It’s becoming more and more difficult to be in the fossil fuel business. On both sides of the Atlantic, lawmakers and unelected bureaucrats are turning up the heat, so to speak, on companies over the issue of climate change.
We don’t disagree the S&P 500 could well hit a target of 5000. But, let us be honest about the reasons why...
The bond market has been in hibernation for months, and investors may have become complacent about risks.
It's been a good year for U.S. stocks, but is the run nearing an end?
On September 3, 2021, Prime Minister Yoshihide Suga announced his decision to not run in the upcoming ruling Liberal Democratic Party leadership race later this month. Portfolio Manager Shuntaro Takeuchi provides his thoughts on the current political environment and outlook for Japanese equities.
Major central banks are exploring digital currencies, which seem likely to become a mainstay of tomorrow’s economy. As policymakers wrestle with the many moving parts of digital dollars, euros and yuan, their decisions will shape the next dimension in national currency—and could reshuffle international currency leadership.
The Northern Trust Economics team shares its outlook for the U.S. economy.
Month-over-month nominal sales in August was up 0.71% and up 15.1% YoY. Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, increased by 0.43% and was up 9.4% YoY.
The Census Bureau's Advance Retail Sales Report for August was released this morning. Headline sales came in at 0.71% month-over-month to two decimals and was above the Investing.com forecast of -0.8%. Core sales (ex Autos) came in at 1.81% MoM.
This morning's seasonally adjusted 332K new claims, up 20K from the previous week's revised figure, was above the Investing.com forecast of 330K.
The latest Manufacturing Index came in at 30.7, up 11.3 from last month's 19.4. The 3-month moving average came in at 24.0, down from last month. Since this is a diffusion index, negative readings indicate contraction, positive ones indicate expansion. The Six-Month Outlook came in at 20, down 13.7 from the previous month's 33.7.
Over the past 70 years, rising government debt generally has been accompanied by weaker economic activity. But it’s not a simple relationship.
We’ve all experienced shortages of various goods and/or services in the last year or so of the coronavirus pandemic. In recent decades, American manufacturers have increasingly outsourced the production of goods we consume to foreign countries where they can often be produced cheaper.
Europe still needs fiscal support to preserve stability and growth.
Here is a table showing the annualized change in Headline and Core CPI, not seasonally adjusted, for each of the past six months. Also included are the eight components of Headline CPI and a separate entry for Energy, which is a collection of sub-indexes in Housing and Transportation. We can make some inferences about how inflation is impacting our personal expenses depending on our relative exposure to the individual components.
This morning we got the latest Empire State Manufacturing Survey. The diffusion index for General Business Conditions at 34.3 was an increase of 16 from the previous month's 18.3. The Investing.com forecast was for a reading of 18.
We've updated this series to include the August release of the Consumer Price Index as the deflator and the monthly employment update. The latest hypothetical real (inflation-adjusted) annual earnings are at $44,443, down 6.5% from 45-plus years ago.
COVID-19 has increased inequality and aggravated social problems across emerging market economies, fueling populist pressures—but several emerging countries share features that make them particularly vulnerable. Assessing key environmental, social and governance (ESG) metrics can help identify potential pressure points.
The U.S. Congress faces major financial deadlines in the month ahead.
Let's do some analysis of the Consumer Price Index, the best-known measure of inflation. The Bureau of Labor Statistics (BLS) divides all expenditures into eight categories and assigns a relative size to each. The pie chart illustrates the components of the Consumer Price Index for Urban Consumers, the CPI-U.
The public wants prophets. The historian writes stories about the past, but what the public wants is the history of the future. This leads to a paradox.
In the U.S., a four-year degree is increasingly a “talisman” against deaths related to suicide and economic hardship, according to a new research paper that offers a stark verdict on the current economy.
The Bureau of Labor Statistics released the August Consumer Price Index data this morning. The year-over-year non-seasonally adjusted Headline CPI came in at 5.25%, down from 5.37% the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 4.00%, down from 4.27% the previous month and above the Fed's 2% PCE target.
The headline number for August came in at 100.1, up 0.4 from the previous month. The index is at the 57th percentile in this series.
Seven out of eight indexes on our world watch list posted gains through September 13, 2021. The top performer is India's BSE SENSEX with a gain of 21.83%, France's CAC 40 is in second is with a gain of 20.27%, and our own S&P 500 is in third with a gain of 18.97%. Coming in last is Hong Kong's Hang Seng with a loss of 5.20%.
