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Tag Archives: Economics

Previous Employment Concerns Becoming An Ugly Reality

“Every financial crisis, market upheaval, major correction, recession, etc. all came from one thing – an exogenous event that was not forecast or expected. This is why bear markets are always vicious, brutal, devastating, and fast. It is the exogenous event, usually credit-related, which sucks the liquidity out of the market, causing prices to plunge. As prices fall, investors begin to panic-sell driving prices lower which forces more selling in the market until, ultimately, sellers are...

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Shedlock: Recession Will Be Deeper Than The Great Financial Crisis

Economists at IHS Markit downgraded their economic forecast to a deep recession. Please consider COVID-19 Recession to be Deeper Than That of 2008-2009 Our interim global forecast is the second prepared in March and is much more pessimistic than our 17 March regularly scheduled outlook. It is based on major downgrades to forecasts of the US economy and oil prices. The risks remain overwhelmingly on the downside and further downgrades are almost assured.IHS Markit now believes the...

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The Lay of the Land

The markets are an incredible aggregator of information.  The corona crisis has denied grist to the mill.  With so many unknowns, it is as if investors latched on to the US fiscal debate.  A camel, it is said, is a horse made in committee, and so too with the laborious legislative process of the American republic. When everything is said and done, more is often said than done.  However, this time is different.  Leaving aside the response to the public health emergency, G-10...

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How COVID-19 May Move Markets

As the pandemic drives markets to the 2018 lows, certain relationships in trends between the markets and the COVID-19 virus are evident.  As social distancing increases, markets continue to fall. So, by looking at the expected breakout levels of the virus, we can assess possible market reactions. The chart below shows the inverse correlation between the expected peaks of the virus and potential lows in the markets:  Source: FIPhysician – & Patrick Hill  – 3/18/20 In the...

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23/3/20: Private Consumption Gets the Virus. Heads to an ICU…

Via @bkollmeyer, Deutsche Bank's Research chart on discretionary spending across the global economy: I have no access to the primary data on this, but if the chart is true, the global economy is 'borked'. One notable line here is for Ireland. Ireland's economy is heavily dependent on personal consumption expenditure. Here are the latest data:    PC as % of     modified     total    demand        PC as %          of GNI*     1995-199958.857.6     2000-200754.755.2200754.156.7   ...

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#WhatYouMissed On RIA This Week: 03-20-20

We know you get busy and don’t check our website as often as you might like. Plus, with so much content being pushed out every week from the RIA Team, we thought we would send you a weekly synopsis of everything you might have missed. ________________________________________________________________________________ ________________________________________________________________________________ RIA Pro is our premium investment analysis, research, and data...

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Shedlock: Fed Trying To Save The Bond Market As Unemployment Explodes

Bond market volatility remains a sight to behold, even at the low end of the curve. Bond Market Dislocations Remain The yield on a 3-month T-Bill fell to 1.3 basis points then surged to 16.8 basis points in a matter of hours. The yield then quickly crashed to 3 basis points and now sits at 5.1 basis points. The Fed is struggling even with the low end of the Treasury curve. $IRX 3-Month Yield Stockcharts shows the 3-month yield ($IRX) dipping below zero but Investing.Com does...

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