Northern Trust

COVID-19’s path is evident everywhere we look: spending, saving, staffing, sentiment, and sports.

The journey to a full recovery will be a long one, but at least we’ve taken some initial steps.

The challenges keep mounting for global trade, unemployed workers, and banks.

More infections lead to more worry, while the commercial real estate and tourism sectors are put to the test.

Banks undergo a true stress test, smartphones measure movement, and poverty may rise.

Why did unemployment fall? Why is Brexit proceeding? And why did so much food go to waste?

Economic data shows mild improvement, but the road to recovery will be a long one.

Economic factors are motivating recent protests and changes to supply chains.

Faster actions are better in fiscal policy, but that’s not the case for China’s foreign policy.

The pandemic is putting universities and their graduates to the test.

Major economies are easing restrictions to reboot economic activity. Unfortunately, they are faced with a difficult tradeoff between lives and livelihoods.

The absence of a “V-shaped” recovery means trouble for policy makers, mortgage finance, and emerging markets.

The Northern Trust Economics team gives a perspective on a tough outlook for U.S. growth and employment this year.

Policy measures to aid financial markets and labor forces through the crisis are wide-ranging.

Economic activity is expected to recover in the second half of the year, but the shocks in some parts of the world could last for longer.

Economic activity descended in an elevator and will climb back up on the stairs.

Economic data will reveal an incredible downturn.

Many consumers entered the crisis with no cushion.

Decisive measures taken today should help to keep the crisis from causing prolonged damage.

Relief efforts measured in trillions of dollars are bound to have some positive effect.

Growing policy responses reflect greater estimates of the costs of COVID-19.

Growing policy responses reflect greater estimates of the costs of COVID-19.

Substantial fiscal policy is the best economic prescription for COVID-19.

Economic news will get worse before it gets better, but we expect the U.S. economy to pull through.

Can policymakers minimize economic disruptions from COVID-19?

We’ve been closely watching developments related to COVID-19 for the past several weeks. While we have hesitated to make significant changes to our outlook until evidence is clearer, we now expect the economic damage done by the outbreak will be more significant than initially thought.

The coronavirus outbreak is sending ripples through global supply chains and disrupting businesses.

The U.S. economy has been resilient in the face of uncertainty, but risks are growing.

A deep dive into the factors that brought inflation down and are keeping it low.

The U.S. Census is a vital research tool; the coronavirus is a vital risk.

Phase One: A limited deal is better than none.
Inequality: We can’t manage what we can’t measure.
Canada: Taking the lead with fiscal policy.

A strong economy will help U.S. consumers meet their financial resolutions in the new year, while residents of France and Australia have bigger worries.

Tensions between Iran and the United States brings a stressful start to 2020.

Continued modest global growth in 2020 may be the best we can hope for.

Rates were unpredictable, central banks were active, trade was volatile but consumers were undaunted. We reflect on the major economic trends of 2019.

Brexit and trade talks provided lots of uncertainty this year. Last week saw progress on both fronts.

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

Rate cuts and overnight operations were important developments this year. Where will the Fed go from here?

From freight volume to flight delays and real estate to recession risk, we share quick thoughts on a variety of economic subjects.

Overloaded with infinite choices when investing in small caps? Join us to cut through the noise and learn how to determine which fund is the best fit for your client’s portfolio.

In this session, veteran portfolio manager, Robert Bergson, CFA will draw on his own investment strategies to walk you through the importance of small cap value in today’s uncertain market and his approach to the small cap universe.

You will learn:

• Why small caps make sense in uncertain market environments
• Ways to improve the efficiency of your small cap allocations
• How to separate good/compensated risks and bad/uncompensated risks within small cap stocks

In the bond market, staying positive is easier said than done.

China’s economy is slowing by any measure, while Australia’s central bank takes rates to record lows.

Growth Prospects and Challenges Ahead for the U.S., U.K., Eurozone, China, and Japan.

Wealth taxes are politically resonant but difficult to enact. Oil prices are steady despite disruptions, while the EU’s food exports face tariffs.

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

This week’s Fed meeting started a pause in overnight rate cuts. But what will happen if yields on the long end move up?

Are the latest Brexit and GSE proposals the end of the beginning or the beginning of the end?

Deep U.S.-China divisions make a ‘phased’ deal our best hope for trade progress.

Exploring the survey that is the current cause for concern.

