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October 2017 Economic Overview

October 2017 Economic Overview

Our economy continues on the longest economic expansion in American history, well prior to the recent presidential election, at a pace of around 2%, about as much that is sustainable longer term. Weather related problems may slow the pace, but the trend is well established and is likely to persist. Home construction is modestly increasing held [...]

September 2017 Economic Overview

September 2017 Economic Overview

America is a confused place today. What has gone wrong is a decline in trust, as defined as the expectation that other people will act in ways that are fair to you. Since Trump’s electioneering and his election, there is precious little of trust about. After his Charlottesville performance, he shows himself to be politically inept, morally [...]

August 2017 Economic Overview

August 2017 Economic Overview

The US economy entered the ninth consecutive year of expansion. GDP for the second quarter increased by 2.6% and there are no signs that this trend might change. Since mid-2009, GDP growth has averaged 2.1%, while earlier years averaged over 3.6%. The difference is that today’s economy is vastly larger than those of the 1980s and 1990s. [...]

July 2017 Economic Overview

July 2017 Economic Overview

Reducing unemployment without sparking inflation is the Holy Grail of the Fed. Mid-June the Fed raised rates by a quarter point (range now 1-1.25%). With an inflation target of 2%. But unemployment is below the “Natural” rate and seems to be permanent at 4.3%. It is possible that inflation will take off when unemployment gets too low, such as [...]

June 2017 Economic Overview

June 2017 Economic Overview

The Fed is likely to raise rates yet again, but perhaps not this month. It is looking to trim its $4.5 trillion balance sheet which will influence it interest rates hikes. Housing starts have been puzzling in that costs are rising and sales are slow. Jack Welch ex GE Chairman observed that our great economy risks being eroded by the toxic [...]

May 2017 Economic Overview

May 2017 Economic Overview

Global growth is expected to be 3.4% this year. Janet Yellen says that we need fresh ideas and investments that can raise the output per worker, spend more on roads, bridges, and other infrastructure projects, change tax regulations, increase investment in infrastructure and in people. Avoid new trade barriers that hinder global competition. Above [...]

March 2017 Economic Overview

March 2017 Economic Overview

The dollar is the world’s principal anchor currency, and the dollar standard is one of the most vulnerable pillars of global stability. It has grown more important as the world has globalized. After The fracturing of this system under inflationary pressures in the 1970-80s, the dollar became more central than ever. As markets opened to [...]

February 2017 Economic Overview

February 2017 Economic Overview

Navigating a Fed tightening cycle, a divergence between economic and profit performance, and significant patience with respect to a rollout of fiscal stimulus, forgetting international relations for the moment, will be critical drivers to equity performance in the new year. We expect the dollar to remain firm based on the relentless widening in [...]

January 2017 Economic Overview

January 2017 Economic Overview

The US Dollar is 40% above its lows in 2011, its sharpest rise ever against a basket of rich-country peers. This latest surge is in prospect of a shift in economic policy mix in America. Trump will cut taxes, and spend more public funds on fixing our crumbling infrastructure. Such a big fiscal boost will lead the Fed to raise rates at a far faster [...]

December 2016 Economic Overview

December 2016 Economic Overview

Go figure. President Trump! President elect Trump promises to reduce regulations, increase infrastructure spending, and cut taxes, which lead many to conclude that growth in inflation and interest rates will result. He has sworn to ‘Put America First. Demanding respect from a freeloading world that takes leaders from Washington for fools’. [...]

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