Research & News
Daily Comment (October 27, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EDT] Belgian political leaders were able to overcome Walloon’s opposition to the free trade deal with Canada and so, at the deadline, it looks like the agreement will be approved, assuming none of the other 27 nations decide to oppose the deal, too. Most of… Read More »
Daily Comment (October 26, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EDT] Global equity markets are weaker this morning off some disappointing earnings reports. This shift in sentiment is routine during earnings season. It does appear that the EU-Canadian free trade deal may be back on track as the Walloons are reportedly moderating their opposition.[1] Still,… Read More »
Keller Quarterly (October 2016)
Letter to Investors In our July letter we wrote about the “is-ought problem,” the tendency to confuse the world we have with the world we wish we had. As we noted then, this problem represents a major danger around election time for investors (and others). The danger is that investors may be so consumed with… Read More »
Daily Comment (October 25, 2016)
by Bill O’Grady, Kaisa Stucke, and Thomas Wash [Posted: 9:30 AM EDT] Overnight news flow was unusually low. Earnings are generally coming in favorably as energy companies recover. Equity markets remain relatively firm. The new money market rules officially went into effect on Oct. 14th and, now that they are in place, the short-term money markets… Read More »
Weekly Geopolitical Report – The Geopolitics of the Reserve Currency: Part 1 (October 24, 2016)
by Bill O’Grady One of the more interesting developments in this presidential political cycle has been the near total abandonment of free trade. Neither presidential candidate supports the Trans-Pacific Partnership (TTP) or the Transatlantic Trade and Investment Partnership (TTIP), the topic of last week’s report. The primary reason for this backlash against free trade is the… Read More »
Daily Comment (October 24, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] Good ISM data from Europe (see below) lifted global equity markets. Mergers are another factor affecting financial markets, with the biggest being Time Warner (89.48, +6.84) and ATT (37.49, -1.15). This one is getting lots of political attention. Donald Trump has already indicated that his administration… Read More »
Asset Allocation Weekly (October 21, 2016)
by Asset Allocation Committee The dollar has been strengthening over the past few weeks; we believe much of this appreciation is due to expectations of tighter monetary policy. Fed funds futures suggest that there is a 60+% chance of a rate hike at the December FOMC meeting. Although the FOMC is divided and there are prominent… Read More »
Daily Comment (October 21, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] The dollar is higher this morning on speculation that the Fed interest rate policy will diverge from the easy monetary policies implemented in Europe and Asia. The dollar rose yesterday and the euro fell as investors interpreted ECB President Draghi’s comments as an indication that stimulus… Read More »
Daily Comment (October 20, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] ECB President Mario Draghi is giving his press conference as we write this. The ECB maintained its benchmark lending rate at zero, the deposit rate at -0.4% and the asset purchases at €80 bn a month. Draghi said that the central bank expects interest rates to… Read More »
Daily Comment (October 19, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] It’s a relatively quiet morning on the macro front. Chinese data came in on forecast to slightly weaker than expected. While GDP rose 6.7% annually, as expected, industrial production rose 6.1% annually, weaker than expected. Yesterday afternoon, the Treasury International Capital (TIC) net monthly flows report… Read More »