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Patience Pays In Volatile Markets
Starting with a special video on Monday morning and our Daily Market Commentaries throughout the week, we continually updated readers on the excessive volatility in the markets. We wanted to stress that the volatility was primarily a function of the yen carry trade and much less other daunting issues such as the recent unemployment report, […]
Aug 12, 2024
Labor Hoarding: The Labor Market Lynchpin
According to the latest JOLTs report from the BLS, the number of job hires has fallen back to levels from 2017. Despite the rate of hires falling below the pre-pandemic trend, the labor market remains relatively strong. Why is this occurring? According to a Bloomberg article entitled The Labor Market Confronts the End of Pandemic-Era […]
Aug 9, 2024
The Bank Of Japan Calms Markets
If you want more evidence that the recent spate of intense volatility was related to the yen carry trade, look no further than last night’s market-calming comments from Bank of Japan Deputy Governor Uchida Shinichi. In fact, in contrast to the process of policy interest rate hikes in Europe and the United States, Japan’s economy […]
Aug 8, 2024
Hedging Extremes Highlight Fear
The two graphs below tell us the market was petrified on Monday and willing to pay exorbitant prices for hedging protection. Unlike prior downdrafts, fear wasn’t just expressed in sentiment and words but also by remarkable heading action. As we share below, the hedging activity was nearly off the charts. The graph on the left, […]
Aug 7, 2024
The Yen Carry Dump
CLICK HERE for a short video on the state of the markets and yen carry trade. Weak employment data, the simmering Middle East, election jitters, and many other factors are taking the blame for rattling the markets. Those are important issues, but the infamous yen carry trade is the culprit. How do we know? Some […]
Aug 6, 2024
Are The Credit Markets Cracking?
This past weekend’s Newsletter discussed how yield curve un-inversions have an excellent track record of predicting recessions. Another historically reliable indicator of recessions is weakness in the corporate credit markets. In mid-July, we highlighted a troubling divergence between the best and worst-rated junk bonds in our Daily Commentary, The Credit Widening In The Coal Mine. […]
Aug 5, 2024
The Election Nears: What Can Investors Expect?
As the election nears, investors will become more anxious about how the market may react to each candidate and their campaign promises. Accordingly, we suspect that shifting polls will breed volatility. Moreover, with President Biden dropping out of the race, this presidential election is unique. Below, we share and discuss two charts to help guide […]
Aug 2, 2024
A Fed Cut In September Nears Certainty
While it’s far from guaranteed, a Fed rate cut in September is looking increasingly likely. Wednesday’s FOMC statement changed to reflect a growing concern for the labor markets and less worry about inflation. The opening paragraph below says job gains have moderated, whereas the prior statement said job gains remained strong. They also changed the […]
Aug 1, 2024
Hedges For A Volatile Market- Answering A Reader Question
A SimpleVisor subscriber asked us a poignant question; we think the answer is worth sharing. Simply put, we were asked if we had any hedges in the portfolio and how we might hedge in the future. We currently do not have any shorts or option hedges in place. However, we have trimmed some positions to […]
Jul 31, 2024
McDonalds Issues A Health Warning
Yesterday, McDonalds issued a health warning in their earnings announcement. The warning is not about the physical health of its consumers but the customers’ financial health. McDonalds global sales were down 1%, and U.S. sales fell by 0.7% in the second quarter. Moreover, as shown below, its same-store sales have fallen for the first time […]
Jul 30, 2024
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