Notes on the Week Ahead

The Investment Challenge from Washington Policies

The economic recovery that began in 2009 has proven its endurance many times and is now the longest expansion in history. Our base case forecast is that it will continue into 2020 and probably beyond.

New Brush Strokes for the Big Picture

The week ahead, like last week, will be crammed with important market-moving events and data points. The challenge for investors will not be in predicting instant market reactions to this new information but rather in understanding how it could change the investment landscape going forward.

Summer Sequels

The formula in Hollywood today lacks imagination. It's all about remakes and sequels. Financial markets, too, are seeing a series of sequels and a few are opening this week.

The Investment Implications of Excessive Stimulus

In the financial landscape of 2019, the Federal Government and Federal Reserve are playing the parts of over-indulgent grandparents, the markets are cast as the over-stimulated grandkids and investors are left with the role of responsible adults, having to make rational choices and knowing that they will eventually have to deal with the consequences of too much stimulus.

Chairman Powell’s Message

On Wednesday and Thursday of this week, Fed Chairman, Jay Powell, will deliver his semi-annual testimony to Congress on the outlook for the economy and monetary policy. As he prepares, while he will focus on the clarity of his message, he may well be distracted by the potential reaction of political and market audiences.

Can the Fed stop at just two rate cuts?

My wife, Sari, is an excellent cook and sometimes, when I return from a long day, I'm met at the front door by the delicious scent of freshly-baked chocolate-chip M&M cookies. The problem is, with a pair of cookies eaten but a big pile of them still smiling up at me, can I stop at just two? The Federal Reserve faces a similar dilemma when it comes to rate cuts.

Schrodinger’s Market

I should state, at the outset, that I do not profess to have any deep understanding of quantum mechanics. However, the U.S. bond market and the U.S. stock market seem to coexist in alternative realities today.

The Fed Shows its Hand

On Wednesday, the Federal Open Market Committee (FOMC) of the Federal Reserve will hold its fourth meeting of the year. The Fed is not ready to change interest rates yet.

Nice Levels – Shame about the Pace

Following Friday's May jobs report, and in reaction to slower growth, lower inflation and trouble in the global economy, the Fed is clearly taking a more dovish stance, making at least two rate cuts likely by the end of 2019.

Investing for a Middle-Case Scenario

Commercial interests dictate that the public must always be shocked or scared out of their complacency and so the "worst case scenario" will always get top billing.