ALWAYS CONSULT YOUR INVESTMENT PROFESSIONAL BEFORE MAKING ANY INVESTMENT DECISION
March 22, 2023 | Fed Today and Done?
At the last FOMC announcement on February 1st, the Fed hiked base rates by 25 bps and said it expected to tighten through 2023, with no easing before 2024, at the earliest. That was before retreating bank deposits sparked a liquidity crunch at highly levered financial institutions. Expectations are now that the Fed will hike […]
March 20, 2023 | Rates, Banking, Recession and Markets
Ted Oakley interviewed David Rosenberg of Rosenberg Research with his thoughts on banking situations, interest rates, recessions, and the stock and bond markets. Here is a direct video link.
March 16, 2023 | What Happened to Swiss Banks?
Good big picture in this segment. A global clampdown on tax evasion, led by U.S. law authorities, has transformed the banking industry in Switzerland. Without its famed reputation for secrecy, wealthy foreigners no longer see it as a haven to hide their money. So how have Swiss banks adapted? Here is a direct video link.
March 14, 2023 | Moody’s Downgrades US Banking System Outlook to Negative
Moody’s just announced a downgrade of its outlook on the entire US banking system to negative from stable to reflect “the rapid deterioration in the operating environment following deposit runs at Silicon Valley Bank (SVB), Silvergate Bank, and Signature Bank (SNY) and the failures of SVB and SNY.” Danielle explains the nuances of recent developments in the […]
March 13, 2023 | Backstops for Depositors, Not Risk Markets
The Silicon Valley Bank (SVB, founded in 1984) and Signature Bank (publicly traded since 2004) closures over the weekend are the second and third largest US bank failures in history (the largest eight failed banks in assets and deposits, are shown below). Banking failures tend to be contagious. To quell depositor fears, the […]
March 11, 2023 | Loonie and Treasury Yields Diving Together
The US dollar touched a five-month high against the loonie this week (shown below since late 2020, courtesy of my partner Cory Venable) as the Bank of Canada held at 4.5% and hawkish talk from the US Fed increased odds of a US overnight rate of 5% on March 22. With recessionary data and credit […]
March 10, 2023 | EPB Macro: The Real Reason Home Prices are Falling
Well explained, as usual. In this video, we discuss why most of the market was unable to predict the current 2023 housing crash and how this housing meltdown could continue to unfold into the rest of 2023. Here is a direct video link. In January, the combination of a 15% price cut and lower mortgage rates […]
March 9, 2023 | Fed Hangs Tough
FOMC chair Powell disappointed equity markets this week with testimony reiterating his insistence that financial conditions must keep tightening (through higher for longer interest rates and ongoing balance sheet reduction “QT”) amid growing strife throughout the world economy. Indeed, Powell unapologetically explained (and he’s correct) that higher unemployment, lower economic activity and less financial speculation […]
March 8, 2023 | DiMartino-Booth on the Economy’s Masked Collapse
Excellent data and cogent observations in this segment. Danielle DiMartino Boooth fom “Quill Intelligence” discusses the economy and what you can do to prepare for when the masked collapse happens. Here is a direct video link.
March 7, 2023 | Understanding Bond Yields and Mortgage Rates
As mentioned in the segment below, in America, more than 90% of mortgages are fixed for terms greater than ten years, and 95% of existing mortgages are at rates less than presently on offer. And yet, as shown below, since 1977, US mortgage payments to income are already at unaffordability levels seen in the last […]
March 2, 2023 | Tesla 2023 Investor Day Updates on Electrified Energy and Transportation
Tesla’s 2023 Investor Day on March 1, 2023, outlined important context and data for the global transition to electrified energy and transportation. The big-picture data presented here are not new. They have been verified and published by other scientists and engineering experts in this space, including Stanford’s Mark Z. Jacobson and The Solutions Project. And yet, most people are […]
March 1, 2023 | Rate of Change!