Is this new socially aware investment strategy all it’s cracked up to be?
Among the most persistent questions I hear is why we don’t just adapt to the reality that the Federal Reserve will never again “allow” the market to experience a serious decline. The problem with this view is that it rests on the premise that Federal Reserve policy supports the market in a clear-cut and mechanical way, when its effectiveness actually relies on the speculative psychology of investors.
Evergrande is an example of the risk of debt defaults to China's financial stability.
Value has its day in the sun. But are investors learning the right lessons from it?
Disruptions and dislocations associated with COVID-19 mean current economic data may not be a reliable guide to the future. But by turning to the past, we find compelling evidence that inflation regime change is accelerating.
Our high yield corporate credit team has been monitoring how inflation is impacting various market sectors, with an eye on four factors: input cost inflation, pricing power, impact to earnings and repricing vulnerability.
On the latest edition of Market Week in Review, Senior Portfolio Manager Megan Roach and Julie Zhang, head of North America sales enablement and analytics, discussed the latest data on U.S. jobs and wages, recent central bank actions and the state of the global economic recovery.
Today I’m going to look at several possible futures. There are forces at work in both Congress and the Federal Reserve that could take us down radically different paths. There are also changes in the Zeitgeist, the way we act and think both in and as a society, that are going to have major impacts.
So much of life is managing risk. That’s true on a micro, personal-level scale as well as a macro, country-level scale. Crises often can’t be prevented. It’s how you deal with them that makes all the difference.
Markets now know that the taper can be divorced from interest rate hikes. But for how long? What are your expectations on the timing of tapering?
This morning's release of the August Producer Price Index (PPI) for Final Demand was at 0.7% month-over-month seasonally adjusted, down from a 1.0% increase last month. It is at 8.3% year-over-year, up from 7.8% last month, on a non-seasonally adjusted basis. Core Final Demand (less food and energy) came in at 0.6% MoM, also down 1.0% from the previous month and is up 6.7% YoY NSA. Investing.com MoM consensus forecasts were for 0.6% headline and 0.5% core.
When it comes to questions about inflation, growth, and the impacts of vaccination rates on global economies, many of us are asking: what’s next? Our Head of the Franklin Templeton Investment Institute, Stephen Dover, and five economists from Franklin Templeton’s specialist investment teams discuss the current environment and how it shapes their views on the path forward.
We've updated our monthly workforce analysis to include the latest Employment Report for August. The unemployment rate dropped to 5.2%, and the number of new nonfarm jobs (a relatively volatile number subject to extensive revisions) came in at 235K.
In this session, we explore how President Biden’s proposed tax plan would impact businesses and individuals, and how municipal bonds can help mitigate overall portfolio risk.
In this webinar you will learn:
Each year, the Social Security Board of Trustees releases a report which analyzes the current and projected financial health of Social Security and Medicare. We should all care about what the annual reports say because these programs provide essential benefits for seniors. The latest and previous reports have issued dire warnings of coming benefit shortfalls.
We have argued for years that the biggest mistake being made by Berkshire Hathaway was not giving shareholders access to the thoughts and investment discipline of their two talented stock pickers, Ted Weschler and Todd Combs. After all, Buffett calls the shareholders “partners” and has not allowed his partners to understand anything about the strategies and results of upwards of $30 billion of shareholder capital.
We believe global growth in 2021 will remain strong, though a grand global reopening looks increasingly unlikely. The spread of the COVID-19 delta variant may limit a return to normalcy and full employment. We believe the next few months will be critical for determining the economic trajectory in 2022. Read on for a visual snapshot of our GDP growth expectations around the globe.
The latest JOLTS report (Job Openings and Labor Turnover Summary), with data through July, is now available.
Uncertainty always exists in financial markets.
Let's take a closer look at Friday's employment report numbers on Full and Part-Time Employment.
The latest monthly employment report showed a gain of 235K nonfarm jobs, which consists of a gain of 195K service-providing jobs and a gain of 40K goods-producing jobs.
Household savings and central bank policies have reduced the need for credit.
Millennials are striving to make a difference with their money, which is why faith- and values-based investing are an excellent match.
Here is the latest update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month.
Between March and May 2020, Google searches for the term "life insurance” surged by 50%. This swell in interest made sense and drove a profound change in how policies were sold, given that in-person exams and visits were impossible.
This commentary has been updated to include Friday morning's release of Nonfarm Employment. August's 235K increase in total nonfarm payrolls had revisions that resulted in 134K more jobs than previously reported. The Investing.com consensus was for 665K jobs gained and the unemployment rate to fall to 5.2%.
