March 7, 2023 | Daily JAM, Mid Term |
According to Fannie Mae’s latest survey of consumer sentiment, less than one-third expect their personal financial situation to get better over the next year. That’s the lowest positive percentage in a series that goes back more than a decade. This isn’t good news for anyone worried about a recession in 2023 or 2024.
July 22, 2022 | Daily JAM, Morning Briefing |
Today I’m adding shares of the ProShares Short Russell 2000 ETF (RWM) to my Volatility Portfolio on the belief that the bounce of the last week is over ahead of the Federal Reserve’s July 27 meeting. I expect that the central bank will raise interest rates by 75 basis points at that meeting (although a 100-basis-point increase remains an outside possibility.) A 75-basis-point increase, far larger than the Fed’s standard 2-basis-point hike or even the “we’re serious” 50-basis-point increase, will be an admission that the central bank doesn’t think inflation is under control. And I further think the Fed will say something to the effect of “Inflation remains stubbornly high.
Those two pieces will be enough to revive fears that the Federal Reserve will raise interest rates further in 2022 and is likely to produce a recession sooner rather than later. I’m using the Russell 2000 small cap index as my volatility vehicle here because this index tends to be the most sensitive of the major indexes to shifts in investor sentiment. And I’d therefore expect the biggest reaction to a revival of recession fears from the Russell 20000.
September 1, 2019 | Daily JAM |
... some things in the financial markets will be so similar to what they were before the Labor Day holiday that you might think you were never away at all. Not everything, though. Yes, the U.S.-China trade war will still be hanging fire. And the tariffs on $112...
August 28, 2019 | Daily JAM, Morning Briefing, Volatility |
Recessions have a huge "sentiment" component in their causation. Consumers and CEOs look around at the economy, assess their feelings about the future economy, and decide that the prudent course is to cut back on spending to prepare for the coming economic downturn....
February 14, 2019 | Daily JAM, Morning Briefing, Short Term |
Overall retail sales fell 1.2% in December from November, according to the Commerce Department. That's the worst drop in nine years. Economists surveyed by Bloomberg had projected a 0.1% gain in retail sales. Out of the gate stocks fell today on the news with the...
January 30, 2019 | Daily JAM, Mid Term |
Today the financial markets are in love with the idea that the Federal Reserve will raise rates no more than once in 2019--and more likely zero. And that the central bank will re-examine its policy of letting its balance sheet run off to the tune of $50 billion a...