Will the Fed Cause Another Recession?
The Fed raised the Federal Funds Rate by 25 basis points (a quarter of a percentage point) to 1.0%. This is the anchor rate on the yield curve, and, most other rates respond to it, with shorter rates today responding more than longer rates. It appears from their communications that they intend to hike rates […]
Why Helicopter Money and Unconventional Monetary Policies Won’t Help the Economy
The equity markets continue to flirt with record highs while the yields on fixed income instruments are at or near all-time historic lows. Generally, those two market movements are not compatible. Everyone feels a high level of anxiety about the economic future. Ben Bernanke visited the Bank of Japan in early July to help them […]
Rising wages: Is Wal-Mart a precursor?
Originally published on Reno Gazette Journal’s website, http://www.rgj.com/story/money/business/2015/03/06/rising-wages-wal-mart-precursor/24537471/ For the past 18 months, the labor markets have been telling us to be bullish on the U.S. economy as the healing in that market precipitated economic strength. Those who could read those signals had a significant time advantage in the markets, as those signs emerged months […]
Fiduciary vs. suitability standard
Originally published on Tahoe Daily Tribune’s website, http://www.tahoedailytribune.com/news/opinion/15276182-113/tahoe-truckee-market-beat-fiduciary-vs-suitability-standard President Obama is pushing the Department of Labor to make some changes to the rules regarding retirement accounts. He would like to see the industry standard for retirement account advisers raised to what’s known as the fiduciary standard. Under current law, retirement account advisers can operate under […]
Outlook for 2015: First Half U.S. Growth Accelerates
In 2013’s end of year missive, we commented that 2014 would be an up-beat year for the U.S. economy, and it looked like that could last through 2015. Now, as we near the last days of 2014, we see an even stronger underlying economy for 2015 and believe that it will last through 2016 […]
Why “Average” Wage Rates May Be Misleading
Much has been made of Fed Chair Janet Yellen’s stance that the labor market still has a lot of slack. That message remained in the Fed’s September communique. As part of her justification, the Chairwoman points to the fact that the average hourly wage rate has remained at or near the “official” rate of inflation, […]