Wall Street Journal (July 13)
“U.S. consumer inflation accelerated to 9.1% in June, a pace not seen in more than four decades, adding pressure on the Federal Reserve to act more aggressively to slow rapid price increases throughout the economy.” But there are also reasons to think inflation will be coming down as “investor expectations of slowing economic growth world-wide have led to a decline in commodity prices,” consumer spending is shifting, and excess inventory has retailers warning “of the need to discount goods, especially apparel and home goods.”
Tags: 9.1%, Aggressively, Commodity prices, Consumer spending, Discount, Economy, Excess inventory, Expectations, Fed, Growth, Inflation, Investor, June, Price increases, Retailers, Slowing, U.S.
Bloomberg (April 18)
“The slower the Fed, the harder the landing.” Quick action while inflation expectations are “still well anchored” will minimize the “cost in terms of foregone output and higher unemployment.” Those costs will mushroom if the Fed “waits and allows inflation expectations to get out of hand.” A recession remains unlikely in 2022, but if there isn’t one “in the next couple years, it will only be worse.”
Tags: Anchored, Costs, Expectations, Fed, Inflation, Landing, Output, Quick action, Recession, Slower, Unemployment, Worse
Forbes (April 5)
“Deutsche Bank on Tuesday became the first major bank on Wall Street to forecast a recession next year, albeit a ‘moderate’ one, thanks to the combination of surging inflation and rising interest rates.” Expectations are increasing for “a possible economic downturn on the horizon, with alarms growing louder after the widely-observed yield curve inverted last week and indicated a looming recession.”
Tags: Deutsche Bank, Economic downturn, Expectations, Forecast, Interest rates, Looming, Recession, Surging inflation, Wall Street, Yield curve
Institutional Investor (December 14)
“Investors are proceeding with caution as central banks move to rein in inflation. Expectations of more aggressive monetary policy have prompted investors to adopt more defensive asset allocation strategies…. In addition to piling into cash, investors have also adopted more defensive positioning by overweighting healthcare stocks and underweighting assets that are exposed to interest rate hikes.”
Tags: Aggressive, Asset allocation, Cash, Caution, Central banks, Defensive, Expectations, Healthcare stocks, Inflation, Interest rate hikes, Investors, Monetary policy, Overweighting
Boston Globe (April 27)
“A grand experiment is about to take place in office buildings across Greater Boston, as many businesses begin reopening their offices to employees with newfound expectations around working from home.” The results are unknown, “but a significant majority of office employers are poised to move away from mandating the five-day, in-person workweek.”
Tags: Boston, Employees, Employers, Expectations, Five-day, Grand experiment, In-person, Office buildings, Reopening, Working from home, Workweek
Financial Times (February 13)
“Investors poured a record $58bn into stock funds this week while slashing their cash holdings, in the latest sign of the fervor sweeping global financial markets…. Historically low interest rates and expectations for a big rebound this year in global economic growth have whet investors’ appetite for riskier assets,” but this is creating unease among some that “asset prices have become overextended.”
Tags: Assets, Cash holdings, Economic growth, Expectations, Fervor, Financial markets, Interest rates, Investors, Rebound, Riskier, Stock funds
Investment Week (May 23)
“The resignation of leader of the House of Commons Andrea Leadsom has accelerated expectations of the departure of Prime Minister Theresa May, who is set to step aside or be forced out within days.” The Prime Minister is “facing opposition throughout Parliament and even in her own cabinet.”
Tags: Cabinet, Expectations, Forced out, Leadsom, May, Opposition, Parliament, PM, Resignation, Step aside
FX Street (December 17)
“USD/JPY, which fell particularly hard today should test 112.40 pre-FOMC but a move below that level may not happen until after the rate decision…. The economy is not doing as poorly as what is reflected by stocks and rate hike expectations…. Barring significant dovishness, any pullback in USD/JPY could be short-lived. Other currency pairs like EUR/USD and GBP/USD are a different story.”
Tags: Dovishness, Economy, Expectations, FOMC, Pullback, Rate hike, Stocks, USD/JPY
Wall Street Journal (August 23)
“The Fed has been able to slowly and predictably raise interest rates this year because the economy has performed largely in line with its expectations, but Wednesday’s minutes show how trade uncertainties loom large for U.S. businesses and Fed officials.”
Tags: Businesses, Economy, Expectations, Fed, Interest rates, Trade uncertainties, U.S.
Institutional Investor (August 6)
“For the world of institutional investing, the topic of our time is none other than fees.” Most of the solutions being touted, such as 1-or-30, are anything but revolutionary. “Any magic is really just sleight-of-hand meant to distract us from realizing how low our expectations are for any meaningful improvement in the existing misaligned fee structures.” We must overcome this built-in bias and “expand the window of possible choices to include those that will be seen as utterly unthinkable by today’s standards.” For example, a “rent” system could be adopted in which “the allocator no longer pays fees to the manager for the use of its own capital and is assured of receiving the investment outcome it seeks (i.e., the negotiated rent). The manager gets the capital and potential revenue it needs to run its business.” Such a revolutionary move would place the risk directly where it belongs: on the asset manager.
Tags: 1-or-30, Allocator, Asset manager, Capital, Expectations, Fee structures, Investing, Outcome, Rent, Revenue, Revolutionary, Risk
