Executive Summary Historically, corporate earnings growth tends to track overall economic growth. However, for the past decade economic growth has stayed around 2% while the stock market has soared. This disconnect creates stock market bubbles, which means greater risk of loss for investors. And now, the stock [...]
Executive Summary Under normal circumstances banks pay depositors interest, and then charge interest on loaning money to borrowers. The difference between interest charged and paid represents net interest margin or net interest income for the bank. Traditional economic principles are being turned upside down in today's world. [...]
Executive Summary Does a lender paying a borrower to hold his money make any logical economic sense? In attempts to boost growth, central banks across the globe resorted to massive Quantitative Easing programs. These programs allowed the monetization of incredible amounts of government debt. As a result, [...]
Executive Summary The current economic expansion is the longest and weakest in history. Why is that? This "recovery" was sparked and maintained by unprecedented experimental monetary policy. This included printing $3.7 trillion in liquidity and dropping interest rates to zero. The result was massive expansion of debt [...]
Executive Summary The stock market moves in bull and bear cycles. Investors tend to be the most enthusiastic at the top of the bull cycle when valuations are stretched to the limit. This phenomenon is exacerbated by the "cheerleaders" on financial media rooting for a "new market [...]
Executive Summary Stock market hype or the stock market cycle, which is more important? As I have written many times before, the financial media is biased toward a positive (hype) slant - even if it means picking individual data points while ignoring the overall picture of the [...]
Executive Summary Presently, the average Joe and Jane have no idea they are living in a Potemkin Village. After the 2008 Financial Crisis, global monetary experiments were implemented to "save" the economy. The economic "recovery" resulted in a decade of 2% average real GDP growth, 36 percent [...]
Executive Summary In these Weekly Market Updates, I look "under the hood" at hard economic data and present it to our readers. This information may be in contrast to what you hear or read in mainstream media outlets. Below you will find graphs illustrating retail sales and their [...]
Executive Summary I have often written about how debt and demographics are impediments to future growth. In this week's missive, I explain how the Federal government is playing a game with its debt picture. Through some accounting gimmickry, intragovernmental debt is typically excluded from analyses of Federal [...]
Executive Summary After the end of the Great Recession, short-term rates were held to zero percent by the Federal Reserve Bank in attempts to boost economic growth through borrowing and spending. Since December 2015, the Fed has raised short-term rates nine times hoping to keep the economy [...]