Research & News
Weekly Geopolitical Report – Reflections on Domestic Policy and American Hegemony: Part I (April 15, 2019)
by Bill O’Grady (Due to the Easter holiday, our next report will be published April 29.) The dollar is the world’s reserve currency. As such, there is a constant demand for dollars from foreign countries to provide liquidity for global transactions. Because of the reserve currency status, U.S. monetary and fiscal policy affects the world economy… Read More »
Daily Comment (April 15, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Happy Tax Day! It’s a quiet start to a short week. Here is what we are watching: A Chinese anniversary: This is the 30th anniversary of the death of Hu Yaobang, a reformist leader in the late 1980s. Deng had supported the rise of Hu,… Read More »
Asset Allocation Weekly (April 12, 2019)
by Asset Allocation Committee The employment data is closely watched by financial markets; although the data isn’t necessarily a leading indicator for the economy, it is probably the most important from a political and social perspective. Weak employment data is a worry for political incumbents and concerning to policymakers. However, beyond the headline data, there are… Read More »
Daily Comment (April 12, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] We are seeing a risk-on day. Other than this sentence, there will be no discussion of Brexit today. Here is what we are watching: Chinese data: Bank loans rose much more than expected, with CNY 1.69 trillion extended compared to expectations of CNY 1.25 trillion. … Read More »
Daily Comment (April 11, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Lots of news this morning. Here is what we are watching: Assange arrested: The Ecuadorian government has removed Julian Assange’s asylum status and he has been arrested in London.[1] We expect him to eventually be extradited to the U.S.[2] Assange is a controversial figure; Wikileaks… Read More »
Daily Comment (April 10, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] It’s a very quiet morning in front of some important news today. Brexit, the ECB meeting and Fed minutes are all on tap this morning. Here is what we are watching: ECB: The ECB has pushed the first rate hike into next year (and it… Read More »
Daily Comment (April 9, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] It’s a very quiet morning in front of Brexit deadlines. The only economic news of note was weak Chinese car sales (-12.7% in March). Here is what we are watching: BREAKING NEWS: Italy reduces its GDP forecast to 0.1% from 1.0% this year. This action… Read More »
Weekly Geopolitical Report – When Hegemons Fade (April 8, 2019)
by Bill O’Grady In our Daily Comment report, a section on Brexit has become something of a regular feature. As part of keeping up with developments, we have commented on nearly every twist and turn (or lack thereof) in the Brexit process. In a recent WGR series, we discussed the Irish problem[1] and how it relates… Read More »
Daily Comment (April 8, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Happy Monday! Although we are in spring, a massive winter storm is moving over the northern plains and will delay planting in the northern Corn Belt. It will also increase flooding in the major river systems in a couple of weeks. Here is what we… Read More »
Asset Allocation Weekly (April 5, 2019)
by Asset Allocation Committee Mortgage-backed securities have rather odd characteristics compared to Treasuries. At their most basic level, mortgages are bonds—prices are inversely related to yields. The pricing on mortgages assumes a certain level of refinancing activity. However, when yields rise, expected mortgage duration tends to extend because mortgage holders are less likely to refinance. When… Read More »