We are in an odd situation where it’s unclear if labor is scarce or abundant. Many employers can’t seem to find enough qualified workers, but the August jobs report said 8.4 million are unemployed and millions more underemployed.
Social Security is in worse shape than we thought. The program’s trust fund is now expected to be insolvent by 2033, a year earlier than anticipated. According to the annual report, its finances have been “significantly affected” by the pandemic and 2020 recession, not to mention “rapid population aging.”
Trucks are a vital link in supply chains, but there aren't enough people to drive them.
It was the sound of glass shattering. I raced around the house searching for broken windows because it was the only thing I could think of in that frazzled moment to explain the clamor.
The Institute of Supply Management (ISM) has now released the August Services Purchasing Managers' Index (PMI). The headline Composite Index is at percent 61.7, down 2.4 from 64.1 last month. Today's number came in above the Investing.com forecast of 61.5 percent.
The August US Services Purchasing Managers' Index conducted by Markit came in at 55.1 percent, down 4.8 from the final July estimate of 59.9.
Investors are increasingly looking outside developed countries for investment opportunities, but it’s important to remember that not all Emerging Market countries are the same. In this report, we compare the opportunities in China & Brazil.
As of the end of August, the index's year-to-date gains exceed 20%.
A single-minded approach to price stability is under threat as policymakers start to focus on what are—arguably—more pressing concerns.
The U.S. International Trade in Goods and Services, also known as the FT-900, is published monthly by the Bureau of Economic Analysis with data going back to 199 and details U.S. exports and imports of goods and services. Today's headline number of -70.05B was better than the -71.00B Investing.com forecast.
Business travel as we’ve known it is a thing of the past.
The labeled bond market has seen explosive growth in issuance over the past two years.
Financial literacy is more important now than ever as Americans continue to face financial struggles due to the COVID-19 pandemic. And yet, there is a persistent financial literacy epidemic that threatens the financial futures of millions. Financial advisors can serve as an antidote to this epidemic. My guest Andrew Crowell, is here to talk about how financial literacy programs, like the one that his firm, D.A. Davidson, offers in partnership with the YMCA, can positively impact urban communities and set teenagers up for financial success.
A properly diversified credit portfolio should have exposure to both high-yield corporate bonds and bank loans.
It was Sunday night on Aug. 15, 1971, and many Americans were watching television — the most popular show that evening being the Western series “Bonanza.”
This morning the Institute for Supply Management published its monthly Manufacturing Report for August. The latest headline Purchasing Managers Index (PMI) was 59.9, an increase of 0.4 from 59.5 the previous month and in expansion territory. Today's headline number was above the Investing.com forecast of 58.6 percent.
The August US Manufacturing Purchasing Managers' Index conducted by Markit came in at 61.1, down from the final July figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
Behavioral economics is facing a reckoning.
The headline number of 113.8 was a decrease of 11.3 from the final reading of 125.1 for July. This was below the Investing.com consensus of 124.0.
Here are five cost-effective strategies advisors should use to reach Millennials:
With today's release of the June S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index saw a 1.6% increase month over month which is cut to 1.4% with inflation adjustment. The non-seasonally adjusted national index saw an 18.6% YoY increase.
The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, fell to 66.8 in August from 73.4 in July, which is in expansion territory. Values above 50.0 indicate expanding manufacturing activity.
The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for June. U.S. house prices were up 1.7 percent on a seasonally adjusted nominal basis from the previous month. Year-over-year the index is up 18.8% on a non-seasonally adjusted nominal basis. After adjusting for inflation and seasonality, the index is up 0.52% in June and up 11.3% year-over-year (seasonally adjusted).
There is a growing consensus that the US economy’s inflationary pressures and growth challenges are attributable largely to temporary supply bottlenecks that will be alleviated in due course.
This morning the Dallas Fed released its Texas Manufacturing Outlook Survey (TMOS) for August. The latest general business activity index came in at 9, down 18.3 from 27.3 in July. All figures are seasonally adjusted.
Today the National Association of Realtors released the July data for their Pending Home Sales Index. According to the National Association of Realtors®, "Pending home sales dipped modestly in July, noting two consecutive months of declines."
When do we stop hiding and start accommodating? When do we reach the point where we can attend in-person events, while masked and taking other reasonable precautions?
