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3 Charts The Fed Should Consider

Submitted by Lance Roberts via RealInvestmentAdvice.com,

This week, the Fed will meet to decide the “fate of the universe,” as they are highly anticipated to announce the first rate hike in a decade. This is a momentous occasion as it marks the end of the “ultra-accommodative” monetary policy that has been the primary driver behind asset prices since the end of the financial crisis as shown in the chart below.

Goldman Warns IG Credit Collapse Signals S&P 500 Notably Overvalued

Goldman Warns IG Credit Collapse Signals S&P 500 Notably Overvalued

The sell-off in credit over the past week has led many investors to ask what it means for equities. Credit spread widening usually has negative implications for equity but as Goldman notes,  it is critical to estimate the degree to which the equity market has already priced the weakness to determine the potential risks to equity going forward.

Salient Partners Issues A "Storm Warning" For The Market

Submitted by Ben Hunt via Salient Partners' Epsilon Theory blog,

Can everyone saying “a 25 bps rate hike doesn’t change anything” or “manufacturing is a small part of the US economy today, so the ISM number doesn’t mean much” or “trade with China is only a few percent of US GDP, so their currency devaluation isn’t important” just stop?

 

Seriously. Can you just stop?

 

16 Charts Showing Just How Confused "The Smartest Guys In The Room" Are Right Now

16 Charts Showing Just How Confused "The Smartest Guys In The Room" Are Right Now

There is just one word to describe the thought process of the "smartest guys in the room", those who manage trillions in assets and respond to BofA's monthly Fund Manager Survey: confused.

As BofA's Michael Hartnett summarizes the confusion, while on one hand only 7% expect a "recession" in the coming year...

... expectations for flatter yield curve - that surest leading indicator of a recession - just hit the highest since June of 2011:

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