The Commodities Channel

Household Debt Hits New Record High, Stocks Stumble

The Federal Reserve Bank of New York reported last week that US household debt reached a new all-time high in the 1Q of this year. The new report also included some troubling internal metrics, not only on the overall household debt levels but also with regard to the level of delinquencies.

Here’s Why I Think Renewable Energy Is Finally Living up to Hype

Global markets have steadily been adding renewables such as wind and solar to their energy mix for several years now, but according to a handful of new reports, 2016 might have been the tipping point.

The Forecast for Interest Rates is Changing

Is it time to add convertible bonds?

Finding Value Globally Across Asset Classes

Jae S. Yoon is the chief investment officer and a portfolio manager at New York Life Investment Management, where he oversees approximately $293 billion in assets. In this interview, he discusses valuations across global asset classes and where he sees the greatest opportunities.

Jack Bogle on the Limits of the Fiduciary Rule and the Future of the Advisory Industry

Speaking two weeks after his 88th birthday, Jack Bogle called the fiduciary rule “silly” and said that financial advisors’ fees are heading lower. Indeed, he said, advisors are destined to charge hourly or retainer fees, like lawyers and accountants.

Yawn…

Expectations for U.S. growth continue to slow as distractions in Washington D.C. take away from the aggressive legislative agenda.

Jeremy Siegel versus Robert Shiller on Equity Valuations

Should you reduce allocations to U.S. equities given the conventional wisdom that prices are “rich” and “due for a correction”? Jeremy Siegel says no; investors should expect 5% real returns from stocks over the long term. But Robert Shiller thinks that number should be much lower.

Weekly Gasoline Price Update: Regular Up 3 Cents, Premium 2 Cents

It's time again for our weekly gasoline update based on data from the Energy Information Administration (EIA). The price of Regular is up three cents and Premium two cents from last week. According to GasBuddy.com, California has the highest average price for Regular at $3.07 and San Francisco, CA is the most expensive city, averaging $3.25. South Carolina has the cheapest at $2.04. The WTIC end of day spot price closed at 48.85, a 4.7% increase from this time last week.

On My Radar: Near Term Looks Good, Long Term Looks Scary

This is one of the more important pieces I’m sharing with you. It’s a candid look at where we are in the economic cycle and what that likely means for the global markets.

Chicago Fed: Increased Economic Growth in April

"Index Points to Increased Economic Growth in April." This is the headline for today's release of the Chicago Fed's National Activity Index, and here is the opening paragraph from the report: "Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) rose to +0.49 in April from +0.07 in March...."

The Best Fund Managers – As Voted by their Peers

Today’s indexing mania is driving the marketing people at the best active fund complexes completely crazy, but the top portfolio managers – that is, the people who really, truly enjoy investing – are seeing a lot of new opportunities.

S&P 500 Snapshot: Down 0.38% From Last Week

The S&P opened Friday below Thursday's close and rose until about midday when it leveled off. It closed with a 0.68% daily gain and a 0.38% weekly loss after Wednesday's largest daily loss since September.

Will the Fed Change Course?

The Fed story may well command attention. I classify it as an important story, but not an urgent one. I have some strongly-held viewpoints:

  1. The exact timing of rate hikes is not important for long-term investors. The Fed has been following a policy of rate increases in line with economic data. While many do not believe this, the data are supportive. Tim Duy on recent strength.
  2. That said, the rate increases have second- and third-order effects. The perception of the pace of hikes impacts exchange rates. The weaker dollar affects major corporate earnings – in both directions. This makes the Fed news worth watching.
  3. Current data are stronger than widely thought, but much depends upon how one views the Q1 softness—meaningful or aberrant. Recent Fed speeches suggest a moderation in the rate-hike path.
  4. Rates will be increased more slowly, but the balance sheet will be reduced.

Hedge Fund Managers Pour SALT on U.S. Stocks, Look to Europe

Europe is back on the map. That was one of the main takeaways this week from the SkyBridge Alternatives (SALT) hedge fund conference in Las Vegas, where $3 trillion in assets was represented. Speaker after speaker touted European equities for their attractive valuations and as a means to diversify away from the volatile American market in light of rising U.S. geopolitical risk. France’s election of centrist Emmanuel Macron over far-right nationalist Marine Le Pen this month has especially eased investors’ fears that antiestablishment forces would challenge the integrity of the European Union (EU).

China's Trilemma

On the surface, China continues to outperform expectations. It has sustained a high rate of economic growth for longer than most other developing countries.