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

Testing times for relations in this challenging epoch.

October will be a telling month for Brexit, the eurozone economy and the U.S.-China trade war.

• Automation will squeeze the middle of the labor market.
• Overnight lending markets are finding their equilibrium.
• Japan planned its tax increase to minimize disruption.

Climate change is a risk for the global economy.

Fed is set to ease, ECB eases and mortgage refinancing takes off.

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

What fueled the rise in U.S. employment, and can we sustain it?

The Northern Trust Economics team shares its growth outlook for the U.S., U.K., Eurozone, Japan and China.

Global trade tensions are taking their toll, leaving Europe struggling for solutions.

Unrest in Hong Kong and limitations of monetary policy have no easy solutions.

U.S. consumer confidence is high, but confidence in China’s economic measurements is not.

What shifts from tariffs to currency mean in the US-China trade war.

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

Change can threaten, but it can create opportunity if we adapt.

The Northern Trust Economics team shares its growth outlook for the U.S., U.K., Eurozone, Japan and China.

This week the economics team discusses: Surveying fiscal conditions as the FOMC prepares to meet; Japan gets aggressive in trade with South Korea; and One less fiscal worry for the U.S.

Demand for cars is both slowing and shifting. How will automakers adapt?

The decade of the 1990s in India was an era of rapid change. The sudden rise of new choices and shifts in consumer preferences was stunning, in hindsight.

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

Talks are back on, but success is far from assured.

A change to global uncertainty will require a concrete settlement of key issues . While downside risks to the global outlook have not increased, they haven’t declined, either.

Trade tensions are felt around the world. Cautious central banks and flat yields don't stop a rally in equities. And more observations from a busy half year.

The march of demographics may be slow, but it is sure. And while the consequences of aging may seem far off into the future, they will be substantial. Unless we address them now, they will become much less manageable later.

How much longer can the Fed stay patient? We see a change coming.

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

China and Mexico thought they made progress toward U.S. trade deals. No longer.

The sudden escalation of trade tensions that have originated from Washington is casting doubt over the outlook. If the escalation continues, the global economy will continue to decelerate and recession risks will rise.

Europeans went to the polls, and the results reveal continental divisions. U.S. businesses’ patience for tariffs won’t last. And what do tariffs do to prices?

Productivity growth is vital to the economy and for our well-being. We take a look at recent and long-run trends, marvel at the progress of artificial intelligence, and explore diverging growth among nations.

What’s next for trade talks with China and the U.S.?, Emerging markets face the middle-income trap, CECL provides more insurance for the financial system.

Many factors are holding down inflation, U.S. jobs growth continues to surprise and China’s bad loans are getting worse.

Rumors of a contraction to start the year were overblown. Since March, a string of positive economic headlines have helped soothe investor sentiment and maintain economic momentum. We are still in a growth cycle with room to run.

Wie Gehts mit Deutschland?; Jump-Starting U.S. Startups; Big Data Is Changing Inflation

The economic slowdown that began in late 2018 has started to stabilize. Trade tensions and policy uncertainty took a toll on confidence and financial markets late last year, but both seem less threatening today. Financial conditions have eased as major central banks maintain a fairly accommodative stance amid a subdued inflation outlook.

We expect the USMCA to be ratified eventually. But it could take longer than anticipated, and the political environment across North America creates substantial uncertainty.

Today’s government finances add to tomorrow’s problems; The strong U.S. dollar is a mixed blessing; Prisons are expensive for both taxpayers and inmates

The proposed nominations of Stephen Moore and Herman Cain to the board of governors threaten to compromise the Fed’s strong character. Both have been major fundraisers for the president, and both have pledged to use their posts on the Board to support the White House program. They seem intent on bringing a political agenda into a forum that tries to operate without one.

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

Despite its name, MMT is not modern. It is the latest iteration of the idea of monetizing the debt, relying on a central bank to create demand for a country’s bonds. The Bank of Japan routinely buys all Japanese government bonds on the open market, keeping borrowing costs near zero despite a massive government debt. Japan has not imploded under this debt burden, but it has stagnated. Government intervention reduced a crisis, but did not unlock growth.

Northern Trust’s Economic Research team shares its monthly perspective on the growth prospects and challenges ahead for the U.S., U.K., Eurozone, China, and Japan.

