Weekly Commentary

In a recent post, Are We Lost, I explored the headwinds that might impact economic growth in the coming quarter; auto workers strike, government shutdown and student loan payments recommencing. We’ve had the first hit, with the latest labor strike by the United Auto Workers. It might feel like we are coming apart at the […]

Phillips & Company has the privilege of advising thousands of clients from all walks of life and economic backgrounds with varying goals and objectives. All are impacted by rising interest rates, even those that have low to no debt. That’s why we field the same question frequently: “When will we have rate cuts?” I would […]

When do we know if and when the so-called economic soft landing starts turning into a hard landing recession? We’ve called for a soft landing for over a year and that was not part of the consensus at that time. Now that we are in what would appear to be a soft landing scenario, the […]

Jerome Powell, the Chair of the Federal Reserve, gave a policy speech from Jackson Hole, Wyoming on Friday. It’s traditionally a wonky time for economists and those that follow the Fed. Without dissecting all his pros and cons as it relates to inflation and the future of interest rates, I’d focus on just one statement […]

China is in an economic air pocket with the associated turbulence. The property market, which makes up over 60% of the wealth of the Chinese consumer, is in a deflationary spiral. Property prices in key markets have been dropping. 1 Wages have flattened, with income increases matching income decreases. 2 Inflation in China is non-existent […]

One of my customs is to read at least twenty and perhaps closer to thirty earnings reports a quarter. The management commentary is a literal treasure trove of great macroeconomic data as CEO’s and CFO’s often comment on their business and what’s helped and what’s hurt. One thing I’ve noticed missing recently from earnings reports […]

The Wall Street consensus call for a recession appears to have faded. Various investment banks have been changing their calls as of late: Goldman Sachs: “The probability of a U.S. recession in the coming year has declined, as recent economic data signal that bringing inflation down to an acceptable level will not require a downturn” […]

The Federal Reserve raised interest rates for the eighth time in the last twelve months. Going from 0% to 5.5% is now the fastest and highest rates have been in 22 years. We should be at, or near, the very end of the Fed’s rush to raise rates in an effort to combat inflation. 1 […]

Second quarter earnings season kicked off with a slightly weaker set of results than expected. According to FactSet, 18% of S&P 500 companies have reported results so far. These companies have posted a blended earnings per share decline of 9% on a year-over-year basis, compared to an expected decline of 7%. 1 The weak start […]

It’s been a long slog for those of us living in the “inflation is transitory” camp.  We’ve gone a little quiet over the last year as inflation persisted and actually accelerated.  The “base effect” or year-over-year change from 2021 to 2022 didn’t provide any relief. Finally, we are seeing transitory take center stage, once again, […]