The US Money Supply has contracted 1.7% over the last 12 months (graphed below, courtesy of Charlie Bilello)–the largest year-over-year decline on record (data back to 1959). Many other countries, like Canada, have seen a similar trend. This massive liquidity reversal is a formidable headwind for asset markets globally over the next few quarters. At […]
February 28, 2023 | Stress Compounding at Higher Rates
Thirteen years of ultra-loose monetary conditions, followed by the sharpest tightening cycle in 40 years, have wrought record household debt service payments (in orange below, courtesy of The Daily Shot) and a record low savings ratio (grey line) Year-over-year growth in consumer debt payments since 2020 (blue line below since 1986, courtesy of Morgan Stanley) has […]
February 27, 2023 | Innovating for Smarter Energy and Transportation
Humans can be so bright and innovative when they try to be…thankfully, many people are. Renewable rooftop power will play a vital role in the decentralised community grid systems of the future. Getting every ounce of power out of available rooftop spaces will be key to making that transition a success. Now a Dutch firm […]
February 23, 2023 | Rosenberg: The Pending Recession
This segment offers another worthwhile macro overview. High-risk warning on the defence and gold mining stock “trade ideas,” as Dave says, only “for those with ice in their veins.” Word to the wise. “There’s not a snowball’s chance in hell we hit the lows in the stock market in advance of a big bond rally.” “I think […]
February 22, 2023 | Grantham: After a Timeout, Back to the Meat Grinder
GMO co-founder Jeremy Grantham’s latest market letter is worth the read as usual; see After a timeout, back to the meat grinder! On equities, Grantham’s base case is that the S&P 500 could fall a further 20% by year-end, for a total real decline of 40% since 2022. My calculations of trendline value of the S&P 500, […]
February 21, 2023 | Surging Homes For Sale and Mean-Reverting Prices
Surging home inventories and mean-reverting prices are excellent for those seeking attractive entry opportunities. But housing downcycles have historically taken an average of four years to bottom. So, patience and cycle foresight are key. The segment below offers some good insight into housing dynamics in different US cities. As in Canada, the areas with the […]
February 17, 2023 | Danielle on Monetary Policy and Markets
Danielle Park of Venable Park Investment Counsel presents her view on Federal Reserve policy, how it ties in with the policy of the Bank of Canada, and the leading indicators she thinks investors should be paying the most attention to.
February 15, 2023 | Consumers Getting Walloped
Good updates in this segment on larger trends in inflation, employment and consumption. Consumer Prices Accelerated in Jan, but Annual Growth Slowed. Here is a direct video link. Meanwhile, as shown below, half of Americans recently surveyed report that their financial situation is worse today than a year ago (dotted line below since 1975). Just 35% […]
February 14, 2023 | Battery Innovation is Booming
Innovative, hard-working people worldwide are focused on ever more efficient, low-cost energy storage, and human ingenuity is winning. NEW Sodium, Aluminum battery is 15X cheaper than sodium or lithium. Here is a direct video link.
February 13, 2023 | Hard Landing in Motion
The speakers take a few minutes to turn on their cameras in this segment, but they get there, and ECRI’s economic cycle update is always worth a listen. Big picture context is useful in avoiding common financial mistakes. Lakshman Achuthan is being interviewed by Dale Pinkert during the F.A.C.E. webinar. Lakshman is calling the pullback […]
February 10, 2023 | VRIC: Stocks, Gold and The Dollar
Our coverage of the VRIC continues with a discussion about the U.S. dollar, and it’s status as a reserve currency, including the role gold plays in protecting wealth and how the dollar’s dominance affects the broader market. Brent Johnson, Danielle Park, Grant Williams, and Russell Gray give their opinions on what is often a hotly […]
February 8, 2023 | The Financial Noose Tightens
The US Senior Loan Officer Opinion Survey on Bank Lending Practices (SLOOS) is used by monetary policymakers to gauge credit conditions. Over the past year, banks have reported tighter lending standards on commercial loans to small, large and middle-market firms (blue bars below since 1990, courtesy of The Daily Shot). This indicator has traditionally led US corporate […]
February 7, 2023 | Equity and Corporate Bond Prices Still Screaming Cycle Top!
So far in 2023, value-indiscriminate buyers are still pounding into the riskiest low-yielding assets with wild abandon. Take BBB-rated bonds-whose credit quality is just one level above “junk.” At past cycle bottoms (attractive investment opportunities), the US Fed had raised short-term rates enough that defaults spiked and BBB bond prices fell more than 20%–enough to […]
February 3, 2023 | EPB Macro: Housing Leading The Economy Lower
This segment reviews US data, but the trends are similar in Canada. The EPB Housing Deep Dive report is focused on the residential construction cycle (the leading sector of the economy). Here is a direct video link. This report is a preview of content exclusive to members of the EPB Research Gold Tier. If you would […]