Executive Summary Is $28 trillion in United States government debt not enough?  The answer is “no”, as the Congressionally approved deficit spending will require an increase in the U.S. debt limit.  The debt has grown no matter which political party controls the White House (see first graph).  [...]

Executive Summary Last week the stock market took a roller coaster ride while bonds took a hit. The 10-year Treasury Note yield rose to 1.46% based mainly on two factors:  the Fed’s announcement of tapering their monthly bond purchases beginning late this year and the second is [...]

Executive Summary Monday’s stock market move may have seemed a bit extreme. Many financial pundits will speculate as to the cause; however, sometimes they are correct and other times it is just speculation. This move appears to have been the contagion effect from China’s Evergrande Group, whose [...]

Executive Summary Despite massive stimulus and extreme monetary policy, the “expansion” period between the Great Recession and the Covid19 recession experienced the weakest post-WWII growth rate, at 2.3% average annual growth (see second graph), on record. While the Fed keeps “printing” money (3rd graph), the Federal deficits [...]

Executive Summary This week’s update is brief, so a summary may seem unnecessary.  The two main points are the disappointing 235,000 new jobs reported on Friday of the holiday weekend, and the Atlanta Fed’s revision lower of the third quarter GDP forecast.  The jobs number was a [...]

Executive Summary Last week all the economic focus was on what Fed Chairman Powell would say at the Jackson Hole meeting. It seems the Fed, as usual, allowed itself enough wiggle room with no real time commitment, and investors decided to opt for a bullish interpretation. The [...]

Executive Summary The bond market is often considered a better indicator of the economy than the stock market. Currently the 30-year Treasury yield has fallen to 1.87%, and the 10-year Treasury Note yield is down to around 1.25%. (See the second graph illustrating the 10-year Treasury rates [...]

Executive Summary Benjamin Graham, the father of value investing and mentor to Warren Buffett, in December 1959 commented that at the peak of all bull markets, “past experience” only represents the “sunny side of the investment”. And he also indicated the sentiment that the market has always [...]

Executive Summary The Jobs Report released last week reported 943,000 new jobs, and the markets and media celebrated.  What the headline did not reflect was the actual loss of 133,000 jobs, which then was seasonally adjusted (part of the calculation) to arrive at the nearly one million [...]

Executive Summary Most investors take a myopic view of economic growth. When viewed in isolation, second quarter real annualized GDP growth of 6.5% sounds outstanding. However, GDP growth per capita remains below trend (second graph below). For the economy to grow, there must be either productivity growth, [...]