Over the last week, some of the largest and most well-followed investors, also known as whales, turned bullish on bonds. The largest whale is famed hedge fund investor, billionaire, and philanthropist Stanley Druckenmiller. A week ago, Druckenmiller, speaking at the Robin Hood Foundation conference, said he was taking “massive leveraged positions” in two-year Treasury notes. […]
The October labor report, released Friday, indicated slowing job growth in the US last month. The economy added 150k jobs in October versus a consensus estimate of 180k. A sharp decline from the 297k jobs added in September, and although the media is touting a “goldilocks labor report,” the numbers are more concerning under the […]
Almost a month ago, on October 7th, Hamas attacked Israel, and concerns of a much larger war in the Middle East spiked. War worries weighed on stock prices and irked the bond markets. With a few weeks to better assess the war situation and the many possibilities, the markets seem less worried. To wit, the […]
In the November FOMC statement, Chairman Powell and his colleagues at the Fed did as the market expected. Not surprisingly, in a unanimous decision, they left the Fed Funds rate at 5.25-5.50% and made minimal changes to the statement from the prior meeting, as shown below. The Fed continues to threaten another rate hike but, […]
The Bank of Japan’s (BOJ) policy meeting on Tuesday resulted in a shift away from yield curve control (YCC). Per the BOJ: “With extremely high uncertainties surrounding economies and financial markets at home and abroad, the Bank judges that it is appropriate to increase the flexibility in the conduct of yield curve control so that […]
The growth of the global economy and the value of the world’s financial assets are a function of interest rates. Interest rates are the cost of money. The cheaper money gets, the more investments into all sorts of assets make sense. Politicians and central bankers clearly understand this relationship. As we have seen since the […]
False narratives are stories market pundits tell to justify market actions. Sometimes, they are factual. Oftentimes, legitimate-sounding false narratives are incorrect. Yesterday’s Commentary took bond market false narratives to task. Specifically, one which claims foreign debt holders, specifically China and Japan, are selling sizeable amounts of U.S. Treasury bonds, which forces Treasury yields higher. We […]
The September NFIB Small Business Optimism Index (blue) fell to 90.8 from 91.3, remaining near the lowest levels since the financial crisis. The forward-looking NFIB business outlook (orange) dropped to -43. Such is above the low registered in mid-2022 but below levels reached during the financial crisis. 23% of small business owners deem inflation as […]
Shares of Coke and Pepsi were down about 5% on Thursday and trending lower as Ozempic and other obesity drugs become popular. Unfortunately for Coke, Pepsi, Mcdonald’s, and other companies, users claim they eat less food. Walmart confirmed initial reactions, saying its customers taking Ozempic and other appetite-suppressing drugs are purchasing less food. Drugs like […]