Research & News
Asset Allocation Weekly (October 20, 2017)
by Asset Allocation Committee The Financial Accounts of the United States (formerly known as the Flow of Funds Report) is published by the Federal Reserve and provides data on the level of financial assets and liabilities by sector. Using this data, we can approximate the average asset allocation of American households over different periods. This accounting… Read More »
Daily Comment (October 20, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Risk-on returned to the financial markets this morning, with the dollar and equities higher and Treasuries and gold lower. The possibility that John Taylor could be the next Fed chair along with hopes of tax reform are boosting risk assets this morning. Chair talk: There are… Read More »
Daily Comment (October 19, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Something unusual is happening this morning…equity futures are pointing to a lower opening. At the time of this writing, S&P futures are indicating about a 0.5% decline. In the sea of calm we have been operating in, such a modest decline does look rather different. We… Read More »
Daily Comment (October 18, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Tax reform: Senate Republicans are moving closer to tax reform as 50 senators have agreed to begin debate on a budget resolution. In order for tax reform to happen, the Senate must first pass a budget appropriations bill. Currently, there appear to be a few… Read More »
Daily Comment (October 17, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] U.S. financial markets are quiet, but there is a lot going on again today. Here’s what we are watching this morning: Taylor to the Chair? John Taylor, the creator of the “Taylor Rule,” visited President Trump yesterday and, according to news reports, the president was very… Read More »
Weekly Geopolitical Report – North Korea and China: A Difficult History, Part I (October 16, 2017)
by Bill O’Grady The U.S. and North Korea have had a difficult history. The two countries were the primary combatants during the Korean War and still have not established a peace treaty. However, in the late 1970s, the Kim regime and the Carter administration considered normalizing relations. Carter’s national security team concluded there was little value… Read More »
Daily Comment (October 16, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Although U.S. financial markets are quiet, there is a lot going on. Here’s what we are watching this morning: War in Iraq? Iraqi troops have taken a refinery and captured oil fields surrounding the city of Kirkuk. So far, only Iraqi regular army troops have been… Read More »
Asset Allocation Weekly (October 13, 2017)
by Asset Allocation Committee With the S&P making new highs almost daily, it is probably a good time to look at long-term trends to build some parameters. This is a simple trend chart of the S&P 500 Index. We have log-transformed the weekly Friday closes of the index data and regressed it against a time trend. … Read More »
Daily Comment (October 13, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Markets are quiet again this morning; we are seeing the dollar weaken a bit and bonds rally on the weaker than forecast CPI data. On the other hand, retail sales were strong, although some of that is coming from hurricane distortion. Here is what we are… Read More »
Daily Comment (October 12, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Fed minutes: The Fed minutes didn’t have a lot of surprises; we would characterize them as modestly dovish. Going off the terms used, “several” members were uncertain about inflation and wanted more data to improve their confidence, while “a few” believed that additional increases should… Read More »