Markets & Economy

The Debt Is High, But Does It Matter?

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The US stock market has been on a fantastic run in 2018 even though returns are close to the historical average because other markets have seen weakness. As you can see from the chart below, US stocks underperformed last cycle and outperformed this cycle.  Source: Bank Of America Merrill Lynch…CONTINUE READING

The Trade War Just Started

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With the US stock market near its all-time high and having a solid year, it’s easy to miss out on the global growth deceleration. The global economy is by no means terrible, but it has seen deceleration as the global synchronized growth narrative disappeared, with emerging markets feeling a significant…CONTINUE READING

Optimism Doesn’t Match Economic Growth

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In this article we will be showing various data points from different perspectives. We like to give you all the information to make the best possible decisions. The goal isn’t to push any narrative, political agenda, nor market perspective. The value provided is helping you understand the details behind various…CONTINUE READING

Inflation Falls: Is The Economy Even Late Cycle?

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As we previously discussed, real wage growth is becoming a reality, having appeared in August. Average hourly earnings were up 2.9% and weekly earnings growth was 3.2%. Inflation stats have come in below expectations as we will discuss in this article. Before we get to that, it’s worth noting that…CONTINUE READING

The Next Recession Could Be In 2019

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With Q2 S&P 500 earnings growth at 26.58%, core PCE inflation only at 2%, and small business optimism at the highest level in the 45 year history of the NFIB survey, there’s not much reason to be bearish on equities in the intermediate term. The biggest concern in the next…CONTINUE READING

Was The August Jobs Report Good or Bad?

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The most interesting part of reviewing the labor market stats is how two analysts can look at the same data and can extrapolate completely different conclusions. We’ll show you the positive and negative theses from the August labor report. First let’s review the headlines. Even in the headlines there is…CONTINUE READING

World Earnings Excluding Tech At Pre-Crisis Levels

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It’s hasn’t been surprising to see the Fed’s projections for rate hikes differ from the futures market in this expansion. The interesting part about the current divergence seen in the chart below is that the Fed could be near the end of the hike cycle.  Source: Pension Partners The futures…CONTINUE READING

Link Between Inflation & Output Gap

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The output gap is the highest since the 1970s suggesting that inflation should be significantly increasing in the coming years. However, can the two indicators both be correct, with there being subdued inflation as measured currently and with the economy above its potential?

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Is Real Fed Funds Rate Peaking?

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Q2 GDP growth was revised higher from 4.1% to 4.2% even though the estimate for real consumption growth was revised lower from 4% to 3.8%. That being said, the consumer had a strong rebound from Q1 and still drove GDP growth to an amazing result. The obvious question is whether…CONTINUE READING

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