The Expansion’s Endgame?; Latin America: Caught In The Middle; What The Yield Curve Is (And Isn’t) Telling Us

Brexit May-hem; Is the Dot Plot Shot?; Getting Kids to Finish College

A New Normal For The Fed Balance Sheet; How Tariffs Work…and Don't Work; The ECB Goes Back To The TLTRO Well

The Northern Trust Economics team shares our view on growth, inflation, unemployment, and interest rates.

I was born too early to benefit much from Sesame Street, but I still loved The Muppets. Kermit the Frog was my favorite character; alternatively in full control and overwhelmed, Kermit struggled to make sense of the nonsensical. To this day, there are times that I feel confronted with the same challenge.

The U.S. economy has shifted into a lower gear, growth has been falling in the Eurozone, Brexit is festering and China is feeling the heat from internal imbalances and an elevated trade spat with the U.S.

Amazon HQ2 shows the limits of local economic development incentives; China and the U.S. break through a wall in negotiations; and The Fed ponders new approaches to inflation targeting

GSE reform is in sight, China’s stimulus falls short, and bank mergers are back.

The Economics team explores a smooth economic slowdown, elevated consumer confidence, and troubles in Italy.

The U.S. economy is finding its rhythm after an uncertain start to the year.

As we enter tax season, we explore the collection and use of individual income taxes.

Northern Trust’s Economic Research team shares its monthly perspective on the growth prospects and challenges ahead for the U.S., U.K., Eurozone, China, and Japan.

Central banks face a difficult year. Eurozone economies are slowing. And the U.S. government shutdown can’t be ignored.

Weakness in the Chinese economy is becoming clearer, while the way forward for Brexit is anything but clear. And what exactly does "tighter financial conditions" mean?

Markets struggle to price new risks, and the U.S. government shutdown grows in severity.

The U.S. economy will overcome risks and continue to grow in 2019.

Major economies are positioned to keep growing in the year ahead, but risks are mounting.

Six themes emerge as we look back on a busy year of economic news.

Several years into the recovery from the global economic crisis, the jobs of central banks have only become more difficult. How are indebtedness, inequality, inflation and instability contributing to their problems, and what can we expect from future interest rate decisions?

Economic growth will continue, even in volatile markets.

Private, public and international pension plans are all due for a reckoning.

The global economy looks set to move into a lower gear as both advanced and emerging economies will find it hard to extend their recent robust economic performance into 2019.

Senior Economist Ryan Boyle looks at how America accumulated so many student loans, and how best to deal with them going forward.

Dramatic events surrounding Brexit left Theresa May’s government balancing on a precipice. What are the economic implications? Later in the column, we examine U.S. drug prices and possible solutions to exploding costs.

The World Trade Organization plays a crucial role in global trade. How essential is it, and what can we expect as trade tensions rise?

How will the results of the U.S. midterm elections be reflected in trade agreements, legislation and international relations?

With unemployment low and wages rising as we enter the holiday season, consumer spending will continue to lead economic growth.

This week, we evaluate the potential near-term futures of nationalism, inflation, demographic shifts, emerging markets and the effects of prosperity. What trends can we expect to encounter?

Is the International Monetary Fund a useful tool in preventing economic dysfunction? Or, as the nationalists claim, are there more appropriate uses of capital?

With USMCA and Brexit negotiations, nations are reworking the world’s most fundamental trade agreements. How will these new treaties affect global relations?

What do a Nobel Prize, oil prices and employee compensation have in common? Change. The Nobel committee tipped its hat to the importance of recognizing climate change with its prize for Economic Sciences. But changes in oil’s global role and compensation vs. wages are also on our minds

Long-term bond yields are rising amid positive economic data and rising inflation.

Both the U.S. state of Illinois and the nation of Brazil suffer from fiscal deficits that have been years in the making. How can these trends be reversed, and will the upcoming elections for each government contribute to a solution?

Until this year, the global economy had been characterized by three years of strong, synchronized growth with subdued inflation—the “not too hot, not too cold” characteristics of a “Goldilocks” economy. Though global growth is still relatively resilient, inflation risk is clearly on the rise, driven by high commodity prices and tight labor markets.

This week, we look back at EU's recovery from the global financial crisis and the new normal of the US housing market. They have both recovered, but are we on the right path?

This week, the team looks at what’s ahead for the Fed

Reflecting on ten years since the Lehman Brothers bankruptcy: Households have reduced their borrowing, but governments haven’t. Debates over the response to the financial crisis may never end. Non-bank lenders have thrived while managing their risks.

