The Federal Reserve Open Market Committee raised the fed funds target rate by 0.25% to a new level of 2.25-2.50%. This was widely anticipated, with a high futures market probability of this outcome beforehand. There were no committee dissents. The formal statement was little altered from November, noting that economic activity remains strong, unemployment remained…
At the risk of being repetitive, many of the same issues as in the last installment, with resolution still hard to find. Tariffs/Trade Despite the positive market reaction to a 90-day deferral by the U.S. in implementing a 25% tariff on a broader group of Chinese exports, this merely delays the issue, as opposed to…
Unlike the surprise result in the presidential election two years ago, that fooled pollsters and statisticians both, last week’s mid-term election results were in line with predictions—although a few surprises still unfolded. The Republicans held their majority position in the Senate, while the Democrats won a majority in the House of Representatives. However, both were…
As expected, the FOMC unanimously made no change in the fed funds target rate during the November meeting—leaving the level at 2.00-2.25%. Their formal statement offered few surprises, noting strength in underlying economic growth and labor markets. In keeping with the quarterly pace of rate movements, fed funds futures peg the chances of a hike…
The perception of the risk inherently associated with investing is ever-changing. When markets are strong and uncertainty is low, prices go up and market volatility is reduced. Of course, the opposite is true as well. Uncertain times and weak prospects can lead to an environment of low prices and high market volatility. No doubt, you…
Where should interest rates be? This has been pondered countless times over the last decade as the Fed imposed a monetary policy of extreme easing during the depths of the Great Recession, keeping interest rates near zero in subsequent years, before their the normalization process of raising them more recently. It’s important to keep in…
The current pull back in the stock market once again gives us an opportunity to remind everyone just how normal and frequent these events are. Since the end of September, the S&P 500 is down about 6.4% and the broader Russell 2000 is down about 9%.[1] Our clients have heard us preach endlessly about the…
The last few days of market turmoil may have you wondering, is a recession coming? One of many indicators that economists are watching is the yield curve. But what does it tell us? What is the yield curve? The yield curve is often referred to as an economic indicator – particularly as an indicator for a…
We don’t know about you, but there are days when we envision getting far away from the news and the disquieting things we hear each day. Fortunately, and we’ve mentioned this before, the economy and the various capital markets don’t rely solely on what’s happening in Washington. As Will Rogers reminded us so many years…
The FOMC decided to raise short-term interest rates by another quarter-percent—the third hike this year—bringing the fed funds target range to 2.00-2.25%. This was largely as expected, with formal probabilities of such a move being pegged at around 95% based on futures markets. There were no dissents. The official statement noted a continued strengthening in…