There has been a lot going on in markets this year. Q2 corporate earnings were up 24% year-over-year on average and stock buybacks were up over 50%. Economic growth as a measure of GDP was up 4.1%, the highest in recent years. Despite these positive trends, investors should watch out for some potential headwind. Trade Read More…
Global Market Impact on Dollar Volatility
Investors have been surprised as U.S. stocks have outperformed in 2018 relative to the rest of the world. The S&P 500 benchmark in the U.S. market is up 8% to date, while the global equity index that excludes the U.S. is down 5%. Speculators say there could be many reasons for this divergence. The United Read More…
Should the Minimum Wage Increase in the U.S.
There are many factors that must be carefully taken into account when choosing a position on whether or not the minimum wage should be raised. One must consider the positive and negative moral and scientific outcomes that could occur due to an increase in the minimum wage. Keith Knutsson of Integrale Advisors states “Although this Read More…
Equity Derivatives No More – Warren Buffett
Let’s take a deeper dive into Warren Buffets portfolio. Equity-index put options written by Berkshire Hathaway Inc. have started to expire and the remaining options will expire by January 2026. His firm originally initiated these deals between 2004 and 2008 to bet that stock prices would rise in the long run. Not only that, but Read More…
Why is the Japanese Yen Considered a Safe Haven Currency?
A risk-off can occur when global investors’ behavior becomes more risk-averse or economic fundamentals become more uncertain. The yen has shown past historical trends of serving as a safe haven currency in times of a risk-off (2008 financial crisis, 2010 distressed European market, Japan earthquake and the Italian elections). During times of increased global risk Read More…
Weaponizing Treasury Bonds: Options for Chinese Self-Destruction
Recent news mention the possibility of China negotiation leverage in tariff talks due to holding U.S. government debt. While it is true that China, the world’s second-biggest economy also is the world’s largest holder of U.S. Treasury bonds, the move for Beijing to dump its vast Treasury holdings to punish the U.S would be irrational. Read More…
Trade War Risks Lead To Gradual Rate Hikes
The Federal Reserve exemplified strong economy warranted continued increases in the benchmark policy rate while citing tensions rising with emerging-market turmoil and the trade war. As growth gets a boost from tax cuts and additional government spending, U.S. central bankers are trying to keep the economy on a substantial path. Minutes from the last Fed Read More…
What Trump Tariffs Mean for U.S. Industries
U.S. industries have been shaking with news on trade tariffs. Duties on $34 billion of Chinese goods took effect this week while China has imposed retaliatory duties of similar size on American goods. Firms like General Electric Co. are making contingency plans should a trade war ensue and also say tariffs are the wrong way Read More…
Analysis on Global Corporate Debt Markets
After the great recession in 2008, a shift in lending strategies among corporations has occurred, especially in regards to bond financing, as commercial bank lending has been minimized. Recent research suggests that of all corporate debt, nineteen percent is in the form of bonds – that’s almost twice the percentage investors saw in 2007. With Read More…
Saudi Arabia to Take Oil Consumers Side as OPEC Talks Continue
Saudi Arabia urged OPEC to help consumers by boosting oil supply as opposition from arch-rival Iran showed signs of wavering. The oil markets have been on spotlight due to the intensive negotiations between ministers in Vienna. Iran and Venezuela as they have shown disapproval towards Arabia and Russia’s desire to roll back production cuts. On Read More…