In the span of human history, retirement is a fairly new idea. Only a few generations ago, most of our ancestors could expect to work until the end of their lives. We are happy to report this is no longer the case. Improving longevity brings the opportunity for retirement, but also the responsibility for preparing. Unfortunately, many Americans have not handled this responsibility very well at all.

Northern Trust’s Economic Research team shares its monthly perspective on the growth prospects and challenges ahead for the U.S., U.K., Eurozone, China, and Japan.

The Federal Reserve recently conducted its annual conference in Jackson Hole, Wyoming. Prominent on the agenda were discussions of inflation, or the lack thereof. Many central banks around the world have inflation targets, and have been frustrated by their inability to reach them.

Infrastructure investment promises are politically popular, but actual funding has been slow to follow. Italy’s bridge collapse illustrates the real risks of putting off infrastructure projects. The shortage of truck drivers in the U.S. is driving inflation, and this labor market gap looks likely to last.

This week, the NT Economic team covers the following topics:
- Turkey’s Troubles
- Should countries try to control capital?
- Labor markets work best when there are no guarantees

The economic team looks at the possibility of a bad Brexit.

The U.S. economy is going through a hot summer, but will cool off later this year.

The Northern Trust economics team explores India, recaps revisions to U.S. economic measurements, and gauges potential future economic growth.

The Northern Trust Economics team shares its monthly perspective on the growth prospects and challenges ahead for key markets.

The Northern Trust Economics team tracks China’s fiscal policies and exchange rate volatility, and reacts to recent comments that undermine the Fed’s independence

The Northern Trust Economics team shares its outlook on the Fed’s balance sheet, the world's persistent preference for cash, and the challenge of measuring the gig economy.

The Northern Trust economics team explores agriculture markets globally and in the United States.

The Northern Trust economics team shares its outlook for US economic growth, inflation, unemployment and interest rates.

The Northern Trust Economics team addresses a variety of questions heard most often from our audiences.

The Northern Trust Economics team shares its outlook for growth, employment, inflation, and interest rates in the U.S., U.K., E.U., Japan and China.

The economics team surveys a variety of upcoming events: Mexican elections this weekend, trade battles in the coming months, and LIBOR sunsetting in the years ahead.

The economics team surveys a variety of upcoming events: Mexican elections this weekend, trade battles in the coming months, and LIBOR sunsetting in the years ahead.

China is in focus this week as the economics team considers the country’s trade practices and defaults in its bond market.

What happened at the Fed and the ECB meetings? The economics team explains.

The team illustrates the economic background behind the Korean summit meeting and profiles corporate debt.

Strong growth and employment reports affirm Northern Trust’s positive outlook for U.S. economic performance in the rest of 2018.

The Northern Trust Economics team recaps the circumstances that led to this week’s drama in Italy and investigates a slowdown in U.S. business formation.

Public debt may be growing at the expense of private debt, the Chinese bond market is opening up, and important dates for tariffs are fast approaching.

In this issue, the Economics team looks at current recession risks in the U.S. and eurozone, and explores how rising oil prices will affect U.S. consumers.

The Northern Trust economics team explores the risks of overstretched state and local governments, dramatic actions in Argentina and Turkey, and the recent difficulty of the carry trade.

The Northern Trust Economics team forecasts U.S. economic growth, inflation, unemployment and interest rates.

Oil prices are rising. We explore the causes of this recent trend and the effects it will have on markets across the world.

This week, the economics team takes a look at NAFTA, past and present.

In this issue, the Northern Trust economics team explores the challenges facing Ireland in Brexit, the continuing demand for eurozone debt, and wage growth within U.S. states.

How much debt is too much? [Carl/The Northern Trust Economics team] digests the outlook for debt across countries and levels of government, recaps the most recent outlook for the U.S. fiscal situation, and contrasts China’s current ascendance with the historical example of Japan.

Northern Trust’s economic team recaps recent economic developments and shares our monthly outlook for economic growth, inflation, employment and interest rates in the United States.

Northern Trust’s Economic Research team shares its quarterly perspective on the growth prospects and challenges ahead for the U.S., U.K., Eurozone, China, and Japan.

This issue contains a deeper look into the competitive strategies at play in the current U.S.-China tariff feud, the drivers of the recent upturn in U.S. homeownership, and the market for Japanese government bonds.

