How Much Will Inflation Pick Up We’ve discussed inflation in previous articles. I think it will increase because the M2 money velocity is up, the NY Fed underlying inflation index is up, and the ISM manufacturing index is up. There has also been a further decline in the unemployment rate which shoul
Most Assets See Low Volatility The stock market had a slightly negative day as the S P 500 was down 0.02%. The Russell 2000 - RUT was a big laggard as it was down 1.26%. Ever since I warned about it being overextended, it has fallen. The VIX actually had a big up day which was
More Fed Changes Over The Weekend Over the weekend Bill Dudley announced his resignation increasing the turnover at the Fed which was already about to be large with all the empty positions from previous resignations. The Fed officials recognize that President Trump is cleaning house which appears to
Earnings Season Forever Changed By Regulation FD Earnings season is mostly done, so it’s fair to say this was a great reporting period. Usually I only have the stats on the percentage of firms beating estimates in the past 4 years. The chart below gives us more data to look at to further contextuali
As I expected, the labor report showed 261,000 jobs created. It was far below the 310,000 expected as the hurricane effect didn’t turn out to move as many jobs from September to October as economists thought. The jobs report is always tricky to project. Adding the weather into the mix only made it m
Productivity Growth Returns The biggest economic change in 2017, in my opinion, is the improvement in productivity. Growth in productivity is the key to economic expansion. Without productivity growth, we just have nominal growth driven by inflation. Productivity grew 3% on an annualized rate in Q3
Apple - AAPL Reaches A $900 Billion Market Cap Arguably the most important company in the stock market, AAPL, reported earnings a day before the iPhone X goes on sale. The company beat estimates for $1.87 per share by reporting $2.07 in EPS. Revenues of $52.6 billion beat estimates for $50.7 billion
Facebook’s 2018 Spending Growth Disappoints Facebook - FB reported earnings on Wednesday; it’s the second to last major tech firm to do so. Apple will be the last one on Thursday. Tech is about 24% of the S P 500 and it’s about 24% of total earnings. Facebook reported a great result, but was hindere
The Banks Have Had A Great Run Globally The chart below shows an interesting global trend which has been occurring in the past few quarters. As you can see, bank stocks’ 12 month forward multiples are rising in Japan, America, the U.K., and Europe. American net interest margins are improving as the
Housing Prices Headed Up? Let’s look at the housing market. It’s important for housing prices to increase in a steady manner to help people’s net worth improve. As we’ve discussed, savings rates are down and real earnings growth has been stagnant for non-supervisors. The wealth effect might just be