The country sits atop what could be one of the world’s largest reserves of various metals and minerals, including not just gold but also platinum, silver, copper, iron, aluminum and uranium. It’s believed to have so much lithium, an increasingly important metal that’s widely used in battery technology, that Afghanistan could one day be known as the “Saudi Arabia of lithium,” according to a 2010 memo by the U.S. Department of Defense.
In this edition, Chris Brightman, chief executive officer and chief investment officer of Research Affiliates, explains their outlook on long-term inflation and discusses how investors can prepare for this risk.
With the release of this morning's report on July's Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal 1.08% month-over-month change in disposable income is cut to 0.66% when we adjust for inflation. This is an increase from last month's 0.03% nominal and 0.56% real decreases. The year-over-year metrics are 0.13% nominal and -3.89% real.
Two of the biggest U.S. airlines are taking aggressive measures to ensure that as many employees as possible are inoculated against Covid-19.
Personal Income (excluding Transfer Receipts) in July rose 0.7% and is up 8.2% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, Real Personal Income (excluding Transfer Receipts) MoM was up 0.23%. The real number is up 3.8% year-over-year.
One of the most worrisome risks for state and local governments just got a little more manageable.
It’s no secret. The highly transmissible delta variant of Covid-19 has stalled the recovery of commercial air travel and weakened bookings in July and August, which have traditionally been among airlines’ busiest months of the year.
The accompanying chart is a way to visualize real GDP change since 2007 and uses stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics.
The Second Estimate for Q2 GDP came in at 6.6% (6.56% to two decimals), up from 6.3% (6.28% to two decimals) in Q1 2021. With a per-capita adjustment, the headline number is lower at 6.30% to two decimal points.
The latest index came in at 29, down 1 from last month's 30, indicating expansion in August. The future outlook increased to 36 this month from 33. Here is a snapshot of the complete Kansas City Fed Manufacturing Survey.
With the delta variant of Covid-19 spreading across the U.S., some colleges are seeing a pickup in deferrals from international students as the worsening public-health situation adds uncertainty for those already struggling to secure flights and visas.
COVID-19: Coronavirus Coverage
Fossil Fuels Are Under Siege. Is Misinformation to Blame?
It’s becoming more and more difficult to be in the fossil fuel business. On both sides of the Atlantic, lawmakers and unelected bureaucrats are turning up the heat, so to speak, on companies over the issue of climate change.
Wall Street Sets Its Sights On S&P 5000
We don’t disagree the S&P 500 could well hit a target of 5000. But, let us be honest about the reasons why...
Is the Treasury Bond Market About to Wake Up?
The bond market has been in hibernation for months, and investors may have become complacent about risks.
Taking Stock: Q4 2021 Equity Market Outlook
It's been a good year for U.S. stocks, but is the run nearing an end?
Japan Elections and Market Update
On September 3, 2021, Prime Minister Yoshihide Suga announced his decision to not run in the upcoming ruling Liberal Democratic Party leadership race later this month. Portfolio Manager Shuntaro Takeuchi provides his thoughts on the current political environment and outlook for Japanese equities.
New Frontiers: Central Banks Pursue Digital Currencies
Major central banks are exploring digital currencies, which seem likely to become a mainstay of tomorrow’s economy. As policymakers wrestle with the many moving parts of digital dollars, euros and yuan, their decisions will shape the next dimension in national currency—and could reshuffle international currency leadership.
U.S. Economic Outlook, September 2021
The Northern Trust Economics team shares its outlook for the U.S. economy.
The Big Four: August Real Retail Sales Up 0.7%
Month-over-month nominal sales in August was up 0.71% and up 15.1% YoY. Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, increased by 0.43% and was up 9.4% YoY.
Retail Sales Up 0.7% in August, 15.1% YoY
The Census Bureau's Advance Retail Sales Report for August was released this morning. Headline sales came in at 0.71% month-over-month to two decimals and was above the Investing.com forecast of -0.8%. Core sales (ex Autos) came in at 1.81% MoM.
Weekly Unemployment Claims: Up 20K
This morning's seasonally adjusted 332K new claims, up 20K from the previous week's revised figure, was above the Investing.com forecast of 330K.
Philly Fed Mfg Index: "Current Indicators Remain Elevated"
The latest Manufacturing Index came in at 30.7, up 11.3 from last month's 19.4. The 3-month moving average came in at 24.0, down from last month. Since this is a diffusion index, negative readings indicate contraction, positive ones indicate expansion. The Six-Month Outlook came in at 20, down 13.7 from the previous month's 33.7.