One year away from its deadline, Brexit is already shaping up to be an expensive arrangement. Strong U.S. employment makes us question the “natural rate” of unemployment. Do aging populations increase or reduce inflation? Time will tell.

In many respects, economists are a little unusual. We think in odd ways, and we arrange data into odd patterns. We find it hard to reach conclusions without significant equivocation.

We’ve written about the American steel tariffs in each of the last two weeks. But there remain some important points to make on the topic of trade.

We may come to view February 2018 as a turning point for the U.S. economy. For the first nine years of the current expansion, fiscal policy was constrained and trade policy was measured. During the past month, the two have moved with more force, raising important questions about the outlook.

The White House has announced a new set of broad tariffs on steel and aluminum imports. The measure is surprising in its scope, its targets and its break from the long-prevailing trends of international trade.

This week, the White House signaled its intention to place punitive tariffs on imports of steel and aluminum. Markets and analysts reacted quickly, and negatively.

U.S. fiscal policy has become unmoored, and it will be difficult to steer it safely back to shore.

I am a traditionalist when it comes to outdoor cooking: wood and charcoal are the only suitable fuels.

It is said we should be careful what we wish for, because we just might get it. Beginning late last week, stocks finally stepped back. Market declines of 5% and even 10% occur with some regularity, even in the midst of long bull intervals

For several years, the U.S. economy has produced a “Goldilocks” combination (neither too hot nor too cold) of solid growth with limited inflation. The absence of price pressures, even at very low levels of unemployment, has surprised many observers.

Given the events of a decade ago, 2018 promises to be a year filled with reminiscence. Chroniclers will recall the signs of the gathering storm: falling U.S. house prices, rising mortgage defaults and spreading institutional failures.

For more than a year, the U.S. Dollar (USD) has been losing value relative to most other currencies. When asked about this trend this week in Davos, U.S. Secretary of the Treasury Steven Mnuchin seemed unconcerned, and even supportive.

Most central banks have targets, too. And judged solely by the numbers, monetary policy would be assigned a substandard rating.

We’ve been doing some de-cluttering at my house, adapting to life as empty nesters. During a review of some long-forgotten storage bins, I found the very first tax return I ever filed. It listed income of less than $2,000, earned lifeguarding and shelving books at the campus library.

As it is for people, so it is for business cycles, which can become more vulnerable as they continue. This theory will certainly be tested in 2018. The global economy enters this year with considerable momentum and lots of policy support.

The economic news this year could scarcely have been better. Strong growth, low inflation and rising asset prices in major markets will make 2017 one of the most successful years in recent memory.

There has been no let-up to the economic news cycle this year. Even the approach of the holiday season has failed to offer a respite, with tax reform deliberations ongoing through the holidays.

Times have changed, in more ways than one. This December has been especially hectic, with the transition in Brexit negotiations, U.S. tax reform debate and Bitcoin setting new highs every few minutes.

We’re thankful for this year’s economic growth in the U.S., which has exceeded most expectations. A soft first quarter has been followed by two quarters in which real activity expanded at an annual pace exceeding 3%.

Has the stock market gotten too expensive? Overall, we would say it hasn't. But we do feel some sectors are better positioned than others.

The elimination of personal exemptions is one of many features of the tax reform proposal presently being debated in Washington. If passed, the new regime would realign the finances of industries, households and even countries.

This month's forecast follows a wave of generally positive economic data that appeared to shake off the weather-related disruptions seen throughout the summer and early fall.

The current situation in Puerto Rico cannot be fully understood without a bit of a history lesson.

As expected, this month's forecast was a little more difficult to assemble. The influence of severe storms on economic activity and economic data made it harder to discern fundamental trends.

All cultures have the challenge of balancing the past and the present. But nowhere is the contrast between the two more apparent than in the Middle East.

We would do well to heed the teaching of behavioralists as we craft solutions to some of today’s thorniest problems.

The German phrase Sturm und Drang (literally: storm and stress) describes situations that become especially dramatic. This seems an apt expression to describe both the immediate past and the near future for the United States economy.

The eurozone has been the brightest star on this year’s economic horizon. The region’s output expanded at a 2.5% pace during the second quarter and has been rising continuously for 48 consecutive months.

Pharmaceutical costs represent about 10% of total U.S. health care expenditures, or about $325 billion each year.

