffered over $2 billion in losses from derivative trades gone awry. Ironically, JPMorgan was considered to be one of Wall Street's more responsible banks - one that avoided the derivative disasters of the financial crisis. Even more ironic, JP Morgan's CEO, Jamie Dimon, has been one of the most outspoken bankers fighting against increased regulation of financial services. Unfortunately … Continue reading The Best Policy
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