January U.S. CPI: A Small Setback for the Immaculate Disinflation
The consumer price index (CPI) for January showed that core inflation held steady at a rate of 3.9% last month, a small setback in a trend of moderating inflation in the U.S. Healing in global supply chains and a rebalancing of the U.S. labor market have helped to dramatically tame inflation over the past year.
A U.S. Recession Looks Less Likely This Year. But We Believe the Risks Are Still Elevated.
There will be a lot of firsts for the economic history books if this business cycle can survive a labor market slowdown, 525 basis points (bps) of rate hikes and an extremely inverted U.S. Treasury yield curve.
The Energy Transition, Part 2: The Transition Challenge
Fossil fuels, particularly oil, are difficult to replace due to their availability, affordability and energy density. Low-carbon alternatives, like solar energy, need large amounts of space to produce comparable amounts of energy to oil.
The Energy Transition, Part 1: A Primer on the Clean Energy Transition
A transition away from fossil fuels is likely required to avert a significant warming of the planet. Rising temperatures could lead to crop failures, storm intensification, ocean acidification and deoxygenation, and infrastructure damage, among several other risks.
How Could an Energy Transition Impact Global Markets and Economies?
A transition away from fossil fuels is likely required to avert a significant warming of the planet. The primary risk to markets is the energy transition itself, which would require substantial capital expenditures.
What Steps Should DB Plan Sponsors Consider Taking Ahead of a Potential Recession?
Is a recession lurking around the corner in 2023? If so, how might it impact defined benefit (DB) plan sponsors—and what steps, if any, should they consider taking?
Still Transitory: U.S. Fed Maintains Stance on Inflation, Announces Start of Tapering
Chair Jerome Powell and the Fed had been holding the market’s hand in the lead-up to the tapering decision, making it abundantly clear that a decision was imminent at today’s meeting and effectively pre-announcing all of the relevant details of the decision...
Why U.S. Rates Are Only Likely To Rise Modestly In 2021
Effective vaccines, historic fiscal stimulus, Democratic Party control of the legislature, even more stimulus, reopening economies, 6% U.S. real GDP (gross domestic product) growth, 25% U.S. EPS (earnings per share) growth, and maybe even an infrastructure plan sprinkled on top.
The Perils of Passive Investing Amid a Highly Concentrated S&P 500
Five companies now comprise 26% of the market capitalization of the S&P 500® Index, making for the most concentrated U.S. equity market in the last 40 years. What are the potential dangers of this for investors?
The Full Extent of Income Support for Impacted U.S. Households Is Impressive
Global equity index futures are trading up about 4% this morning. The coronavirus data over the weekend was less bad. The growth rate in new confirmed cases over the last 24 hours globally was the lowest since March 17—a welcome sign that containment measures are gaining some traction in slowing the spread of the disease.
Coronavirus Update: As Market Volatility Continues, Fiscal Response Looms Large
One of the keys to the outlook here is the ability of businesses to get to the other side of potentially acute short-term cash flow problems. Fiscal policy holds the necessary antidotes in its ability to provide targeted, material support to impacted sectors.
How Low Can You Go: Monetary Policy Constraints and Options for the Next Recession
This is the longest U.S. economic expansion ever. And while expansions don’t die of old age, it’s prudent for investors and central bankers to think now about the potential consequences of the next global recession.
China Beats Expectations and Brexit Avoids the Cliff Edge. What Does It Mean for Markets?
On the latest edition of Market Week in Review, U.S. Institutional Senior Director Rob Cittadini and Senior Investment Strategist Paul Eitelman discuss recent economic data from China, the Brexit deadline extension, and the contrasting impact on global equity and fixed-income markets.
The Fed Could Still Hike Rates Again This Year. Here's Why.
As expected, the U.S. Federal Reserve (the Fed) left interest rates unchanged at the conclusion of today’s policy meeting, once again emphasizing a patient approach to monetary policy in the months ahead.
January FOMC Meeting: A Pause, but (Probably) Not the End of the Tightening Cycle
Leading into today's Federal Open Market Committee (FOMC) decision, Chair Jerome Powell and a host of regional Federal Reserve (the Fed) bank presidents had unanimously expressed support for a pause in the Fed's tightening cycle. Even perma-hawk Esther George, from the Federal Reserve Bank of Kansas City, advocated for a cautious and patient approach to monetary policy in her speech a few weeks ago.
Fed Hikes Rates Again in Slam-Dunk Decision. Could a Trade War Derail Future Raises?
As expected, the Fed raised interest rates today following its September policy meeting. Could the escalating trade war between the U.S. and China impact plans for future increases?
Hawks, Doves and Jays: Takeaways From First Fed Rate Hike Under Jerome "Jay" Powell
With new chair Jerome Powell at the helm, the Fed increased borrowing costs today for the sixth time since the U.S. economic expansion began. Can markets expect continued rate hikes under Powell's watch?
Taxes, Taxes, Taxes: Economic and Market Implications of the New U.S. Tax Bill
The U.S. Congress passed a significant bill today that makes sweeping changes to the country’s tax code. How much of a boost could the new law provide to financial markets and the nation’s economy?
Happy Holidays: Fed Wraps up 2017 with Another Rate Hike
The U.S. Federal Reserve (the Fed) delivered another rate hike today, raising its target policy rate by 25 basis points to a new range of 1.25-1.50%. The decision was widely anticipated by economists and fixed income investors.