Research & News
Daily Comment (July 21, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] The JPY rose strongly overnight after media reports quoted BOJ Governor Kuroda as saying that helicopter money was not being considered and would never be implemented. This comment came as a surprise as the financial markets have been steadily discounting some sort of action from the… Read More »
Keller Quarterly (July 2016)
Letter to Investors In my travels around the country this year, meeting with clients and advisors, I’ve been struck by the high level of political passion (both optimistic and pessimistic), similar to what we see both in the political arena and in the media. Inevitably, I’m asked what I think about it all. “Who do… Read More »
Daily Comment (July 20, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] Market commentary is starting to suggest that the FOMC may be heading toward a rate hike later this year. Since the Brexit event is now behind us and the U.S. economy has stabilized, if the Fed wants to return to a tightening mode, it could. However,… Read More »
Daily Comment (July 19, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] Financial and commodity markets are very quiet this morning as the summer doldrums are starting to become evident. However, three news items did catch our attention and are worthy of comment: GOP Platform calls for a return to Glass-Steagall: The Glass-Steagall Act separated commercial from investment… Read More »
Asset Allocation Quarterly (Third Quarter 2016)
The U.S. economy is likely to remain in its low-growth trend and we don’t foresee a recession, given that the Fed has become less inclined to raise rates. Brexit should be largely transitory for Britain, but may reveal a variety of weaknesses within the European Union. The U.S. presidential elections reveal a myriad of changing… Read More »
Weekly Geopolitical Report – Meet Theresa May (July 18, 2016)
by Bill O’Grady On Monday, July 11, U.K. Energy Minister Andrea Leadsom withdrew from the race for prime minister. The Tories decided to end the leadership contest with Leadsom’s exit, giving the PM job to Theresa May. She officially took over the role on Wednesday, July 13. In this report, we will begin with a discussion… Read More »
Daily Comment (July 18, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] The big weekend news was the failed coup in Turkey. Late Friday, news began to emerge of unusual troop movements within the country. By evening, it was clear that a full-blown coup attempt was underway. President Erdogan issued a statement to his followers via FaceTime to… Read More »
Daily Comment (July 15, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] There were two major news items overnight, the Nice terrorist attack and China’s GDP. News reports indicate that there were 84 deaths from a terrorist attack in Nice, France. The attacker, identified as Mohamed Lahouaiej Bouhlel, a French passport holder of Tunisian descent, used a 19… Read More »
Asset Allocation Weekly (July 15, 2016)
by Asset Allocation Committee Since the recovery began, we have consistently favored duration in fixed income. Our position has been that growth would remain sluggish in the developed world and global overcapacity would keep inflation contained. The consensus of strategists and economists didn’t support our position. This chart shows the path of the 10-year T-note yield… Read More »
Daily Comment (July 14, 2016)
by Bill O’Grady and Kaisa Stucke [Posted: 9:30 AM EDT] Equities are higher this morning on expectations of continued support from policy stimulus. Although the BOE disappointed (see below), the BOJ looks like it is moving steadily toward direct BOJ financing of fiscal spending, otherwise known as helicopter money. Japan remains mired in near-deflationary conditions and… Read More »