US Economy

06 Jun
Headline Rollercoaster: The Economic Limbo Continues
Europe and Japan continue with their easing policies as not much changes.

Chinese Purchasing Managers’ Index is positive but not far from stagnation.

US data flirts between a dead cat bounce and a stronger economic recovery.

Finding specific good investments should be the best answer to uncertain economic times ahead.

Introduction

Last week was an interesting one as it was filled with various economic news. It is important to summarize that news to see if it will move the needle as the market has moved only sideways since December 2014. More →
By Sven Carlin China Investiv Daily Japan Market Forecast US Economy
20 May
An Analysis of and the Implication of the FOMC Minutes
An interest rate increase is hanging in the air but no one seems to find enough reasons to pull the trigger.

The FOMC expects inflation to be at 2% and interest rates at 2.6% by 2018.

Holders of long-term bonds might rethink their positions as interest rate increases could have severe negative repercussions on bond prices.

Introduction

On May 18 the FED released the minutes of the Federal Open Market Committee (FOMC) meeting held in April. The FOMC decided not to increase interest rates in April which gave a short relief to the markets, but an analysis of the FOMC meeting minutes reveals interesting things because it gives indications on the way of thinking FOMC participants have and hints on potential future interest rate increases. While the goal of the FED is to maintain financial stability and increase the resilience of the financial system to shocks, for an investor it is important to look at the economic trends related to the FOMC’s decisions in order to better assess the risks of their portfolio. More →
By Sven Carlin FED FOMC Investiv Daily US Economy
13 May
The Odds for a US Recession
The current is the fourth-longest US economic expansion period with 84 months of growth.

Investment spending has been declining for the last 4 quarters.

Recession forecasts indicate increased chances in the medium term.

Introduction

The scariest word for any investor is the word recession. A recession arises when there is negative economic growth for two consecutive quarters. No economic growth makes it difficult for businesses to grow as people tend to spend less and save until better times come around. This creates a spiral as less spending forces companies to lay off employees and further cuts investments. If prolonged economic hardships persist, governments intervene with quantitative easing or with other projects to get the economy going again. A recession has an immediate negative impact on financial markets as investors become more risk averse and seek security above all. More →
By Sven Carlin Investiv Daily US Economy
09 May
How the Jobs Report Affects Stocks
The April jobs report shows two sides: slower hiring and increased working times and wages.

The long term outlook is pessimistic due to the constant decline in the labor participation rate.

Introduction

On May 6, the Bureau of Labor and Statistics (BLS) released its monthly employment situation summary.

The report is released on the first Friday of the month for the previous month. It consists of two parts: one presents non-farm payrolls, hours worked and hourly earnings, and the other is created by surveying more than 60,000 households in order to extract the unemployment rate. More →
By Sven Carlin Investiv Daily Jobs Report US Economy
25 Apr
A Broader Perspective on the Global Economy
Easing monetary policies go on globally but do not seem to fuel sustainable growth.

China is slowing, Japan is looking toward another recession, and the global outlook is adjusted downwards.

Bad news might be around the corner, but good news is as well.

Introduction

News is usually focused on the latest happenings. The fact that the human brain is set up in a way that it always tries to focus and eliminate marginal information brings to the consequence that most people do not objectively analyze the world around them. An example: How many blue cars have you seen today? Probably none because you were not looking for them, but as soon as you focus on them you will be surprised by how many you will see. The same applies to finance. More →
By Sven Carlin China Emerging Markets European Union Investiv Daily Japan Market Forecast US Economy