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Beige Book Signals Inflation & Healthcare Concerns Amid Modest Growth
Despite major disruptions from Hurricanes Harvey and Irma, all 12 Federal Reserve Districts indicated that economic activity increased in September through early October. Several Districts noted increased manufacturing input costs, citing storm impacts (with 58 mentions of the word Hurricane) and labor constraints (employers were having difficulty finding qualified workers), but The Fed notes healthcare service providers were less upbeat. Full Fed Summary: Overall Economic Activity Reports from all 12 Federal Reserve Districts indicated that economic activity increased in September through early October, with the pace of growth split ... -
Finance 0
Five Decades Of Middle-Class Wages: September 2017 Update
We’ve updated this series to include Friday’s release of the Consumer Price Index as the deflator and the September monthly employment update. The latest hypothetical real (inflation-adjusted) annual earnings are at $37,346, down 12.9% from 44 years ago. The Bureau of Labor Statistics has been collecting data on this workforce cohort since 1964. The government numbers provide some excellent insights on the income history of what we might think of as the private middle-class wage earner. The first snapshot shows the growth of average hourly earnings. The nominal data exhibits a relatively smooth upward trend. There are, however, tw... -
Finance 0
Comments On A Flattening Yield Curve And The Spec Record Short VIX
(Audio length 00:12:54) Chris Temple and I look at the continued flattening of the yield curve in the US – click here to visit the Fred site and see the latest yield curve chart. We discuss the factors at play that are keeping this yield curve flat. We also draw some correlations to the US equity markets and continued depressed VIX.??... -
Finance 0
Not Enough Leverage For A Recession?
With the business cycle lasting over 8 years, many are wondering when it will end. Because the last recession was so severe, people have been making a business out of spreading fear. There were two large drops in about a 10 year period making some think bull markets always end in devastation. Many people avoided tech stocks after the 2000s crash and many avoided real estate after the financial crisis. Because both crises were so close, it has led many to leave the stock market entirely. This skepticism has provided fodder for the stock market. Bull markets are built on fear and bear markets are built on complacency. Looking at the economy and... -
Finance 0
The EU Is Still Sweet On Protectionism
The European Union has finally put an end to nearly 50-years of quotas on sugar prices. Despite the seemingly good news, the measure is overshadowed by the fact that the EU not only maintains large tariffs on sugar imports, it also recently announced that it will probably continue backdoor-protectionism regardless. 50 Years of Market Distortion Sugar quotas actually have a long history in Europe. Introduced as early as 1968, sugar quotas were instituted to protect European sugar farmers from low prices by setting them considerably above the market price. In the 1990s the EU decided on a similar solution and substituted the union’s sup... -
Finance 0
Dollar Denial
At this point in the longer term process of unwinding the Fed’s prior emergency activities, the yield curve was supposed to flatten. That was the plan all along. If monetary policy was successful, or had even run into just dumb luck somewhere in the last ten years, here where policymakers declare the economy to be short rates would be moving faster than those at the long end. The flattening is taking place, to be sure, and more so over recent weeks. But it isn’t the same process as would have defined success and recovery; it is instead the opposite indication. Actual recovery would have been predicted by long rates. Sensing a real redu... -
Finance 0
4 Blue Chip Stocks To Buy Ahead Of Q3 Earnings
The Dow hit yet another landmark level on Tuesday, breaching the 23,000 barrier for the very first time to create a new intraday record. The blue-chip index ended the trading day marginally below this mark, closing at 22,998. But even so, it serves to illustrate that things haven’t been this good for blue-chips for quite some time. The current administration’s tax reform and deregulation proposals and sustained strong earnings performance are the factors powering this ascent. Such factors are unlikely to disappear in the near term, which makes it imperative to pick up some solid Dow components which are also slated to outperform their ear... -
Finance 0
Hack Attacks Are Corporate America’s Worst Nightmare
Another week, another cybersecurity incident, it seems. The latest big company to be hacked? According to QSR, Pizza Hut found itself the victim of a hack attack on October 1 — alongside approximately 60,000 customers who had their credit card info exposed. The restaurant group had a 28-hour-long “temporary security intrusion.” But whatever label we want to use, it just reinforces my point of the last two months: Cybersecurity stocks are only just getting started. Hack Attacks Guarantee Cybersecurity Profits Since I first started writing about this exciting sector on August 15 (see “Cybersecurity Profits Are Hiding in the Shadows”)... -
Finance 0
Ulta Drops As Piper Survey Shows Slowdown In Teens’ Beauty Spending
Shares of Ulta Beauty (ULTA) dropped in morning trading after the cosmetics retailer was downgraded at Piper Jaffray, which cited a survey showing a slowdown in beauty spending by teenagers. Ulta had been removed from the Conviction Buy list at Goldman Sachs earlier this week and also received a price target cut at Oppenheimer yesterday. SLOWDOWN IN SPENDING: Piper Jaffray analyst Erinn Murphy downgraded Ulta to Neutral from Overweight and cut her price target for shares to $210 from $260. In a note to clients, Murphy said her firm’s Fall 2017 Teen Survey results indicated spending declines of 13% in color cosmetics among all female tee...
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