Interest rates surged last week on the back of a hotter-than-expected inflation report that wasn't actually that bad (see below). Not that my - or your - opinion about these things matters all that much to the market. In the short run, all that matters is what the majority believes is the truth. What they believed last week was that [...]
Total bank credit (blue line) vs Nominal GDP (red line) and Real GDP (green line). A lot of "analysts" were saying that the big drop in the year over year change in credit was pointing to a recession. But that isn't how this works. GDP actually leads credit - economic growth increases the demand for credit - so the rise [...]
Markets year to date have been a lot more interesting in the details than the headlines you get in the financial media. The narrative has focused almost exclusively on Artificial Intelligence and the stocks benefitting from it. Large cap growth stocks - especially in the IT and Communications sectors - have garnered all the attention. But beneath the surface markets [...]
The first quarter of 2024 is in the books and the US economy and markets continue to defy expectations, which coming into this year were that growth and inflation would both moderate and the Fed would be able (or forced, depending on how much things slowed) to cut interest rates 0.25% as many as six times this year. In fact, [...]
Special Note: I'm in Miami this week, a mix of business and personal. I lived here for 30 years and we raised our family here but we moved to South Carolina a little over 3 years ago because we were tired of the traffic and, more than that, the irritability that comes with so many people crammed into such a [...]
Over the last two years, the evolution of the US economy has been driven by a return to “normal”. The distortions of the response to COVID had a profound impact on the economy that I believe will persist for many years. The change in cash levels at the household level were large and have proved more persistent than most expected. [...]
I skate to where the puck is going to be, not where it has been. Wayne Gretzky I took my wife to dinner Saturday night at a local, boutique hotel. The Willcox Hotel was established in the late 19th century to cater to the Winter Colony of wealthy northerners who spent their winters in South Carolina. Today it still caters to [...]
How far can this rally go? Should we be locking in some gains? That's a paraphrase of questions I've been getting from clients recently. It does seem as if the stock market goes up every day and with all the ups and downs of the last few years, it is natural to wonder if we're about to get another bout [...]
Nvidia reported earnings last week and they were, to be sober about it, incredible. Total revenue rose to $22.1 billion for the quarter, up 22% from last quarter and 265% year-over-year. Data center revenue, which is what investors really ought to be watching with this company, was up 27% from last quarter and a whopping 409% year-over-year. Gross margins run [...]
Reports that say that something hasn't happened are always interesting to me, because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns—the ones we don't know we don't [...]
Stay In Touch