Supply and demand theories suggest worker scarcity would increase the price paid for labor. This has certainly been the case during recent American expansions, when annual wage gains topped 4%.

Warm temperatures prevail in most of the United States at the moment, a trend that is mirrored in recent economic data. We don't expect conditions to cool as autumn approaches.

Monetary Policy Rules: Revisited and Giving Japan Credit

Global economic activity has generally been good during the first six months of 2017. Europe’s renewed momentum has been a highlight for the developed world, and China’s steady growth has compensated for faltering elsewhere in emerging markets.

Uncertainty about U.S. fiscal policy changes persists. Tax cuts and infrastructure spending proposals are on the table, but they are unlikely to be enacted in 2017. We continue to maintain skepticism about the timing and size of the fiscal policy boost to economic growth. In the meantime, the expansion continues on, unperturbed.

Uncertainty about U.S. fiscal policy changes persists. Tax cuts and infrastructure spending proposals are on the table, but they are unlikely to be enacted in 2017. We continue to maintain skepticism about the timing and size of the fiscal policy boost to economic growth. In the meantime, the expansion continues on, unperturbed.

Seniors and their families approach this milestone with a mix of pride and trepidation. Pride arises from the achievement of heightened status within the community of educated women and men. But there is trepidation about what lies ahead at the next level.

On the surface, China continues to outperform expectations. It has sustained a high rate of economic growth for longer than most other developing countries.

In this commentary we will summarize:

• What Does It Mean To “Buy American?”
• European Populists Lost, But Their Spirit Lives On
• The ECB Is Right To Stand Pat

Incoming “soft data” and “hard data” conveyed vastly different U.S. economic conditions as the first quarter unfolded.

My timing in life is terrible. When I book a flight, cumulus clouds immediately begin plotting to cover the destination on the appointed day. When I plan a special menu for a dinner party, the supermarket runs out of a key ingredient.

Having accumulated a massive portfolio of securities during its quantitative easing (QE) program, the Fed has now arrived at a point where reduction is appropriate. But trimming the weight of monetary accommodation may not be easy.

The Organization of Petroleum Exporting Countries (OPEC) has lost its grip on global production, with the United States (among others) rising to become a significant source of output.

U.S. political issues have dominated the economic headlines for the past month. The failure of the Republican-led House of Representatives to repeal and replace the Affordable Care Act delays consideration of tax reform and infrastructure spending.

Over the last decade, a combination of unprecedented global financial integration and unconventional monetary policy in global financial centers created new challenges for central banks in emerging markets (EM).

The world’s major economies have performed quite well in recent months despite the influence of political and policy upheaval. Brexit and the outcome of the U.S. election have yet to produce the negative outcomes some had feared.

The effort to replace the Affordable Care Act (ACA) was an important test for Washington. Congress had elected to take up this debate first, for both procedural and symbolic reasons.

The Federal Reserve spent a good portion of last year talking tough about raising rates, only to back away at several turns when intimidated by international uncertainty.

The outlook for the U.S. economy is nearly unchanged from expectations at the start of the year. Congress will address tax cuts and infrastructure spending only after passage of an updated health care law.

Today, it seems as if there is a mysterious voice speaking to politicians all over the world, urging them to build.

The economic setting within the United States as the new year commences is largely constructive. Data received in the latter weeks of 2016 were encouraging, and there seems to be an improving economic sentiment.

The first significant U.S. economic release of the new year was a solid one. The U.S. Department of Labor reported this morning that 156,000 new jobs had been created in December.

As the Federal Reserve prepares for its final monetary policy gathering of 2016, it will look back on a year of inactivity and look forward to a year that could very well be an active one.

The U.S. bond market has retreated since the election. Long-term yields have risen by almost 40 basis points. It appears that the 30-year-old bull market in bonds is really over.

Needless to say, the surprise victory of Donald Trump in the U.S. presidential election has changed the economic outlook on many fronts.

A mistake many in my profession have made in the past year has been underestimating the difference between overall economic performance and its translation to the fortunes of constituents. This was at the heart of the Brexit vote last June and was the driving force behind yesterday’s U.S. outcome.

At the three-quarter pole, the global economy is muddling through a disappointing 2016. Growth in developed and emerging markets continues, but at a pace that has fallen short of expectations.

There were concerns throughout the summer that U.S. economic conditions had weakened. Based on incoming reports, though, the weight of economic evidence remains positive.