Research & News
Daily Comment (September 12, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Yesterday’s market action was consistent with a sharp reversal in the recent risk trade. Amidst concerns about North Korea, the debt ceiling, trends in Washington, hurricane problems, etc., we saw Treasuries and gold rally, the dollar stumble and equities tread water. Those positions reversed yesterday with… Read More »
Weekly Geopolitical Report – Reflections on Nationalism: Part III (September 11, 2017)
by Bill O’Grady Three weeks ago, we began our series on nationalism. In Part I, we discussed social contract theory before and after the Enlightenment. We examined three social contract theorists, Thomas Hobbes, John Locke and Jean-Jacques Rousseau. In Part II, we recounted Western history from the American and French Revolutions into WWII. From there, we… Read More »
Daily Comment (September 11, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Sixteen years ago, the U.S. suffered its worst terrorist attack in its history. The nation was changed in numerous ways, both large and small. Every time we fly commercial we are reminded that our safety was compromised. The country is still trying to unwind two wars… Read More »
Asset Allocation Weekly (September 8, 2017)
by Asset Allocation Committee As the FOMC prepares to reduce its balance sheet, it’s a good time to update our views on long-term interest rates. The chart below shows our current estimate of fair value for the 10-year Treasury. The model uses fed funds, the 15-year moving average of CPI (an inflation expectations proxy), the yen/dollar… Read More »
Daily Comment (September 8, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Market action is sluggish this morning; the big story is the continued weakness in the dollar. Here is what we are watching today: The dollar in perspective: The EUR is threatening $1.210 and the greenback continues to slide despite dovish comments from ECB President Draghi yesterday. … Read More »
Daily Comment (September 7, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Happy productivity day! Lots of news this morning; here is what we are watching: The ECB: The ECB’s statement was a repeat of the one from a few weeks ago. In the press conference, the reporters focused most of their questions on the exchange rate. President… Read More »
Daily Comment (September 6, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Financial markets are easing off the flight from risk exhibited yesterday. There wasn’t a lot of breaking news overnight, but there are currently several significant news items. Here’s a recap: Hurricane Irma: There are three tropical events in the Atlantic but Irma is the current focus… Read More »
Daily Comment (September 5, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Goodbye summer! We are now moving into autumn. Here is what we are watching today: North Korea: The Hermit Kingdom was active over the holiday weekend. It detonated another nuclear device, claims to have miniaturized it for a warhead and is reportedly preparing for another missile… Read More »
Asset Allocation Weekly (September 1, 2017)
by Asset Allocation Committee We have previously documented the difference between S&P 500 operating earnings reported by Thomson/Reuters and Standard and Poor’s. Although both series purport to measure the same thing, there can be rather wide divergences. These exist due to differences in how unusual events are accounted for; we do often see long periods where… Read More »
Daily Comment (September 1, 2017)
by Bill O’Grady and Thomas Wash [Posted: 9:30 AM EDT] Happy Employment Day! We recap the numbers below. Here is what we are watching today: Q3 GDP looking strong: Q2 GDP was revised to 3.0%, and the Atlanta FRB is projecting a 3.3% growth rate for Q3. We present the relevant charts below. The estimated growth… Read More »