Market Watch (January 14)
“For investors, a meaningful erosion of central-bank independence would weaken the Fed’s inflation-targeting discipline and be negative for both stocks and bonds, as markets have long operated under the assumption that Fed independence will hold.” Although “we do not expect the Trump administration to capture the Federal Reserve, continued pressure on central-bank independence is likely to weigh on the U.S. dollar.” Ultimately, “market calm is conditional on the Senate acting as a backstop to Fed independence. If that condition is misread, markets will break down.”
Tags: Bonds, Capture, Central bank, Discipline, Dollar, Erosion, Fed, Independence, Inflation, Investors, Markets, Negative, Senate, Stocks, Trump, U.S., Weaken
Realtor.com (October 9)
Moody’s Analytics has determined that 22 states “making up nearly a third of the national gross domestic product are either in or at high risk of recession, with another third just holding steady, and the remaining third growing.” Aside from potentially lower interest rates, this doesn’t bode well for the U.S. real estate market, though Realtor.com® senior economist Jake Krimmel identifies one silver lining. “The states at highest risk, especially those located in the Northeast, happen to have the strongest housing markets right now,” while the “states with the softest housing markets…are flagged by Moody’s as having still-expanding economies. This could “limit the downturn in housing” and lessen the risk of major economic downturn provided “local economic fundamentals and housing markets don’t weaken simultaneously.”
Tags: Weaken
Bloomberg (May 19)
“‘Sell America’ is back as Moody’s pushes 30-year yield to 5%.” Just a week after traders “had to react quickly to weekend news of an improvement in trade relations between the US and China,” they will again have to paddle hard, but this time in the opposite direction. Rising Treasury yields are also expected to “complicate the government’s ability to cut back by running up its interest payments, while also threatening to weaken the economy by forcing up rates on loans such as mortgages and credit cards.”
Tags: 5%, China, Economy, Government, Interest payments, Loans, Moody, Mortgages, Rates, Sell America, Threatening, Traders, Treasury yields, U.S., Weaken
New York Times (December 26)
“Despite lingering inflation, Americans increased their spending this holiday season, early data shows. That comes as a big relief for retailers that had spent much of the year fearing the economy would soon weaken and consumer spending would fall. Year on year, “retail sales from Nov. 1 to Dec. 24 increased 3.1 percent.”
Tags: Consumer spending, Economy, Fearing, Holiday season, Increased, Inflation, Lingering, Relief, Retail sales, Retailers, Weaken
Forbes (October 18)
“Home builder confidence plunged for a tenth straight month in October as rising interest rates continued to weaken housing demand—prompting economists to warn an unexpected rise in new home sales last month may be short-lived and prices may be on the brink of collapse.”
Tags: Confidence, Economists, Home builder, Home sales, Housing demand, Interest rates, October, Plunged, Rising, Weaken
CBS News (May 13)
“The U.S. imports far more Chinese goods than China imports from the U.S. So China can’t directly impose retaliatory tariffs equal to Mr. Trump’s…. The U.S. just doesn’t send enough goods to China.” China could, however, let the yuan weaken and this may prove their best response. “If the Chinese currency were to drop in value, it would make the country’s goods less expensive in foreign markets, propping up export demand and volume abroad.”
Tags: China, Currency, Export demand, Imports, Retaliatory, Tariffs, Trump, U.S., Weaken, Yuan
