Research & News
Asset Allocation Weekly (December 16, 2016)
by Asset Allocation Committee Equity markets are expensive by numerous measures and have become even more extended in the wake of the “Trump Rally.” As noted in our weekly P/E update (found in the last section of the Daily Comment), our four-quarter measure of the P/E is elevated. Another well-known derivation of the “Buffet Indicator” has… Read More »
Weekly Geopolitical Report – The 2017 Geopolitical Outlook (December 12, 2016)
by Bill O’Grady (This will be the last WGR for 2016. The next report will be published on January 9, 2017.) As is our custom, we close out the current year with our outlook for the next one. This report is less a series of predictions as it is a list of potential geopolitical issues that… Read More »
Asset Allocation Weekly (December 9, 2016)
by Asset Allocation Committee The rapid rise in longer duration Treasury yields since the presidential election has been surprising. As of December 8, the 10-year T-note yield was approximately 2.40%. Although President-elect Trump’s policies will probably be inflationary, it is still unclear how much of his arguably vague plans will get passed. It is possible the… Read More »
Weekly Geopolitical Report – Losing the Philippines: Part 2 (December 5, 2016)
by Bill O’Grady (Next week, we will publish our 2017 Geopolitical Outlook; it will be the last issue of 2016.) In Part 1 of this report, we discussed the geography of the Philippines and examined the nation’s history, focusing on its relations with the U.S. In Part 2 of this report, we will discuss President Rodrigo… Read More »
Asset Allocation Weekly (December 2, 2016)
by Asset Allocation Committee Last week, we discussed the likely implications of President-elect Trump’s policies on the debt markets. This week, we will look at the impact on the dollar. Since the election, the dollar has generally moved higher. Using the Bloomberg dollar index, a broad-based currency measure, the dollar rose nearly 5% after the election. … Read More »
Weekly Geopolitical Report – Losing the Philippines: Part 1 (November 21, 2016)
by Bill O’Grady (There will be no report published over the Thanksgiving holiday. Part 2 of this report will be issued on December 5.) In May, Rodrigo Duterte was elected president of the Philippines, winning 39% of the vote. He is the first resident of the island of Mindanao to hold the office, making him a… Read More »
Asset Allocation Weekly (November 18, 2016)
by Asset Allocation Committee Trumponomics looks as if it will be a combination of fiscal stimulus, trade restrictions and deregulation. It looks very likely that environmental regulations will be reversed and there have been promises of financial deregulation as well. The first two will likely reflate the economy. Proposed deregulation may help hold down energy prices… Read More »
Weekly Geopolitical Report – President Trump: A Preliminary Analysis (November 14, 2016)
by Bill O’Grady On November 8th, Donald Trump shocked the country and the world by defeating Sen. Hillary Clinton in the U.S. presidential race by accumulating a majority in the Electoral College. Mr. Trump, the first president in U.S. history to gain the presidency without having been previously elected to office or served in the military,… Read More »
Asset Allocation Weekly (November 11, 2016)
by Asset Allocation Committee The Trump victory has significant ramifications for the economy and markets. The president-elect’s platform is somewhat ambiguous, which isn’t all that unusual; candidates want to build in some degree of flexibility that a detailed platform can reduce. Despite this lack of clarity, there are elements that are emerging that offer a guide… Read More »
Weekly Geopolitical Report – Inflation Targeting: What’s so special about 2%? (November 7, 2016)
by Kaisa Stucke, CFA Speaking at the Boston FRB conference on October 14th, Fed Chairwoman Janet Yellen indicated that Fed officials are considering the benefits of running a “high pressure economy.” This sparked speculation that the central bank would allow its inflation target to temporarily exceed 2% as the labor market and aggregate demand improve. The… Read More »