A very strong US dollar provides yet another headwind for earnings. Meanwhile, from a historical perspective, this bear market may only be about half way done in terms of time and perhaps price, too. Our defensive recommendation has paid off this year and now represents a momentum trade; stick with it. Stronger dollar poses another…...
Cross-Asset Strategy: While growth risks are elevated, our base case looks for an acceleration in global growth in the second half of the year, led by China, and a moderation in inflationary forces that should allow central banks to pivot. Last week’s strong US jobs print should allay concerns that the economy has already slipped…...
Macro Strategy—Volatile Times Ahead: Untethered money-supply fluctuations have created a new, more volatile environment for asset allocation. Until the Federal Reserve (Fed) reins in the sharp swings in liquidity, uncertainty and inflation will likely prove more volatile than during the pre-pandemic, low-inflation era. More uncertainty and higher inflation volatility increase the need for a well-diversified,…...
Key talking points Bank of America aggregated credit and debit card spending was up 11% year-over-year (YoY) in June. Meanwhile aggregated card spending per household was up 3.3% YoY in the 28-days ending June 30th, down from 4.0% YoY at the end of May. Higher inflation, especially rising gas prices, continues to squeeze consumers. Consumer…...
Fear dominates in times that are especially uncomfortable. Bear market, recession, yield curve inversion, whatever….Negative focus/thinking is a self-perpetuating prison of the mind. The trader has control over their situation. The successful ones actually use it. ~Jonathan Harrier If you would like to watch this week’s State of the Market video, please click the provided…...
The S&P 500 finished the month of June down -15%+ over the last 3 months and -20%+ over the last 6 months. It was a dreadful first half of the year, the worst first half of the year since 1962, and only slightly worse than 1970. If it sounds awful, it has felt even worse…...
Behavioral Finance tells us that you can broadly think of your happiness as just “Reality minus Expectations”. H = R-E; or said another way, are things going better for me than I thought or worse? If you aren’t expecting these selloffs to happen you get upset, reality smacks you in the face and your happiness…...
Key talking points We take a look at how consumers have historically adjust their spending during recessions and compare these findings to what Bank of America high frequency aggregated credit and debit card data is telling us right now. Our analysis suggests the consumer is not displaying the usual recessionary patterns at this time. Interestingly,…...
Research Report Excerpt #1 From May 20th to May 27th, the market rallied greater than 6%. One step forward, but unfortunately that resulted in 2 steps backward and new lows for the major averages in June. Nonetheless, these types of outsized weekly gains usually hold strong forward returns out 3-12 months. The key seems to…
The S&P 500 (SPX) rallied sharply this past week, gaining 6.45 percent. This is the second 6%+ weekly gain in just the last 4 week period. It’s rather remarkable, as we revisited such a feat of strength in our latest State of the Market. The question, given the frequency of this weekly occurrence is to…...
