Weekly Commentary

It’s hard to imagine why Americans seem so miserable – record real wage growth, all-time highs in the stock market, home price appreciation, record low unemployment, and moderating inflation. Why President Biden and the current political class are in any trouble at all is a head-scratcher. A recent survey by Goldman Sachs suggests that inflation […]

While the ebbs and flows of the news cycle might have investors on edge for an impending crash, those watching corporate earnings might have a different view. Corporate earnings results for the final quarter of 2023 signaled continued corporate strength. Earnings growth was over 4%, compared with expectations for a 1.5% rise on December 31st. […]

With the S&P 500 up 43.61% off the low set in 2022 and trading at all-time highs, the question I get asked the most is are we in a bubble? 1 The straight answer is I don’t know, and no one else does either. Sure, there will be a pundit who jumps on TV and […]

2024 was always going to be the year of the interest rate. Coming into the year we knew of the large discrepancy between what the Fed was forecasting for rate cuts and what Wall Street believed was the making of market risk. 1 The discrepancy is in the shaded area. Today that picture looks entirely […]

Last week’s economic data threw a splash of cold water on the U.S. inflation debate and interest rate picture. Both headline Producer Prices (PPI) and Consumer Prices (CPI) rose more than expected. On the producer side, both food and energy prices are actually dropping, with services inflation driving most of the re-inflation. 1 On the consumer […]

The S&P 500 hit a historic high, crossing over the 5,000 level, last week. It begs the question; are valuations overextended in U.S. Large Cap equities? By most measures, the answer is a resounding yes. It’s an answer most in asset management dread as it requires some tough decision-making. 1 Do you try and time […]

The January Jobs Report was released on Friday and the headline number put an end to the March Fed interest rate cut, as the U.S. economy added 355k jobs – much stronger than expectations. 1 Oddly enough, we had the same type of jobs surprise in January of 2023. There is certainly something lurking under […]

In the last quarter of 2023, the US economy had the perfect landing as the overall economy grew at a 3.3% rate with hardly a blemish. The consumer continues to drive our prosperity, ultimately dictating corporate earnings growth. 1 Simultaneously, the Fed’s preferred measure of inflation, Personal Consumption Expenditure (PCE), continued to moderate. It’s now […]

This Friday we will get another report on U.S. Personal Income, and I suspect it will continue to show real wage growth – that’s wages growing at a faster pace than inflation. This has been a trend for almost a year. 1 This one data point is really the key driver to ongoing consumption and […]

We continue to focus on inflation as a primary driver for macro allocation. Inflation is going to determine interest rates and interest rates almost always impact the future value of investments like stocks, bonds, and real estate. Recent consumer price data continues to point to lower inflation, albeit with a few bumps along the way. […]