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Donald Trump Or Fundamentals? Whats Irking The Bond Market
Bloomberg states: “The presidential race is still a coin-toss with two weeks to go, but Republican Donald Trump has the advantage over Democrat Kamala Harris in betting markets. His support for higher tariffs and looser fiscal policy has been seen as unfriendly to bonds because it means faster inflation and more debt.” Furthermore, the graph on the […]
Oct 23, 2024
Amazon Is Challenging The Work From Home Trend
Starting in January, Amazon workers will be expected to work in the office five days a week. While most other companies are adapting to work-from-home schedules and even offering them as a benefit, Amazon is bucking the trend. From a macroeconomic standpoint, the question that is most important is whether Amazon successfully gets its entire […]
Oct 22, 2024
Why Are Bond Yields Rising? Lets Ask The Oil Market
It’s no secret that bond yields are heavily impacted by inflation and inflation expectations. Moreover, oil prices have a high correlation with inflation. So, to answer why bond yields are rising recently, it’s helpful to check the oil price. Since May 2023, as we share below, crude oil prices and ten-year UST yields have been […]
Oct 21, 2024
Taiwan Semiconductor Nullifies ASML Fears
Wednesday’s Commentary discussed the shockingly weak booking numbers from ASML. Given that ASML is a large manufacturer of chip-making machines, we asked: “If the chip industry is facing insatiable demand, why such a stunning decline in the need for chip-making equipment?” ASML earnings introduced concern amongst semiconductor sector investors, leading many semi-stocks to decline decently. […]
Oct 18, 2024
Cava: A Hot Trend Comes At A Dear Cost To Investors
Since going public in June 2023, Cava (CAVA) has taken the fast-casual restaurant industry and Wall Street by storm. Cava describes itself as a “Mediterranean fast-casual restaurant brand that brings heart, health, and humanity to food.” As the chart below highlights, Cava shares are up 250+% since its IPO. The return is 5x its chief […]
Oct 17, 2024
MicroStrategy Is A Leveraged ETF In Disguise
Per its website, MicroStrategy “provides software solutions and expert services that empower every individual with actionable advice.” While Microstrategy’s mission description may seem like a profitable enterprise, reality has a different opinion. Since 1997, the company has a cumulative net loss of $1.108 billion. Accordingly, the graphs below show its revenue has been flat to […]
Oct 16, 2024
The Economic Surprise Index Helps Explain Higher Yields
The Fed cut rates on September 18th and many expect them to follow through with more rate cuts in the coming meetings. Yet bond yields have steadily risen. Why is this occurring? While there are many answers, it boils down to two primary reasons. As we will explain, the Citi Economic Surprise Index is rising. […]
Oct 15, 2024
JP Morgan And Wells Fargo Kick Off Earnings Season
JP Morgan and Wells Fargo kicked off the third-quarter earnings season on Friday. JP Morgan handily beat expectations for EPS and revenue. Furthermore, its charge-offs were slightly below expectations as credit quality remains solid. However, they increased their credit loss provision, as shown in the graph courtesy of ZeroHedge below. Such tells us they think […]
Oct 14, 2024
Hawkish Dovish Monetary Policy: The Feds Unusual Stance
The graph below, courtesy of Bloomberg, shows their Intelligence data rates the latest Fed meeting minutes as the most hawkish since April. Qualifying the minutes as hawkish is pretty ironic, considering the Fed’s 50bps rate cut three weeks ago was the most dovish action they have taken in a few years. Is it possible for […]
Oct 11, 2024
The VIX Is Rising With The Market: Should We Care?
The VIX volatility index spiked on the August 5th yen carry trade sell-off and has not recovered to prior lows. Since then, it has risen steadily alongside the S&P 500. Often, the VIX declines or resides at low levels when the S&P 500 is increasing and vice versa. Might the irregular VIX/S&P 500 relationship be […]
Oct 10, 2024
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