The obstacles to a full recovery have been identifiable for some time: Viral resurgence, long-term unemployment, supply chain dislocation. We still expect these are temporary challenges, but all are proving more durable than we had hoped. The Delta strain of
This July, we find ourselves looking back on a half a year of upside surprises. As the year started, we expected an better run than we had in 2020, which was a low standard to surpass. Rapid progress distributing vaccines
It’s been great to see the economy reopen, releasing a tremendous surge of energy. But anxieties remain: Will the economy overheat? Are we on a course toward runaway inflation? Will the workforce return to its former size? While these are
Weekly Economic Commentary: I watched the film “Apollo 13” again recently. For those too young to remember, a mission to the moon that launched 50 years ago almost ended in disaster; working feverishly, ground control was able to bring the
Investors are keenly focused on the risk of inflation, as higher bond yields would hurt both stocks and bonds. Over the last week, inflation data came in hotter than expected, yet both bonds and stocks rallied. It looks like our
Financial markets have rapidly priced in higher long-term inflation rates — close to or above central bank targets. Is our “Stuckflation Tested” five-year theme at risk of failing? We don’t think so. It will take years for the current cyclical upswing in inflation to become entrenched, if it happens at all.
The rally in global equity markets since November has been driven importantly by an optimistic outlook for management of COVID-19, and recent developments suggest this outlook is coming to pass.
When you find yourself in a hole, stop digging.” This time-tested maxim can work well for finding a path out of personal debt. Small behavioral changes can allow people to stop running up credit accounts and start paying them down. But when the “hole” represents …
Dark Before The Dawn Economic Outlook for 2021 Few will look back wistfully on 2020. COVD-19 did tremendous damage to public and economic health around the world. Unprecedented medical and fiscal responses established a recovery, but progress has been uneven
The pandemic has been top of mind for everyone throughout the year, especially during its most uncertain initial stages in the spring. For me, the sad situation was illustrated by one unforgettable sight. I have the fortune of living near
In an environment marked by rapid market swings, investors looking to consistently outperform will have to increase their emphasis on downside protection while maintaining their upside participation.
Global Investing Of course, the impact of next week’s elections in the US goes well beyond the economic and financial realm, but from our narrow angle, we will follow the results across two dimensions. One is volatility: whether a winner
Weekly Economic Commentary Eleven years ago, I had the pleasure of witnessing my wife’s naturalization ceremony. The presiding judge opened with a memorable comment: “Swearing in new citizens is the only time everyone leaves the courtroom happy.” Everyone present nodded.
U.S. Economic & Interest Rate Outlook The pandemic has made indoor activities and gatherings risky. During the summer, outdoor adventures and backyard socializing were effective workarounds. But as autumn takes hold, the cooling air will gradually limit those options. This
Weekly Economic Commentary IN THIS ISSUE: Curing What Ails U.S. Healthcare Child Care Is A Global Economic Issue When It Comes To The U.S. National Debt, History Will Not Repeat No one can avoid the doctor’s office forever. Whether for
Scenario Analysis: Planning Strategies for all Political Outcomes As the 2020 United States elections on November 3 approach, the enactment of new legislation and regulations are likely to depend, in large part, on whether there is a unifed or divided
Since the global financial crisis, interest rates have been anchored at unprecedented lows. At the same time, stock and bond investments have produced positive returns along with bouts of significant volatility. This has left many investors questioning long-held return expectations
Investment Perspective The relentless run in risk assets over the last five months finally faded a bit in early September, as the S&P 500 fell nearly 8% and the tech-heavy NASDAQ fell 11%. This year’s returns have been heavily influenced
In recent years, global equities had slightly outpaced market forecasts for lower equity returns. Then the COVID-19 pandemic hit the global economy, putting an end to the 10- year bull market. Equity markets have now started to recover, but the
The battle between public health officials and COVID-19 continues, and, as we had feared, cases in the United States increased significantly in recent months. However, global economic …
The Role Of Gold A Less Than Perfect Inflation Hedge Gold has been on a tear over the last year, rising 32% while global equities have languished. Investors buy gold for many reasons, but a common objective is a hedge
Europe and the U.S. Consider State Aid Is China’s Rebound Sustainable? Mortgage Rates Hit Bottom
Just months after one of the sharpest drops ever, stock markets globally are nearing cycle highs as most economic data continues to show repair. Fiscal stimulus and income support programs have supported consumer spending over the last several months, as
The first wave of the economic recovery from the pandemic has generally exceeded expectations. Policy interventions in the form of large fiscal packages, asset purchases and government loan schemes have prevented household and business failures. Economies appeared well-positioned to recover
Insurance AUM Journal Companies globally are slashing dividend payments as they face a combination of declining revenues and regulatory measures discouraging …
