The number of publicly listed U.S. companies has significantly decreased, from 7,300 to 4,300 in the last 30 years. At the same time, the number of private companies has risen fivefold. Per a Bloomberg article entitled The Stock Market Is Becoming A Dumping Ground, Jamie Dimon attributes the decline in the number of public companies […]
Following the Fed’s somewhat aggressive 50 bps rate cut two weeks ago, the stock and Fed Funds futures markets started to get ahead of themselves. Accordingly, market participants expected the aggressive pace of easing to continue through the remainder of 2024. At one point the Fed Funds futures market was implying the Fed could cut […]
Over the last month, China has injected its economy with an incredible amount of monetary and fiscal stimulus, which has resulted in extreme optimism in its stock market. As we share below, the Hang Seng Tech index and the broader China stock market CSI 300 index are up 30-40% over the last few weeks. The […]
The Fed got a welcome bit of news on Friday with the PCE price index. The Fed’s preferred measure of inflation fell to 2.2% on a year-over-year basis. That is the lowest reading since February 2021. The Fed’s 2% inflation target for PCE is now within reach by as early as year-end. However, the core […]
Bloomberg cites economist Richard Koo, who claims China is in a balance sheet recession. A balance sheet recession, as defined by Koo, is as follows: He defines a balance-sheet recession as a situation in which households and businesses divert more of their income toward paying down debt, rather than consuming or investing. Koo argues that […]
At last week’s FOMC meeting, Jerome Powell clearly stated that recent signs of labor market weakness were an important factor in cutting rates. Therefore, assuming inflation continues to decline, the strength or weakness of the labor market will likely determine how much more they cut the Fed Funds rate. The well-followed BLS, ADP, Jobless Claims, […]
“The Fed will spur another round of inflation with rate cuts.” That line and similar sentiments have been plastered all over social media following the Fed’s aggressive 50 bps rate cut. Given the importance of inflation on asset returns, it is worth looking back at the last 40 years and appreciating the relationship between Fed […]
With a staff of over 400 economic Ph.D.s and seasoned leadership, many believe the Fed has a firm grasp on future economic and inflation trends. Accordingly, they must have a good idea of what the future holds for interest rates. Unfortunately, we share a little secret: the Fed’s latest Fed Funds forecast makes little sense. […]
We’ve previously written that electricity demand is projected to outpace capacity over the next decade. The 20-year power purchase agreement signed between Microsoft and Constellation Energy, announced last Friday, highlights the potential for nuclear energy to meet the surging power demands from AI data centers. Constellation Energy will reopen the Three Mile Island reactor shuttered […]