A tale of two Christmas’

The 2016 Christmas run up saw the shares of retailers ( tracked by XRT, first chart ) rise an anaemic 1%, while in 2017 the same stocks BOOMED, soaring some 5.17 during the last two weeks of December. Why?

Well, MasterCard reports record Christmas spending of some $800B this year. In fact, this was [...]

So The G20 Finance Ministers are having a meeting …

In Shanghai no less, epicenter of recent market volatility. Apparently on their agenda is a discussion that will allow these nations to agree a way forward to improve global growth. The IMF is urging bold action, while China suggests is has a few tricks up its sleeve in fact more than a few , while [...]

No New Deal for America

Lots of excitement in The United States about upcoming elections. Many of the most enthusiastic are backing what might be called “outsider candidates” — Trump on the (far) right and Sanders on the (far) left. As usual, from my perspective of an ex-patriate Investment Banker-cum-University Lecturer, I tend to see things differently from my stateside [...]

US recession looming?

In the wake of The Fed’s ill-advised rate hike , speculation is growing about a US recession in 2016.

But is this probable? Yes. Parts of the US economy, for example, energy, are already in recession. Meanwhile, the US economy is already slowing and sharply.

Keep in mind that higher interest rates, theoretically, [...]

Working to Live or Living to Work?

The US economy is starting to feel wage pressure, with American median incomes (finally) back to levels last seen before The Great Recession.

So a happy end to 2016, eh? Not really. Even as incomes are rising so are expenditures. The chart below shows how much Americans spend on Health Care and Housing, divided by [...]

Depression era crisis in farming?

In spite of stereotypes about the scale and pervasiveness of factory farming, in The United States some 99% of all working farms are family farms, and most farms have annual incomes of less than $350K.

Incomes that are rapidly collapsing, by as much as 50% according to some sources.

Why? The chart below [...]

Higher government spending leads to slower growth

ok so US Q3 GDP just revised down to 2.0% from the flash number of 2.1%,. We expect GDP to further disappoint into Q4 2015 and 2016. Why?

The chart below shows the annual change in US real GDP (red line) compared to US Government Expenditures (aka, “spending”) divided by US real GDP (black [...]

Is the housing recovery over?

In spite of happy news regarding US housing, I have been pretty negative about the sector’s overall prospects and it now seems the markets are corroborating this view. The chart above shows three series directly related to the US housing market; XHB, the SPDR S&P Homebuilders Index, $DJSHMB, the Dow Jones US Select Home [...]

A teetering economy

Lots of happy news about May’s increase in durable goods, with speculation about the impact on manufacturing.

Durable goods orders is a key economic indicator as this metric leads future economic activity to no small extent. Think of it this way: as orders for durable goods are placed, businesses will either increase or [...]

Memo to Bernanke – its not working!

Capital Goods Orders are carefully studied by market analysts since this metric provides critical information about the state of the manufacturing sector.

The chart above shows Capital Goods Orders received by nondefense, non aircraft manufacturers (NEWORDER, monthly), measured as percent change year on year for the period May, 2003 to May, 2013. In [...]