Risk Insights Series We are in a new era of extreme volatility that is leaving investors searching for new ways to achieve the same portfolio objectives. In an environment marked by …
The upward march in financial markets and economic activity has been quite rapid in recent months, resembling a V-shaped recovery. Risks to a continuation of that unabated recovery have emerged recently in the U.S., as COVID-19 case counts are now
Weekly Economic Commentary Carl offers thoughts on the progress of the pandemic. I belong to an international economic association that meets annually during the summer. We had been set to gather in Madrid earlier this month, but COVID-19 forced …
Overoptimism? Global financial markets have rocketed back from their late-March lows, with the S&P 500 briefly in positive territory for the year. Why are the financial markets performing so much better when the economy is still so weak? Financial markets
COVID-19 is a global pandemic, and while the experience has varied across countries, we are seeing some common threads. Indicators over the past month have suggested that the worst of the downturn is behind us. Industrial activity is resuming, businesses
Companies globally are slashing dividends as they face a combination of declining revenues and regulatory measures discouraging dividend payments. Not surprisingly, companies are now prioritizing liquidity and solvency over returning capital to shareholders. While dividends are being eliminated or suspended,
In this issue The Jobs Data Doesn’t Add Up Yes, Brexit Is Still An Issue Frustration For Food Producers
Weekly Economic Commentary I grew up on the South Side of Chicago in the 1960s. The latter part of the decade was a challenging time for our city, and for our country. I lived close to the University of Chicago,
Point of View Companies globally are slashing dividend payments as they face a combination of declining revenues and regulatory measures discouraging dividend payments. Not surprisingly, companies are now prioritizing …
Weekly Commentary Timing is everything. We want to hit the road just ahead of rush hour. We enjoy perfectly ripe fruit, and a perfectly cooked steak. (And a perfectly aged wine to go with it.) We seek to deliver jokes
Investment Strategy Commentary There has been increasing focus on whether the U.S. stock market is too “top heavy,” with an over-reliance on the top technology stocks. We think business fundamentals should …
After weeks in lockdown, many major economies are easing restrictions to reboot economic activity. Unfortunately, they are faced with a difficult tradeoff between lives and livelihoods. A slow reopening will limit a renewed viral outbreak, but will also prolong the
Investment Perspective Risk assets have rallied strongly over the last seven weeks as policy actions have been forceful, COVID-19 cases have peaked in important areas and investors have been willing to look past the short-term economic …
This month, we are watching economic data catch up to the difficult circumstances. We could see in our daily lives that the economy was approaching a standstill; now, we can begin to understand the extent of the economic impairment. With
Investment Perspective Risk markets have rallied strongly since the fourth week of March, reflecting a collision of positive policy developments and bearish investor sentiment. After a one-month decline of 34% in the S&P 500, we have experienced a snap-back rally
Countries across the globe are slowly starting the process of loosening public health restrictions in their efforts to restart economic growth. Meanwhile, we received a positive surprise about a COVID-19 treatment that will likely become one part of the building
Investment Strategy Commentary Oil's Winners & Losers; Remdesivir's Data Countries across the globe are slowly starting the process of loosening public health restrictions in their efforts to restart economic growth. Meanwhile, we received a positive surprise about a COVID-19 treatment
We love tales of successful entrepreneurship. We admire tech titans who start by cobbling together computers in a parent’s garage, researchers who spend years perfecting and then producing revolutionary medical therapies, and small people with big ideas who overcome serial
Investing Strategy Commentary Health Policy Remains the Key Aggressive action by the Federal Reserve has helped restore some liquidity and animal spirits to financial markets, while fiscal policy is starting to kick in despite cumbersome transmission mechanisms in some cases.
The Fed Opens the Floodgates Supporting the Workforce Though the Crisis Australia’s Record Expansion Is Ending
KEY POINTS COVID-19, declared by WHO as a global pandemic in March after rapidly spreading to Europe then to North America, triggered historic movements in the fixed income markets and put an end to the record long U.S. bull market.
Before “normal” was redefined by COVID-19, I spent a fair amount of time traveling to give presentations. (So much, in fact, that my wife used to joke that I should change my address to the airport, because that is where
Global Economic Outlook COVID-19 continues to wreak havoc on global financial markets and the global economy. Nations and cities around the world are in lockdown. Vast amounts of economic activity have come to a standstill. As a result, most major
Investment Strategy Commentary Market Signals We have written about the key market signals we are monitoring to assess the effectiveness of the monetary, fiscal and health policy responses to the COVID-19 virus. We are seeing some progress on the monetary
Closing Strong The month of March brought an onslaught of news requiring a daily reassessment of risks. The signs of recession are spreading: empty roads, closed stores, cancelled flights, postponed events and idled workers. Today’s circumstances defy comparison to any
