Wednesday , June 19 2019
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Tag Archives: Economic growth

Monthly Macro Monitor: Economic Reports

Is recession coming? Well, yeah, of course it is, but whether it is now, six months from now or 2 years from now or even longer is impossible to say right now. Our Jeff Snider has been dutifully documenting all the negativity reflected in the bond and money markets and he is certainly right that things are not moving in the right direction. But moving in the wrong direction, even deeply, as we discovered in 2015/16, doesn’t necessarily mean recession. This slowdown – and...

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How Strong Is The U.S. Economy?

Not as strong as many, including President Trump believes. GDP growth and even the jobs data, including the unemployment rate, though fairly sunny, look deceptively strong and need a deeper look, which we have provided for you over the past few weeks.  See here. How Will The Economy Hold Up As Trade War Escalates? More important, is the U.S. economy so strong it can withstand an escalation in the trade war with China? We seriously doubt it and fully expect Trump will be forced to...

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Monthly Macro Monitor: The Tempest

The Trump administration raised tariffs last week from 10% to 25% on $200 billion worth of Chinese goods and are considering tariffs on another $300 billion of Chinese goods. The Chinese retaliated this morning, raising tariffs to 25% from 5% and 10% on various goods totaling $60 billion. Obviously, the trade negotiations are not going well. Stock markets around the world have fallen as a result, fears of recession rising again as institutional memories of Smoot-Hawley trigger...

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Monthly Macro Chart Review: April 2019

The economic data reported over the last month managed to confirm both that the economy is slowing and that there seems little reason to fear recession at this point. The slowdown is mostly a manufacturing affair – and some of that is actually a fracking slowdown – but consumption has also slowed. On a more positive note, housing seems to have found its footing with lower rates and employment is still fairly robust. The US economic growth rate in this cycle has been disappointing...

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QE – Then, Now, & Why It May Not Work

Since the beginning of the year, the market has rallied sharply. That rally has been fueled by commentary from both the Trump Administration and the Federal Reserve of the removal of obstacles which plagued stocks in 2018. The chart below is an abbreviated, and a bit sarcastic, version of events. While the resolution of the trade war is certainly beneficial to the economy, as it removes an additional tax on consumers, the biggest support for the market has been the assumption the Fed...

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The Fed Doesn’t Target The Market?

Earlier this month, I penned an article asking if we “really shouldn’t worry about the Fed’s balance sheet?” The question arose from a specific statement made by previous New York Federal Reserve President Bill Dudley: “Financial types have long had a preoccupation: What will the Federal Reserve do with all the fixed income securities it purchased to help the U.S. economy recover from the last recession? The Fed’s efforts to shrink its holdings have been blamed for various ills, including...

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The Fed Conundrum – Data Or Markets?

Following the Fed’s last meeting, we published for our RIA PRO subscribers (use code PRO30 for a 30-day free trial) a simple question: “What does the Fed know?” Of course, this meeting followed the stock market plunge at the end of 2018 where their tone that turned from “hawkish” to “dovish” in the span of just a few weeks. Seemingly, despite the previous commentary about concerns over rising inflationary pressures, it was pressure from Wall Street and the White House that quickly “realigned”...

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15/2/19: Euro area is sliding toward recession

Based on the latest data through January 2019, Eurozone’s economic problems are getting worse. In 4Q 2018, Euro area posted real GDP growth of just 0,.2% q/q - matching the print for 3Q 2018. Meanwhile, inflation has fallen from 1.7% in December 2018 to 1.6% in January 2018. And Eurocoin - a leading growth indicator for euro area GDP expansion slipped from 0.42 in December 2018 to 0.31 in January 2019. This marked the third consecutive month of decline in Eurocoin, and the steepest fall in...

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15/2/19: Euro area is sliding toward recession

Based on the latest data through January 2019, Eurozone’s economic problems are getting worse. In 4Q 2018, Euro area posted real GDP growth of just 0,.2% q/q - matching the print for 3Q 2018. Meanwhile, inflation has fallen from 1.7% in December 2018 to 1.6% in January 2018. And Eurocoin - a leading growth indicator for euro area GDP expansion slipped from 0.42 in December 2018 to 0.31 in January 2019. This marked the third consecutive month of decline in Eurocoin, and the steepest fall in...

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