Research & News
Weekly Geopolitical Report – Reflections on Domestic Policy and American Hegemony: Part II (April 29, 2019)
by Bill O’Grady Two weeks ago, we introduced this report with a review of the basics of the reserve currency and the savings identity. This week, we will examine two important historical analogs, the Nixon and Reagan administrations. #1: The Nixon Analog As President Nixon prepared for the 1972 presidential campaign, he faced a number of… Read More »
Daily Comment (April 29, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Happy Monday! It was a cold weekend in the Midwest, with a late April snow for the upper parts of the nation’s midsection. It’s going to be a busy week, with the FOMC meeting and Japan’s Emperor Akihito taking the rare step of abdication tomorrow.[1] … Read More »
Asset Allocation Weekly (April 26, 2019)
by Asset Allocation Committee One of the age-old problems of analysis is the problem of correlation versus causality. Correlations simply show the degree of relation; the range runs from -1 (perfectly negative) to +1 (perfectly positive). In any introductory statistics class, the instructor will discuss the difference between relation and causality. Here is an example: Although… Read More »
Daily Comment (April 26, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] It’s GDP day! We cover the numbers in detail below, but our quick take is that the data was much stronger than expected, coming in at 3.2%, well above the +2.3% forecast. Here is what we are watching: Disappointing Japan: Although inflation was modestly higher… Read More »
Daily Comment (April 25, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] It’s another mostly quiet morning as a plethora of earnings are released. Here is what we are watching: South Korea goes negative: Real GDP slipped into negative territory in Q1. Weak investment spending led to the unexpected slowdown. Although exports were weak, on a net… Read More »
Keller Quarterly (April 2019)
Letter to Investors The last half-year has demonstrated the day-to-day inscrutability of the financial markets, and with it the impossibility of predicting them. Suppose that last year on September 18 you had the misfortune of bumping your head and, in Rip Van Winkle fashion, fell into an unconscious slumber that lasted exactly seven months. On… Read More »
Daily Comment (April 24, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Markets across the world are rather quiet this morning after U.S. equity indices made new closing highs yesterday. Here is what we are watching: China trade talks: Treasury Secretary Mnuchin and Trade Representative Lighthizer announced another round of meetings in Beijing next week.[1] The next… Read More »
Daily Comment (April 23, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Markets across the world are rather quiet this morning. Oil remains the focus. Here is what we are watching: Oil: Yesterday, the Trump administration announced that no more oil waivers will be granted on Iranian oil exports, which will tighten oil supplies. The U.S. has… Read More »
Daily Comment (April 22, 2019)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Happy Easter Monday! Most of Europe is closed today, along with a few Asian markets (Australia, New Zealand). It’s also Earth Day. There was a horrific terror event Easter Sunday against Christians in Sri Lanka.[1] Here is what we are watching: Oil: The Trump administration… Read More »
Asset Allocation Weekly (April 18, 2019)
by Asset Allocation Committee Why is inflation so low? The persistence of low inflation, despite the long expansion and the decline in unemployment, continues to befuddle policymakers. Standard economic theory suggests there is an inverse relationship between inflation and unemployment. When the unemployment rate is low, firms should be experiencing reduced excess capacity. As capacity is… Read More »