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Chair Yellen, Where Have You Been? Fed Lowers GDP Forecast Again - Why So Long?
Jun. 22, 2014 • 5 Comments
- As 2014 ticks away, it becomes apparent the GDP would not grow by the Fed's 3.0% forecast rate, yet the Fed did not revise its forecast until just now.
- Once again, the Federal Reserve’s forecast that “stronger growth is right around the corner” (but it doesn’t ever seem to materialize) has become the norm. Markets clearly recognize this.
- Stronger growth remains on the more distant horizon. This, however, is good for those concerned about increased interest rates, as rates are not likely to move higher anytime soon.
The May 2014 Jobs Report - Back To The Starting Line - However, The Blocks Have Been Moved
Jun. 11, 2014 • 4 Comments
- Employers hired 217,000 workers in May 2014, effectively lifting the job numbers to where they were before the financial crisis and recession.
- However, since 2008, the US population grew by almost 15 million. As such, an additional 8+ million jobs must be created to be truly at par with pre-recession levels.
- While jobs were created, the quality of these jobs has diminished. Yet the job numbers will allow the Fed to continue its current trajectory of gradually reducing monthly bond purchases.
- Given the weakness in GDP since the beginning of 2014, it is unlikely that the job situation will get materially better in the coming months. Good news for Fed watchers!
Madame Chair Please Note: There Is Something Brewing On The Horizon
Mar. 23, 2014 • 16 Comments
- US economic growth is slowing, suggesting that the US is at risk of slipping into recession.
- Recessions typically occur every seven to 10 years. Although external or shock events may alter the normal pattern, nonetheless, the timing for a recession is right.
- While the severe weather that blanketed much of the US was certainly a driver behind the drop in certain activity, there are more deep-rooted economic causes.
Investors Take Note: China's 'Lehman Moment' Is Looming, Help Is Not On The Way
- Recent defaults in China are threatening to change investor perceptions of the safety of Chinese investments.
- The weakening property markets in China could slow the Chinese economy and potentially weaken Chinese banks.
- Investors have seen this before with Bear Stearns, Lehman and the Irish Banks, so we know how the book could end.
- Help may not be on the way as it appears that the Chinese government is willing to see defaults as it shifts to a more market-driven economy.
- J.C. Penney Shifts Into Reverse Mode, But It May Be Too Late
- Investors Should Dig Deep And Look Beyond The Standard Economic Statistics
The Norwegian Oil Fund Surges, Investors Should Take Note
Mar. 12, 2013 • 1 Comment
The U.S. Adds 236,000 Jobs, Unemployment Falls To 7.7% - But Do The Numbers Tell The Real Story?
Mar. 8, 2013 • Comment!
Banking Reform: Do We Need More Regulation Or Just Better Regulation?
Jan. 25, 2013 • 5 Comments