Will Rising Federal Debt Slow Economic Growth?
Over the past 70 years, rising government debt generally has been accompanied by weaker economic activity. But it’s not a simple relationship.
The Renaissance In U.S. Manufacturing & Productivity
We’ve all experienced shortages of various goods and/or services in the last year or so of the coronavirus pandemic. In recent decades, American manufacturers have increasingly outsourced the production of goods we consume to foreign countries where they can often be produced cheaper.
What Next for Europe’s Fiscal Rules?
Europe still needs fiscal support to preserve stability and growth.
Inflation: The Components
Here is a table showing the annualized change in Headline and Core CPI, not seasonally adjusted, for each of the past six months. Also included are the eight components of Headline CPI and a separate entry for Energy, which is a collection of sub-indexes in Housing and Transportation. We can make some inferences about how inflation is impacting our personal expenses depending on our relative exposure to the individual components.
Empire State Mfg Survey: Swift Growth in September
This morning we got the latest Empire State Manufacturing Survey. The diffusion index for General Business Conditions at 34.3 was an increase of 16 from the previous month's 18.3. The Investing.com forecast was for a reading of 18.
Middle-Class Wages in August 2021
We've updated this series to include the August release of the Consumer Price Index as the deflator and the monthly employment update. The latest hypothetical real (inflation-adjusted) annual earnings are at $44,443, down 6.5% from 45-plus years ago.
How Populism May Sway Policies in Emerging Markets
COVID-19 has increased inequality and aggravated social problems across emerging market economies, fueling populist pressures—but several emerging countries share features that make them particularly vulnerable. Assessing key environmental, social and governance (ESG) metrics can help identify potential pressure points.
Fiscal Policy: A September To Remember
The U.S. Congress faces major financial deadlines in the month ahead.
Components of the CPI: August 2021
Let's do some analysis of the Consumer Price Index, the best-known measure of inflation. The Bureau of Labor Statistics (BLS) divides all expenditures into eight categories and assigns a relative size to each. The pie chart illustrates the components of the Consumer Price Index for Urban Consumers, the CPI-U.
Sept. 11 and the Future of American History: Niall Ferguson
The public wants prophets. The historian writes stories about the past, but what the public wants is the history of the future. This leads to a paradox.
‘Deaths of Despair’ Worsen Among Americans Lacking College Degrees
In the U.S., a four-year degree is increasingly a “talisman” against deaths related to suicide and economic hardship, according to a new research paper that offers a stark verdict on the current economy.
Consumer Price Index: July Core at 4%
The Bureau of Labor Statistics released the August Consumer Price Index data this morning. The year-over-year non-seasonally adjusted Headline CPI came in at 5.25%, down from 5.37% the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 4.00%, down from 4.27% the previous month and above the Fed's 2% PCE target.
NFIB Small Business Survey: "Small Business Optimism Increased Slightly in August"
The headline number for August came in at 100.1, up 0.4 from the previous month. The index is at the 57th percentile in this series.
World Markets Update: September 13, 2021
Seven out of eight indexes on our world watch list posted gains through September 13, 2021. The top performer is India's BSE SENSEX with a gain of 21.83%, France's CAC 40 is in second is with a gain of 20.27%, and our own S&P 500 is in third with a gain of 18.97%. Coming in last is Hong Kong's Hang Seng with a loss of 5.20%.
How to Address Common Objections to ESG Investing
Is this new socially aware investment strategy all it’s cracked up to be?
Maladaptive Beliefs
Among the most persistent questions I hear is why we don’t just adapt to the reality that the Federal Reserve will never again “allow” the market to experience a serious decline. The problem with this view is that it rests on the premise that Federal Reserve policy supports the market in a clear-cut and mechanical way, when its effectiveness actually relies on the speculative psychology of investors.
China's Debts Are Coming Due
Evergrande is an example of the risk of debt defaults to China's financial stability.
Fundamentals of RAE: Deep Value, Bubble Stocks, and Market Inefficiency
Value has its day in the sun. But are investors learning the right lessons from it?
When Will Inflation Lift Off?
Disruptions and dislocations associated with COVID-19 mean current economic data may not be a reliable guide to the future. But by turning to the past, we find compelling evidence that inflation regime change is accelerating.
High Yield Bonds in View: The Impact of Inflation
Our high yield corporate credit team has been monitoring how inflation is impacting various market sectors, with an eye on four factors: input cost inflation, pricing power, impact to earnings and repricing vulnerability.
