Chart Of The Week: The Softening Labor Market

The latest JOLTS report showed the lowest levels of quits since early 2018 when Core PCE inflation was around 2%. The quit rate is a good measure of labor market tightness. The disinflationary trend that was dominant in 2023 is still very much intact.

Median Household Income In March 2024

Median household income increased in March 2024. Motio Research estimates the income earned by a typical American household increased by $906 (+1.2%) from its initial estimate of $77,265 for February 2024. The year-over-year growth rate of median household income has been essentially flat since September 2023.

Fed Watch: Push It Back, Push It Back, Way Back

Fed Holds Policy Steady: Rate Hikes Remain 'Unlikely' Despite Lack Of Inflation Progress

Fed Holds Policy Steady: Rate Hikes Remain 'Unlikely' Despite Lack Of Inflation Progress. The Federal Reserve left its policy rate unchanged and argued its policy stance is in a good place. But officials are concerned about the recent lack of progress on inflation. Powell says an interest rate hike is "unlikely"

The Fed Moves To Preserve Liquidity, But Investors Should Remain Cautious

The Federal Reserve announced a reduction in the quantitative tightening program, selling fewer US Treasuries and potentially leading to lower interest rates. Market reaction to the changes in quantitative tightening was muted. Investors should monitor metrics such as money supply, overnight reverse repo activity, and liquidity to ensure inflation does not reignite.

Fed Holds Rates Steady, Powell Doesn't See The 'Stag' Or The 'Flation'

Federal Reserve leaves rates unchanged as inflation progress stalls, pushing rate cuts expectations further out. Fed Chair Powell adopts a more dovish tone, mentioning stalled inflation progress. Powell dismissed the possibility of a rate hike and emphasized the strength of the economy. The QQQ is a buy.

10yr/Mortgage Ratio Implies Market Rise Coming

National 'Debt' Issue Needs More And More Attention

Kenneth Rogoff warns against "magical debt thinking" and calls for developed countries to rebuild fiscal buffers and ensure debt sustainability. Too much government debt can slow down economic growth and disproportionately harm low- and middle-income citizens. The U.S. Has $34.6 trillion in government debt.

U.S. Recession Warning Via States Economies Was A False Alarm

Recession Probability Falls After Hitting Double-Top

The probability the U.S. Economy will see a recession begin sometime in the next 12 months has started to fall after hitting a double-top. Recession Probability peaked at 81% in July 2023. The expected timing of rate cuts by the Fed has been slipping later and later during the past six weeks.

U.S. Employment Costs Reacceleration Incentivises The Fed To Be More Hawkish

US labour costs accelerated in the first quarter, led by the government sector. Hikes to state minimum wage levels contributed to higher private sector labour costs. This is the Federal Reserve’s favoured measure on labour market inflation pressures. Slowing quits rate suggests easing wage pressures... Eventually.

May Day Fed Day

Stocks Sink In April As Inflation Fears Rise

The S&P 500 fell significantly in April, giving back a chunk of the year's gains. Higher interest rates amid hotter-than-expected inflation and growth data weighed on stocks big and small. The only area to finish in the green was the defensive Utilities niche.

Yen Retreats, While Stronger EMU GDP Underscores Nascent Recovery And Lifts The Euro

Stronger-than-expected eurozone GDP strengthened the sense that a nascent recovery may be taking hold and has given the euro a bid in the European morning. Japanese stocks rallied strong coming back from the long weekend. Australia's unexpected weakness in retail sales has weighed on the Aussie and Kiwi currencies. Emerging market currencies are mixed, with Turkey and Hungary leading the advancers.

Mega Forces: Why They Matter Now

Geopolitical risk has escalated in the Middle East. Hiroshi Watanabe sees escalating tensions in the region as a sign of a new geopolitical regime. He says mega forces, structural forces, are the right lens to look at the world. Watanabes says a productivity boom from artificial intelligence could ease supply constraints in the economy.

GRPM: Strategy Change Prompts Huge Returns For This S&P MidCap 400 GARP ETF

Invesco S&P MidCap 400 GARP ETF has been one of the top-performing mid-cap funds. The fund changed strategies effective August 28, 2023. GRPM has tracked the S& p midCap 400 index since May 1, 2013. The growth and value combination of the fund beats nearly every other fund in its category. Backtested data indicates GRPM's outperformance is an anomaly.

A Good Start To 2024

Many financial markets hit record highs in the first quarter of 2024. The S&P 500 Index of stocks of large US companies hit a record high late in January. The annual rate of inflation has slowed since its 2022 peak but is still above the Federal Reserve’s 2% target.

The Media Infotainment Complex Strikes Back

The Canada - U.S. Rate Divergence And The Implications For Markets

Home Market Outlook Economy Analysis The Canada - U.S. Rate Divergence And The Implications For Markets. Michael O'Brien, managing director and head of the core Canadian equity team at TD Asset Management, looks at the likelihood of a divergence in US and Canadian interest rates and the potential impact on the economy.

Too Early To Call Stagflation

Home Market Outlook Economy Analysis Too early to call Stagflation. Economic growth in the first quarter came in at 1.6 percent, well below expectations. But inflation is stuck on a plateau, and the Fed is not likely to raise interest rates, says John Sutter. Sutter says stagflation was a buzzword in the 1970s.