Today gold pays attention to dollar, interest rates, Fed
Sometimes it’s not so much new news that moves the market as it is a tipping point where the market decides to pay attention to what it has known all along. Today gold dropped to a three-month low to close at $1253 an ounce. That drop brings the 200-day moving...
ISM service sector survey knocks growth ball out of park (Go Cubs!)
Now that’s a strong report. This morning the ISM Non-Manufacturing Purchasing Managers Index came in at 57.1 for September. That was well above the August reading at 51.4 and above the consensus among economists surveyed by Briefing.com of 52.8. Economists...
You can read today’s inflation data two ways–which will the Fed pick?
Hope you weren’t expecting this morning’s inflation data to tell you whether or not the Federal Reserve will raise interest rates at its December 14 meeting. (I believe that an interest rate increase at the Fed’s November 2 meeting is just about a...
Q3 is almost over–will it continue the earnings recession?
Amidst the worry over global growth, interest rates, and central bank stimulus, it’s easy to lose track of the earnings picture for a third quarter that’s due to close in two-and-a-half weeks. Or maybe that’s because no one really wants to focus on...
Have bond markets finally started to have doubts about central bank commitments to endless stimulus?
I’ve been waiting seemingly forever for the financial markets to show some acknowledgement that central bank stimulus policies can’t go on until the sun turns into a dark cinder. For how long have I been waiting? More than a year certainly. But each time I...
Weak report on U.S. service sector puts another nail in coffin for September interest rate increase by the Fed
All this year the U.S. service sector has been making up for weakness in manufacturing. Not in August. The Institute for Supply Management’s non-manufacturing index slipped to 51.4 in the August survey. That’s down from 55.5 in July and is the lowest...
Weaker than expected August jobs number lowers odds of September rate increase from Fed
Take a Federal Reserve interest rate increase at the central bank’s September 21 meeting off the books. Today, the Labor Department reported that the U.S. economy added only 151,000 net new jobs in August. Economists surveyed by Bloomberg had forecast the...
Worrying manufacturing news today is anxious set up for tomorrow’s August jobs report
Manufacturing activity in the United States contracted, unexpectedly, in August, according to the Institute for Supply Management’s manufacturing index released today, September 1. The index fell to 49.4 in August from 52.6 in July. That was the biggest drop in the...
So far the markets believe the Fed was bluffing in Jackson Hole speeches on September interest rate increase
Last week Federal Reserve chair Janet Yellen tried to convince financial markets in her speech at the Fed’s annual Jackson Hole get-together that an interest rate increase at the central bank’s September 21 meeting was still a possibility. But just as the...
What the Fed’s do nothing Wednesday said about an interest rate increase in September
My family and I move every 20 years or so whether we need to or not, so on Wednesday when the Fed was making its decision to keep interest rates right where they are, I was busy unpacking all the boxes that we’d packed on Tuesday. (I’m sooo looking forward to the day...
Ignore the volatility in monthly jobs numbers–this economy is about where it should be for this point in the cycle
Here’s the smartest thing I’ve read about today’s news that the economy added 287,000 jobs in June, way more than the 180,000 consensus among economists surveyed by Bloomberg: “The bottom line is that seeing through the month-to-month...
Economy and financial markets point in different directions ahead of Wednesday’s Fed meeting
Pity the poor Federal Reserve. In making decisions about interest rates–in this case about whether or not to raise interest rates at its June, July or September meetings–it has to consider the condition of both the real economy and the financial markets. And right now...
UK voters decide to leave European Union–What’s next (Part 1 short term effects)?
By a surprisingly large margin of 52% to 48% the United Kingdom voted to leave the European Union in Thursday’s Brexit referendum. Global financial markets plunged in a decline all the more dramatic because traders and investors had decided on Wednesday that the...Who holds the most U.S. Treasuries in the world? (Hint: It's not China.)
Why is this not terribly reassuring? Last week a newcomer moved to the top of the rankings for the world’s leading holder of U.S. Treasuries. Used to be Japan, once upon a time. But Japan with holdings of $877 billion in U.S. Treasuries is now No. 3. For a while China...The Fed speaks–a day for optimism on the U.S. economy?