A Worker’s Market: U.S. Job Openings Hit All-Time High
On the latest edition of Market Week in Review, Senior Portfolio Manager Megan Roach and Julie Zhang, head of North America sales enablement and analytics, discussed the latest data on U.S. jobs and wages, recent central bank actions and the state of the global economic recovery.
The Return of Stagflation
Today I’m going to look at several possible futures. There are forces at work in both Congress and the Federal Reserve that could take us down radically different paths. There are also changes in the Zeitgeist, the way we act and think both in and as a society, that are going to have major impacts.
Remembering 9/11 on the 20th Anniversary
So much of life is managing risk. That’s true on a micro, personal-level scale as well as a macro, country-level scale. Crises often can’t be prevented. It’s how you deal with them that makes all the difference.
Fixed Income Market Update
Markets now know that the taper can be divorced from interest rate hikes. But for how long? What are your expectations on the timing of tapering?
August Producer Price Index: Core Final Demand Up 0.6% MoM
This morning's release of the August Producer Price Index (PPI) for Final Demand was at 0.7% month-over-month seasonally adjusted, down from a 1.0% increase last month. It is at 8.3% year-over-year, up from 7.8% last month, on a non-seasonally adjusted basis. Core Final Demand (less food and energy) came in at 0.6% MoM, also down 1.0% from the previous month and is up 6.7% YoY NSA. Investing.com MoM consensus forecasts were for 0.6% headline and 0.5% core.
Quick Thoughts: The Growth and Inflation Argument Continues
When it comes to questions about inflation, growth, and the impacts of vaccination rates on global economies, many of us are asking: what’s next? Our Head of the Franklin Templeton Investment Institute, Stephen Dover, and five economists from Franklin Templeton’s specialist investment teams discuss the current environment and how it shapes their views on the path forward.
COVID-19 Tracker
U.S. Workforce: August 2021 Update
We've updated our monthly workforce analysis to include the latest Employment Report for August. The unemployment rate dropped to 5.2%, and the number of new nonfarm jobs (a relatively volatile number subject to extensive revisions) came in at 235K.
The Biden Tax Plan and Opportunities in Municipals
In this session, we explore how President Biden’s proposed tax plan would impact businesses and individuals, and how municipal bonds can help mitigate overall portfolio risk.
In this webinar you will learn:
Social Security Trust Fund Insolvent By 2033, Really?
Each year, the Social Security Board of Trustees releases a report which analyzes the current and projected financial health of Social Security and Medicare. We should all care about what the annual reports say because these programs provide essential benefits for seniors. The latest and previous reports have issued dire warnings of coming benefit shortfalls.
Berkshire: Pinch Hit Weschler
We have argued for years that the biggest mistake being made by Berkshire Hathaway was not giving shareholders access to the thoughts and investment discipline of their two talented stock pickers, Ted Weschler and Todd Combs. After all, Buffett calls the shareholders “partners” and has not allowed his partners to understand anything about the strategies and results of upwards of $30 billion of shareholder capital.
Global GDP Themes and Forecasts (Infographic)
We believe global growth in 2021 will remain strong, though a grand global reopening looks increasingly unlikely. The spread of the COVID-19 delta variant may limit a return to normalcy and full employment. We believe the next few months will be critical for determining the economic trajectory in 2022. Read on for a visual snapshot of our GDP growth expectations around the globe.
Job Openings & Labor Turnover: July 2021 Update
The latest JOLTS report (Job Openings and Labor Turnover Summary), with data through July, is now available.
Flexible Fixed Income: How to Navigate the Challenges of 2021 and Beyond
Uncertainty always exists in financial markets.
Full-time and Part-time Employment: A Deeper Look
Let's take a closer look at Friday's employment report numbers on Full and Part-Time Employment.
August Employment: Services Vs. Goods Producing Jobs
The latest monthly employment report showed a gain of 235K nonfarm jobs, which consists of a gain of 195K service-providing jobs and a gain of 40K goods-producing jobs.
This Expansion Doesn't Get A Lot Of Credit
Household savings and central bank policies have reduced the need for credit.
How to Engage the Next Generation of Faith-Based Investors
Millennials are striving to make a difference with their money, which is why faith- and values-based investing are an excellent match.
P/E10: August 2020 Update
Here is the latest update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month.
COVID Changed How Life Insurance is Sold
Between March and May 2020, Google searches for the term "life insurance” surged by 50%. This swell in interest made sense and drove a profound change in how policies were sold, given that in-person exams and visits were impossible.
