Expecting a Market Downturn? Make Sure You’re Following the “Noah Rule”
Predicting a major economic or financial event—whether that’s a recession, market downturn or even your own retirement—requires that you also take action. Otherwise your prediction was meaningless.
Time to Do the Hard Thing
Much of the reaction to last week’s Inflationary Angst letter boiled down to, “Get government out of the way and the free market will work.” Others said the opposite: Government must help people even more than it already does. I wish it were that easy. Neither of those options are what we need, and today I will explain why.
The 2020 Economic Outlook
U.S. economic activity is expected to remain mixed in 2020, with moderate strength in consumer spending and general softness in business fixed investment and manufacturing.
Should You “Sell” Volatility?
Academic theory predicts that the volatility implied by the VIX index will be greater than the realized volatility. That difference can be thought of as an insurance premium investors are willing to pay because volatility tends to spike when stocks crash, as in the last bear market. New research confirms that investors can profit from this and that such a strategy is uncorrelated with other traditional sources of return.
Weekly Unemployment Claims: Up 49K from Last Week, Much Worse Than Forecast
This morning's seasonally adjusted 252K new claims, up 49K from the previous week's unrevised figure, was much worse than the Investing.com forecast of 213K.
Insured municipals offer investors additional assurance
Insured bonds continue to pay interest and principal even if an issuer defaults.
Consumer Price Index: November Headline at 2.05%
The Bureau of Labor Statistics released the November Consumer Price Index data this morning. The year-over-year non-seasonally adjusted Headline CPI came in at 2.05%, up from 1.76% the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 2.32%, up slightly from the previous month's 2.31% and above the Fed's 2% PCE target.
Median Household Incomes by Age Bracket: 1967-2018
We have updated our commentary on household income distribution to include the Census Bureau's release of the 2018 annual data. Our focus was on arithmetic mean (average) household incomes by quintile (and the top 5%) over the 50+ year history of this data series. The analysis offered some fascinating insights into U.S. household incomes. But the classification misses the implications of age for income. Households are by no means locked into the same quintile over time.
Weekly Investment Strategy
Read the latest Weekly Headings by CIO Larry Adam.
Will Outsourcing Improve Profit Margins?
I’m not interested in letting most of my staff go. But I am also not up for adding to staff and therefore expenses.
Quiet Your Ego
If your ego is too loud, it stops you from reaching your goals and having a happier, more fulfilling life.
The November Employment Report
Nonfarm payrolls rose more than expected in the initial estimate for November (+266,000), with upward revisions to the gains for September and October (a net 41,000 higher). In contrast, the ADP estimate of private-sector payrolls rose more modestly (+67,000). What to believe?
We don’t have much time to get our house in order, either in the US or globally. Everything I’ve said today applies, to various degrees, throughout the developed world. Thinking that 2% inflation or zero interest rates coupled with massive deficits will somehow help is beyond wishful thinking.
The Civilian Labor Force, Unemployment Claims and the Business Cycle
What does the ratio of unemployment claims tell us about where we are in the business cycle and our current recession risk? At present, the ratio for Continued Claims has been trending down.
The Big Four Economic Indicators: November Nonfarm Employment
This commentary has been updated to include Friday morning's release of Nonfarm Employment. November's 266K increase in total nonfarm payrolls had revisions that resulted in 41K more jobs than previously reported. The Investing.com consensus was for 186K new jobs and the unemployment rate to remain at 3.6%.