Weekly Commentary

Within just a couple of weeks (September 20-21), the Fed will reconvene to determine the amplitude of the Fed Funds rate. Most market participants are expecting a ¾ point rate increase, while we believe a ½ point increase is still in the cards. 1 I’ve focused on interest rates above other issues (Ukraine, China, Energy, […]

Equity markets reacted violently to Fed Chairman Powell’s recent comments. U.S. equity markets shed over $1.2 trillion in one day when participants decided to reprice the trajectory and pace of interest rates. 1 The summary of what he said should not have been shocking; yet it was. The Fed is going to: Raise rates until […]

I completely understand we are still in the doom and gloom phase of the current economic growth detour. It’s far too early to declare the coast clear from headwinds real and imagined. With Q2 earnings season effectively over, companies fared much better than expected. S&P 500 companies grew earnings by 6.7%, compared to the 4% […]

Last week’s report on consumer prices finally gave a little respite to the onslaught of inflation news. The month-over-month change in consumer prices was zero, with a moderation in the year-over-year rate. 1 Energy prices were the main contributor to the easing of inflationary pressures. 2 Further, prices for hotels, airfares, wholesale gasoline, and producer […]

The latest jobs report for July crushed all estimates. The U.S. economy added 545,000 total jobs last month, with almost every category adding jobs. 12 The number of jobs added per month over the last year has been a remarkable 526,000 on average. 3 This latest report confirms the full recovery in private sector jobs […]

The U.S. economy posted its second consecutive quarter of negative GDP growth. 1 If you review our Q3 2022 Look Ahead, you can see the outcome was highly predictable. The question is are we in a recession? According to the Bureau of Economic Analysis, an independent federal agency that provides official macroeconomic and industry statistics, […]

This week the Federal Reserve will put its’ next installment in place to fight inflation that it mostly can’t impact. They will raise the Fed Funds rate by 75 bps and much of that is to diminish consumer demand in hopes of cooling inflationary pressures. The Fed readily admits it cannot influence supply. Fed Chair […]

The U.S. Dollar, relative to other countries, has been on a tear in the past year. The U.S. trade weighted dollar is up over 10% this year and nearly 20% off the bottom in 2021. 1 The strength in the U.S. Dollar is always relative to how other countries’ currencies are viewed. Relative to most […]

We kick off Q2 earnings season this week, and it should be the bottom of the earnings cycle. 1 Expectations are for S&P 500 earnings to come in around 4.3% for the quarter, marking the weakest earnings report since pandemic earnings in Q4 2020. Going forward earnings expectations trend back to much more normalized levels: […]

Our Q3 2022 Look Ahead is available for review. The video link is here and the PDF version is here. In this post, we highlight some key themes we see in the coming quarter. We think we are in the midst of a growth cycle detour. 1 We believe we will have a period of […]