Research & News
Quarterly Energy Comment (December 15, 2017)
by Bill O’Grady The Market Oil prices have recovered strongly from the mid-summer lows. It appears we are establishing a new trading range between $55 and $60 per barrel. This recovery was mostly caused by a steady decline in U.S. domestic crude oil inventories, a weak dollar and OPEC output discipline. We expect OPEC to… Read More »
Asset Allocation Weekly (December 15, 2017)
by Asset Allocation Committee Last week, the Federal Reserve released its Financial Accounts of the United States, formerly called the Flow of Funds report. It is a broad set of data that covers many aspects of the economy. Here we present some key charts from the report. This chart shows key private sector debt as a… Read More »
Daily Comment (December 15, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EST] Tax bill update: Although the conference committee has finished its work, it’s going to be something of a nail-biter to passage. Sen. Rubio (R-FL) has indicated he will vote against the current version unless the child tax credit is increased. It is unclear if Sen.… Read More »
Daily Comment (December 14, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EST] Markets are mostly quiet this morning, although there has been a lot of news over the past 24 hours. Here is what we are watching: Central banks: The Fed began the discussion (which we discuss at length below) but the BOE, ECB, PBOC and SNB were… Read More »
Daily Comment (December 13, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EST] It’s Fed Day! Here is what we are watching this morning: FOMC today: At 2:00, we will get a decision with certainty regarding a 25 bps rate hike. We will also get new dots and forecasts, along with Chair Yellen’s last press conference at 2:30. Usually,… Read More »
Daily Comment (December 12, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EST] Market activity is quiet this morning, but we are monitoring a number of interesting news themes. The Alabama Special: Special elections are being held in Alabama today to replace Jeff Sessions, who left the seat to become Attorney General. Polling has been wildly divergent but the… Read More »
Weekly Geopolitical Report – Moving Fast and Breaking Things: Mohammad bin Salman, Part III (December 11, 2017)
by Bill O’Grady In Part I of this report, we began with a brief background of Mohammad bin Salman (MbS) and discussed the surprise arrests of many leading figures in Saudi society, including several members of the royal family, that occurred the weekend of November 4. In Part II, we examined the forced resignation of Saad… Read More »
Daily Comment (December 11, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EST] It was a quiet weekend in front of an active week. Here is what we are watching this morning: NYC bombing: This is a developing incident but early reports suggest a pipe bomb or similar device was detonated near Times Square. According to early reports, there… Read More »
Asset Allocation Weekly (December 8, 2017)
by Asset Allocation Committee We have received a number of requests to update our S&P 500/Fed balance sheet model. This chart shows the results from our S&P 500/Fed balance sheet model. We have projected the model’s forecast using the expected path of balance sheet reduction. It shows that the equity index tended to follow monetary policy… Read More »
Daily Comment (December 8, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EST] It’s employment data day! We detail the data below but the short answer is that the numbers are good for capital—employment rose faster than forecast while wage growth came in weaker than expected. The lack of wage growth should bring some degree of pause on the… Read More »