Could that be optimism about the U.S. economy I see in the snow? (Yes, it’s snowing again here in New York City. It snowed yesterday too.) Sure looks like it with Standard & Poor’s 500 stock index opening up this morning. The market is betting on positive verbiage...Crucial news is on the calendar this week for those who believe in a stronger than expected U.S. economy in 2011
Major events this week for those investors—and I put myself in the number—who believe that the U.S. economy will beat expectations this year—and take U.S. stocks upward with it. The Federal Reserve meets for the first time in 2011 on Tuesday and Wednesday of this week...No inflation to speak of, nothing to make the Federal Reserve change course
There was certainly no inflation to speak of in yesterday’s (December 15) consumer price data. The headline Consumer Price Index (CPI) climbed a scant 0.1% in November. The core inflation rate, which excludes food and energy prices, rose 0.1%. This puts the annual...The Fed says it will stay the course and bond yields keep moving up
Nothing surprising in the news from the Federal Reserve’s Open Market Committee yesterday. The Fed said its plans were unchanged and that it would buy $600 billion in Treasuries in the first six months of 2011 in order to stimulate the economy. The economy itself, the...Prices for 7- to 10-year Treasuries fall–if that's a trend expect money to start flowing back into stocks from bonds
For most of 2010 Treasury bonds have been a very good investment. Sure, they haven’t paid much in interest but with yields falling, Treasury bond prices have been climbing. And so the gain on the iShares Barclay 7-10 Year Treasury ETF, which tracks the price of seven...Core consumer price inflation is still on track for 0%
Inflation at the consumer level was nowhere to be seen in October. The CPI, Consumer Price Index, edged upward by 0.2% for October. In September the CPI climbed 0.1%. Economists had been projecting a 0.3% increase for October. Core inflation, that’s inflation...If we may be headed to a bubble and bust, what should we do about it?
Double double toil and trouble. The world’s financial market are only facing two witches stirring the pot, but between them they’re quite capable of adding a third bubble and bust in 2011 to the run that began in 2000 and continued with 2007. I’d be a lot less worried...Whoops! Is the Fed about to do it again? Create another asset bubble, I mean
2000. 2007. 2011. Is the Federal Reserve about to do it again? Is the Fed about to preside over the creation of another financial bubble? Asset prices in the world’s emerging economies are climbing on the crest of a flood of dollars from the Federal Reserve. Central...U.S. adds jobs in October but not enough to lower unemployment
Quantitative easing is working. Not only is it driving down interest rates, creating stock market rallies around the world and making whites whiter, but the $600 billion Treasury-buying spree announced by the Federal Reserve on November 3 produced greater than...Everybody loves Ben's $600 billion–at least in the short term
The reviews are in: Global financial markets love the Federal Reserve’s $600 billion program to buy U.S. Treasuries. And why not? In the short term, the logic goes, the Fed has pledged to support global asset prices with $600 billion in U.S. dollars. So overnight in...Are global markets happy with the Fed's move? We won't know until tomorrow
$600 billion by June. Add in the re-investment of interest and you get about $110 billion a month. The Federal Reserve’s announcement on quantitative easing came in at about the Wall Street consensus of $100 billion a month in Fed buying And as you’d expect from an...Will Wall Street be happy with $500 billion from the Fed?
The morning before the Federal Reserve announces its decision on quantitative easing, Wall Street has reached a consensus on how much the Fed will say it will spend on buying Treasuries to drive down medium term interest rates and stimulate the housing market and the...Welcome to central bank week–where the monetary policy fun never stops
Wednesday’s announcement from the U.S. Federal Reserve—how much quantitative easing and when—kicks off what I‘d call central bank week. The most important central banks–among the developed economies anyway–are set to announce interest rate and monetary...Even before the Fed acts, the long bond is signalling rising inflation worries
Something odd is happening in the bond market on the way to the Federal Reserve’s second program of quantitative easing: Interest rates at the long end of the Treasury market have started to rise. From one perspective this is counter-intuitive. The Fed is about to...Third quarter GDP comes in on projection; unlikely to change Fed's decision next week
he first estimate for third quarter U.S. GDP growth came in right on projections at 2.0%. That was up from the 1.7% growth rate in the second quarter but below the 3% or so growth rate needed to cut significantly into unemployment. Housing was the big drag on the...Jim’s Daily Email Alerts:
Every post from Jubak Picks straight to your mailbox. And they're free!