Research & News
Daily Comment (December 12, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] The two major news items this morning are OPEC and China. First, OPEC managed to procure pledged cuts of 558 kbpd from non-OPEC producers. This is the first time since 2001 that the cartel has managed to get production cut pledges from producers outside… 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 »
Daily Comment (December 9, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] BREAKING NEWS: The ECB has rejected a request by the troubled Italian bank Monte dei Paschi (BMDPY, $0.18) for an extension of the deadline for the bank to raise more capital. Italian banking authorities had requested more time to complete a €5 bn rescue… Read More »
Daily Comment (December 8, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] The ECB gave us a modest surprise this morning by announcing a tapering of QE. Expectations called for an extension of the current program through September. Now, through March 2017, the bank will purchase €80 bn of bonds; from April to December, the bank… Read More »
Daily Comment (December 7, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] Today is the 75th anniversary of the bombing of Pearl Harbor, a monumental event that led to U.S. involvement in WWII and eventually acceptance of the superpower role at Bretton Woods in 1945. It was another quiet market overnight. Perhaps the most important overnight… Read More »
Daily Comment (December 6, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] It was mostly quiet overnight with the market’s focus on the aftermath of the Italian referendum. The most relevant concern is the Italian banking system. The lead headline in today’s FT is “Monte dei Paschi Warned to Brace for State Bailout after Renzi Defeat.” … 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 »
Daily Comment (December 5, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] Italians rejected former PM Renzi’s plans for government restructuring. This outcome was actually expected by pollsters, although the level of the rejection, at 60%, was at the highest end of expectations. As he promised, Renzi resigned. The president of Italy will now give time… 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 »
Daily Comment (December 2, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EST] Happy employment data day! We cover the report in more detail below but, in a nutshell, the big surprise was a drop in the unemployment rate to 4.6%, the lowest since August 2007. The unemployment rate fell due to a 266k drop in the… Read More »