The Economic Insights Channel

Dan Fuss Warns of Geopolitical Risks and Higher Rates

Dan Fuss has established himself as one of the most respected bond investors in the industry over his 60-year tenure. In a talk last week, Fuss warned investors of geopolitical uncertainty and higher rates in credit markets.

The Metamorphosis of Emerging Markets

The relative performance of emerging markets has been unremarkable over the past decade, however meaningful changes have taken place in the fundamental and financial construct of the asset class that are relevant for asset allocators. Most notably, the composition of the index has seen dramatic shifts in sector, country, and stock constituents...

Conference Board Leading Economic Index: First Decline in Over a Year

The latest Conference Board Leading Economic Index (LEI) for September decreased to 128.6 from 128.8 in August and saw its first decline in over a year. The Coincident Economic Index (CEI) came in at 115.7, up fractionally from the previous month.

5 Things to Know About Emerging Markets

Emerging markets debt and equity have many overlapping traits, but also differ in their exposure to countries and risks. The MSCI Emerging Markets Index contains 27 countries, with the five largest accounting for 70% of market value. Three countries in Asia - China, South Korea and Taiwan - comprise more than 50% of the index.

Global Economic Perspective: October

Recent data have supported our view that the drivers of the US economy’s solid expansion remain in place, and should allow the US Federal Reserve (Fed) to move further toward its goal of normalizing interest rates. Some data releases have clearly been skewed by the recent major hurricanes, but we feel any negative impact on the economy is likely to be transient and outweighed by demand arising from reconstruction.

Quarterly Update: October 2017

The modest growth rate is contributing to the length of the current economic expansion, and American households are in the best financial shape in years. Our 3Q17 Quarterly Update report discusses the economic expansion and its impact on equities, fixed income, and more.

Philly Fed Manufacturing Index: Continued Growth in October

The latest Manufacturing Index came in at 27.9, up from last month's 23.8 and has been positive for fifteen consecutive months. The 3-month moving average came in at 23.5, up from 20.7 last month. Since this is a diffusion index, negative readings indicate contraction, positive ones indicate expansion. The Six-Month Outlook came in at 46.4, a decrease from the previous month's 55.2. Today's 27.9 headline number came in above the 22.0 forecast at Investing.com.

Weekly Unemployment Claims: Down 22K, Lowest Since 1973

Today's seasonally adjusted 222K new claims, down 22K from last week's revised 244K, was better than the Investing.com forecast of 240K. From the release: "Claims taking procedures continue to be severely disrupted in Puerto Rico and the Virgin Islands as a result of power
outages and infrastructure damage caused by Hurricanes Irma and Maria."

Five Decades of Middle-Class Wages: September 2017 Update

We've updated this series to include Friday's release of the Consumer Price Index as the deflator and the September monthly update. The latest hypothetical real (inflation-adjusted) annual earnings are at $37,346, down 12.9% from 44 years ago.

Through the Noise: More of the Same

Beyond all the twists, turns, and quirks in the economic data reports, the overall picture appears largely the same. Growth remains on a moderate track, somewhat beyond a long-term sustainable rate (as the job market continues to tighten).

Ten Investor Takeaways From the IMF/World Bank Meetings

Global central bankers, ministers of finance and representatives from the private sector and civic groups gathered in Washington, D.C., last week for the Annual Meetings of the IMF (International Monetary Fund) and the World Bank Group.

Will ECB Tapering Trigger Market Tantrum?

The European Central Bank is widely expected to announce a winding down of its quantitative easing program on October 26. Though investors are nervous, the ECB is doing a good job preparing markets for the change.

Putting Geopolitical Tensions into Perspective

When world leaders talk, markets react. And with social media becoming mainstream, politicians have a new way of getting their message to the masses.

Falling Correlations Put Stock-Specific Attributes in Driver’s Seat

Low market correlations make it easier for active portfolio managers to stand out—positively or negatively. But what matters most is how a portfolio of select stocks performs through market cycles, regardless of correlations.

Trump Packing Federal Courts With Conservative Judges

While the mainstream media remains obsessed with President Trump’s tweets and other controversial statements, the Commander-in-Chief is quietly packing the federal courts with conservative, originalist judges who are not only very smart but also relatively young.