Research & News
Asset Allocation Weekly (March 10, 2017)
by Asset Allocation Committee As the FOMC prepares to raise interest rates, it’s a good time to update our views on long-term interest rates. The chart below shows our current estimate of fair value for the 10-year Treasury. The model uses fed funds, the 15-year moving average of CPI (an inflation expectations proxy), the yen/dollar exchange… Read More »
Daily Comment (March 10, 2017)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] Happy Jobs Day! The February jobs report was generally positive, with payroll easily beating estimates at 235k compared to the forecast of 200k. Wage growth was pretty strong, coming in line with expectations at 2.8%. Equities have responded positively to the data, whereas bonds… Read More »
Daily Comment (March 9, 2017)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] Equity markets remain relatively calm as the ECB decided to leave its monetary policy unchanged. During a press conference, Mario Draghi stated that even though risks have become less pronounced, global factors are still a threat to the overall stability of the Eurozone. We… Read More »
Daily Comment (March 8, 2017)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] Populist candidates in both France and the Netherlands are seeing their polling numbers deteriorate. In France, Marine Le Pen is holding at around 26% support, which is a statistical dead heat with Emmanuel Macron. She was leading by up to seven points last month. … Read More »
Daily Comment (March 7, 2017)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] In Washington, the wheels of policy continue to move forward. The GOP has offered its first swing at replacing the Affordable Care Act (ACA). It keeps many of the more popular measures, such as pre-existing condition coverage and child coverage up to age 26. … Read More »
Weekly Geopolitical Report – The Assassination of Kim Jong Nam (March 6, 2017)
by Bill O’Grady On February 13th, Kim Jong Nam, the older half-brother of Kim Jong Un, the leader of the Democratic People’s Republic of Korea (DPRK), was assassinated at an airport in Malaysia. This event offers insights into the “Hermit Kingdom” and shows the audacious nature of the regime. In this report, we begin with a… Read More »
Daily Comment (March 6, 2017)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] There were two news stories of note over the weekend. First, President Trump accused the previous administration of wiretapping his campaign. This is a very significant charge, akin to Nixon’s “plumbers” breaking into the Democratic National Headquarters. The FBI and the former Director of… Read More »
Asset Allocation Weekly (March 3, 2017)
by Asset Allocation Committee Since the election of President Trump, a number of sentiment indicators have risen strongly. There is concern that the improving sentiment isn’t warranted. In this week’s report, our research supports the conclusion that improving sentiment is better described as a reflection of the overall state of the economy. In other words, our… Read More »
Daily Comment (March 3, 2017)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] We are seeing a modest decline in U.S. equities and a softer dollar as traders square positions in front of two key speeches today, one from Vice Chair Fischer and the other from Chair Yellen. It is highly likely these leaders at the Fed… Read More »
Daily Comment (March 2, 2017)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] Yesterday’s equity market rally was quite impressive; President Trump’s speech was clearly well received and the ISM data also came in strong, raising hopes of a better economy. This chart shows the yearly change in the S&P 500 index along with the ISM manufacturing… Read More »