The Big Four Economic Indicators: August Employment
This commentary has been updated to include Friday morning's release of Nonfarm Employment. August's 235K increase in total nonfarm payrolls had revisions that resulted in 134K more jobs than previously reported. The Investing.com consensus was for 665K jobs gained and the unemployment rate to fall to 5.2%.
Human Capital Losses
We are in an odd situation where it’s unclear if labor is scarce or abundant. Many employers can’t seem to find enough qualified workers, but the August jobs report said 8.4 million are unemployed and millions more underemployed.
When Will Social Security Run Dry? Sooner Than You Might Think
Social Security is in worse shape than we thought. The program’s trust fund is now expected to be insolvent by 2033, a year earlier than anticipated. According to the annual report, its finances have been “significantly affected” by the pandemic and 2020 recession, not to mention “rapid population aging.”
Trucking Is In The Slow Lane
Trucks are a vital link in supply chains, but there aren't enough people to drive them.
Sump Pumps and Wet Vacs Are Climate Change Must-Haves: Tara Lachapelle
It was the sound of glass shattering. I raced around the house searching for broken windows because it was the only thing I could think of in that frazzled moment to explain the clamor.
ISM Services Report: August Shows 17 Service Industries Reported Growth
The Institute of Supply Management (ISM) has now released the August Services Purchasing Managers' Index (PMI). The headline Composite Index is at percent 61.7, down 2.4 from 64.1 last month. Today's number came in above the Investing.com forecast of 61.5 percent.
July Markit Services PMI: Slowest Rise in Activity This Year
The August US Services Purchasing Managers' Index conducted by Markit came in at 55.1 percent, down 4.8 from the final July estimate of 59.9.
China vs. Brazil
Investors are increasingly looking outside developed countries for investment opportunities, but it’s important to remember that not all Emerging Market countries are the same. In this report, we compare the opportunities in China & Brazil.
S&P 500 Dispels “Sell in May” Myth With Strong Summer Gains
As of the end of August, the index's year-to-date gains exceed 20%.
What’s the Policy Playbook for the Inflation Endgame?
A single-minded approach to price stability is under threat as policymakers start to focus on what are—arguably—more pressing concerns.
July Trade Deficit at $70.1B
The U.S. International Trade in Goods and Services, also known as the FT-900, is published monthly by the Bureau of Economic Analysis with data going back to 199 and details U.S. exports and imports of goods and services. Today's headline number of -70.05B was better than the -71.00B Investing.com forecast.
‘Forever Changed’: CEOs Are Dooming Business Travel — Maybe for Good
Business travel as we’ve known it is a thing of the past.
What’s Powering The Surge In Labeled Bond Issuance?
The labeled bond market has seen explosive growth in issuance over the past two years.
Improving Financial Literacy in the U.S.
Financial literacy is more important now than ever as Americans continue to face financial struggles due to the COVID-19 pandemic. And yet, there is a persistent financial literacy epidemic that threatens the financial futures of millions. Financial advisors can serve as an antidote to this epidemic. My guest Andrew Crowell, is here to talk about how financial literacy programs, like the one that his firm, D.A. Davidson, offers in partnership with the YMCA, can positively impact urban communities and set teenagers up for financial success.
Looking at Yields in High-Yield Credit
A properly diversified credit portfolio should have exposure to both high-yield corporate bonds and bank loans.
50 Years After Going Off Gold, the Dollar Must Go for Crypto: Niall Ferguson
It was Sunday night on Aug. 15, 1971, and many Americans were watching television — the most popular show that evening being the Western series “Bonanza.”
August ISM Manufacturing Index: Continued Struggle To Meet Heightened Demand
This morning the Institute for Supply Management published its monthly Manufacturing Report for August. The latest headline Purchasing Managers Index (PMI) was 59.9, an increase of 0.4 from 59.5 the previous month and in expansion territory. Today's headline number was above the Investing.com forecast of 58.6 percent.
August Markit Manufacturing: "Improvement in Operating Conditions"
The August US Manufacturing Purchasing Managers' Index conducted by Markit came in at 61.1, down from the final July figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
Behavioral Economics Doesn't Have to Be a Total Loss: Allison Schrager
Behavioral economics is facing a reckoning.
Consumer Confidence Fell in August
The headline number of 113.8 was a decrease of 11.3 from the final reading of 125.1 for July. This was below the Investing.com consensus of 124.0.
