The majority of U.S. economic data are based on statistical samples and the various figures are typically adjusted for seasonal variation. That means that the numbers are subject to some level of uncertainty.
Around the turn of the century a bandit rode in from Mexico, robbed a small Texas bank, and fled back across the border. A Texas Ranger picked up his trail and nabbed him in a Mexican village. The bandit spoke no English and the ranger no Spanish, so another villager was asked to interpret.
Jesse Livermore was one of the legendary icons of Wall Street speculation. Known as the “boy plunger,” because he began trading at the tender age of 14, he was subsequently banned from many “bucket shops” for winning too often. Therefore, he moved to New York City to swing in the big leagues.
President Trump is expected to announce a revised tax cut plan soon. In the meantime, it’s worth revisiting how the sausage gets made in Washington. By law, tax code changes must originate in the House of Representatives, and the Senate will have its say.
Something similar to this “new queen bee” story is happening now. The “old queen” has been the Federal Reserve and monetary policy. The “new queen” appears to be the White House and fiscal policy.
Fed Chair Janet Yellen will present her monetary policy testimony to Congress on Tuesday and Wednesday. We may not learn much new regarding the pace of future rate increases (which will remain data-dependent) and she’s certain to avoid getting into any discussion of fiscal policy.
“Unseasonably mild and clearing,” was the weather forecast going into the Ides of March back in the year of 1888. And it was true, as temperatures hovered in the 40s and 50s along the East Coast. However, torrential rains began falling...
“You have enemies? Good. That means you've stood up for something, sometime in your life.” . . . Winston Churchill
January economic data are relatively unreliable, but recent figures paint a fairly consistent picture of where we are headed in the near term. While there is reason to be optimistic, it’s still a mixed bag, with some concerns about what we’ll see coming out of Washington over the next several months.
Real GDP rose at a 1.9% annual rate in the initial estimate for 4Q16, with the headline growth figure held down by a wider trade deficit. That does not mean that foreign trade is a drag on the U.S. economy.
As most of you know, I was in Europe for 19 days seeing institutional accounts and speaking at conferences. However, the last few days of the trip were spent with our new institutional affiliate Oscar Gruss & Son in Israel, where Avi Avital and Ronen Cohen met me at Ben Gurion Airport along with Bena Mantel.
It goes without saying that there is a sharp contrast between the economic views of the incoming administration and those of the Federal Reserve. President Trump, and most of the individuals who voted for him, sees a weak economy, devastated by job losses in manufacturing. The Federal Reserve sees an economy nearing full employment. So who’s correct?
We have often written that when everyone is asking the same question, it is usually the wrong question. However, I have also found the converse to be quite true – if no one is asking a question, it is probably one that you want to at least ask yourself just in case.
Since the November election, the financial markets have priced in a more friendly business environment, with growth boosted by expansionary fiscal policy. However, the White House does not have absolute power.
By now, you have likely heard something, either directly or indirectly, about “The Great Rotation” from bonds into stocks.
The December Employment Report showed the job market to be in good shape. The pace of job growth slowed in 2016, partly reflecting tighter labor market conditions.
We live in a modern world of acronyms and buzzwords, and the financial industry is certainly no exception. In fact, it may be one of the worst culprits, what with FANG, ZIRP, TINA, BREXIT, QUITALY, BRIC, etc. all entering the lexicon over the last few years.
“It’s what you learn after you know it all that counts.” - Earl Weaver
As we enter 2017, we expect the current economic rebound to continue suggesting GDP growth will likely move toward the 3% level by the end of the year based on less monetary stimulus, more fiscal stimulus, a reduction in the corporate tax rate, and deregulation.
“Miracle on 34th Street” is a 1947 movie whose plot takes place between Thanksgiving Day and Christmas in New York City. It focuses on a department store Santa Claus who claims to be the real Santa.
The outlook for 2017 is now shaping up as a battle of ideas, though few seem to be realizing it yet. The stock market has risen since the election.
The absolute price of a stock is unimportant. It is the direction of price movement which counts.
Federal Reserve policymakers are widely expected to raise short-term interest rates this week. The policy statement should continue to suggest that, while the pace of tightening is expected to be gradual, action will remain data-dependent.
The November job market report was a mixed bag. Nonfarm payrolls were in line with expectations, continuing to reflect a more moderate pace of job growth in 2016 (although still relatively strong).
One of the funnier shows in the Seinfeld comedy series was “Serenity Now.” The show centered on that phrase (serenity now) as George’s father, Frank Costanza, repeats the phase numerous times every time he gets upset.
In honor of the Thanksgiving holiday this week, I thought I’d reshare the fabled Wall Street tale about a character named “old Turkey” from the 1923 classic Reminiscences of a Stock Operator.
Following the surprising election of Donald Trump and the news that Republicans had held on to the House and Senate, the stock market rallied.
So, last week was interesting, huh? If nothing else, it was definitely a far cry from two or three months ago when investors could check in on the markets only every few days and not really miss much of anything.
The ultimate dream of market mavens is discovering a method that predicts the price movement of the major common stocks such as the 30 Dow Jones Industrials.
The October job market data were not far from expectations, consistent with a further tightening in labor market conditions.
Many shrewd investors who were nervous about overvalued shares had lost out before by selling too early and were coming back into the market.
The U.S. economy is complex. Most people want to sum it up in one simple number: real GDP growth.
Recent data reports have added little color to the economic outlook, but that may change soon enough. The advance GDP report should show the economy advancing at a moderate pace, but results are likely to remain mixed across sectors.
There was the king who held a chess tournament among the peasants and asked the winner what he wanted as his prize.
The analogy between the stock market and poker has always been irresistible. Interestingly, the stock market increasingly resembles a low-stakes recreational game among friends and less the sort of ‘there goes the ranch’ game favored by cutthroat professionals.
Nonfarm payrolls rose at a moderately strong pace in the initial estimate for September, a bit less than expected, but well within the usual range of uncertainty.
I knew that I had to adopt a cold, unemotional attitude towards stocks; that I must not fall in love with them when they rose and I must not get angry when they fell; that there are no such animals as good or bad stocks.
One of the rarest traits on Wall Street is patience, yet patience is one of the biggest secrets of successful investing.
Investors place far too much emphasis on the GDP figures. However, digging into the components suggests a less optimistic (not pessimistic) outlook for growth in the near term.
