Executive Summary New Federal Reserve Chair Kevin Warsh faces a difficult decision on interest rates amid conflicting economic signals and persistent inflationary pressures. The first graph below titled Purchasing Power Erosion Table displays how even the Fed’s 2% inflation goal erodes the dollar. Despite recent declines in [...]

Executive Summary Currently stock market valuations, which are notably bad timing measures, are near all-time highs (see first graph). Investors are paying almost 2.6 times more for corporate earnings than the long-term median price. During similar times in history, investors bought stocks on margin (loans which use [...]

Executive Summary Although the University of Michigan Consumer Sentiment Index rose slightly in June, it remains near the lowest level on record (1st graph). Since Covid, goods and services prices are up 25-30% cumulatively, and they rarely decrease outside of a depression. At the same time, real [...]

Executive Summary New Fed Chair Kevin Warsh faces a difficult balancing act ahead of next week’s FOMC meeting. A stronger-than-expected jobs report, combined with elevated inflation data, has reduced the likelihood of near-term rate cuts (dovish) and increased the chances of a more hawkish policy stance. At [...]

Executive Summary Warren Buffett’s Berkshire Hathaway is currently sitting on about $400 billion of cash, and most speculate the reason is prices of stocks are too high. This week’s update will review three notable valuation methodologies for the stock market – The Buffett Indicator, the Schiller P/E [...]