Five Cost-Effective Strategies to Reach Millennials
Here are five cost-effective strategies advisors should use to reach Millennials:
June S&P/Case-Shiller Home Price Index: National Index up 18.6% YoY, Continues Record Highs
With today's release of the June S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index saw a 1.6% increase month over month which is cut to 1.4% with inflation adjustment. The non-seasonally adjusted national index saw an 18.6% YoY increase.
Chicago PMI Fell in August
The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, fell to 66.8 in August from 73.4 in July, which is in expansion territory. Values above 50.0 indicate expanding manufacturing activity.
FHFA House Price Index: Up 1.6% in June, All Time High
The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for June. U.S. house prices were up 1.7 percent on a seasonally adjusted nominal basis from the previous month. Year-over-year the index is up 18.8% on a non-seasonally adjusted nominal basis. After adjusting for inflation and seasonality, the index is up 0.52% in June and up 11.3% year-over-year (seasonally adjusted).
The Stagflation Threat Is Real
There is a growing consensus that the US economy’s inflationary pressures and growth challenges are attributable largely to temporary supply bottlenecks that will be alleviated in due course.
August Dallas Fed Manufacturing
This morning the Dallas Fed released its Texas Manufacturing Outlook Survey (TMOS) for August. The latest general business activity index came in at 9, down 18.3 from 27.3 in July. All figures are seasonally adjusted.
Pending Home Sales Down in July
Today the National Association of Realtors released the July data for their Pending Home Sales Index. According to the National Association of Realtors®, "Pending home sales dipped modestly in July, noting two consecutive months of declines."
When and How Do We Return to Normalcy?
When do we stop hiding and start accommodating? When do we reach the point where we can attend in-person events, while masked and taking other reasonable precautions?
Afghanistan Is Sitting on a Gold Mine. Literally.
The country sits atop what could be one of the world’s largest reserves of various metals and minerals, including not just gold but also platinum, silver, copper, iron, aluminum and uranium. It’s believed to have so much lithium, an increasingly important metal that’s widely used in battery technology, that Afghanistan could one day be known as the “Saudi Arabia of lithium,” according to a 2010 memo by the U.S. Department of Defense.
All Asset All Access: Evaluating and Managing Long‑Term Inflation Risks
In this edition, Chris Brightman, chief executive officer and chief investment officer of Research Affiliates, explains their outlook on long-term inflation and discusses how investors can prepare for this risk.
Real Disposable Income Per Capita Inches Up in July
With the release of this morning's report on July's Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal 1.08% month-over-month change in disposable income is cut to 0.66% when we adjust for inflation. This is an increase from last month's 0.03% nominal and 0.56% real decreases. The year-over-year metrics are 0.13% nominal and -3.89% real.
Covid Shots for U.S. Flights Should Be Next Step: Brooke Sutherland
Two of the biggest U.S. airlines are taking aggressive measures to ensure that as many employees as possible are inoculated against Covid-19.
The Big Four: Real Personal Income in July
Personal Income (excluding Transfer Receipts) in July rose 0.7% and is up 8.2% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, Real Personal Income (excluding Transfer Receipts) MoM was up 0.23%. The real number is up 3.8% year-over-year.
Blockbuster Gains Have Public Pensions Dialing Back Projections
One of the most worrisome risks for state and local governments just got a little more manageable.
Airline Stocks Have Been Surprisingly Resilient During the Health Crisis
It’s no secret. The highly transmissible delta variant of Covid-19 has stalled the recovery of commercial air travel and weakened bookings in July and August, which have traditionally been among airlines’ busiest months of the year.
An Inside Look at the GDP Q2 Second Estimate
The accompanying chart is a way to visualize real GDP change since 2007 and uses stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics.
Q2 Real GDP Per Capita: 6.3% Versus the 6.6% Headline Real GDP
The Second Estimate for Q2 GDP came in at 6.6% (6.56% to two decimals), up from 6.3% (6.28% to two decimals) in Q1 2021. With a per-capita adjustment, the headline number is lower at 6.30% to two decimal points.
Kansas City Fed Survey: Manufacturing Strength Continues in August
The latest index came in at 29, down 1 from last month's 30, indicating expansion in August. The future outlook increased to 36 this month from 33. Here is a snapshot of the complete Kansas City Fed Manufacturing Survey.
Foreign Students Begin U.S. College Deferrals as Delta Spreads
With the delta variant of Covid-19 spreading across the U.S., some colleges are seeing a pickup in deferrals from international students as the worsening public-health situation adds uncertainty for those already struggling to secure flights and visas.