Review via The New York Times
The key question explored in “The Code,” authored by Margaret O’Mara, is how an otherwise ordinary suburban area transformed into a powerhouse of global influence. O’Mara, a historian with a knack for engaging writing, not only examines the technological innovations of Silicon Valley but also focuses on the individuals and policies that facilitated their triumphs.
She delves into the region’s history, emphasizing the pivotal role of Stanford University. After World War II, Fred Terman, an electrical engineer and Stanford’s provost, reshaped the university to align with his vision. By promoting the fields of science and engineering, he helped Stanford secure significant federal funding that propelled the growth of the Cold War.
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Yield Curve and Financial Uncertainty: Evidence Based on US Data
Efrem Castelnuovo (University of Melbourne)
June 2019
How do short and long-term interest rates react to a surge in financial uncertainty? We explore this by performing a local projections analysis using US monthly data from 1962 to 2018. The innovative financial uncertainty measure developed by Ludvigson, Ma, and Ng (2019) effectively predicts shifts in interest rates across various maturities. Notably, an increase in financial uncertainty results in a significant negative response from both short and long-term interest rates. The impact on short-term rates is found to be more pronounced than on long-term rates. Thus, a sudden financial uncertainty shock leads to a temporary steepening of the yield curve, implying that there may be medium-term expectations of a recovery in real economic activity following such a shock.
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Tropical storm prompts evacuations in Louisiana: WSJ
Tariffs affected China’s exports in June: Reuters
Ongoing tensions in the US-China trade dispute: Bloomberg
Eurozone industrial output exceeded expectations in May: FT
Turkey receives its first shipment of controversial Russian missile systems: NY Times
IEA forecasts a return of oil glut in 2020: CNBC
US jobless claims dropped to a three-month low last week: Bloomberg
Core consumer inflation in the US unexpectedly rose to +2.1% in June:
Federal Reserve Chairman Jerome Powell testified before Congress yesterday indicating that an interest rate cut may be on the horizon. This news is welcomed by the bond market, providing a potential boost for continued rallies in fixed-income assets.
Iranian boats attempted to intercept a British tanker: BBC
Flood risk escalates for millions due to a storm in the Gulf of Mexico: CNN
Oil prices hit a six-week high amid tensions with Iran and the Gulf storm: Reuters
Fed Chairman Powell informs Congress that the central bank is prepared to reduce rates: WSJ
Former US ambassador to China declares tariffs on China the ‘new normal’: CNBC
Business inflation expectations drop to 1.9%, matching a two-year low: Atlanta Fed
US government prepares for the arrest and deportation of thousands of undocumented immigrants: NY Times
Federal Reserve minutes support the case for a rate reduction: Bloomberg
Core inflation in the US shows signs of easing in June:
In the realm of investing, behavioral risk stands out as one of the most significant threats to even the best strategies. The difficulty is amplified when attempting to predict your reactions during challenging market conditions. This uncertainty can be exacerbated if your only experience with a particular fund or strategy has been during a rising market. While there are no straightforward remedies to this dilemma, one can begin to alleviate some uncertainty by conducting a basic econometric analysis on return distributions.
Trump seeks ways to weaken the US dollar: Bloomberg
US plans to form an international coalition to patrol the Strait of Hormuz and surrounding waters: BBC
Will the Fed revise its policy based on trade issues? Reuters
Trump softens his stance on China’s handling of Hong Kong to reignite trade discussions: FT
Mexico’s finance minister resigns over policy disagreements with the president: WSJ
China’s inflation remained at a 15-month high in June: SCMP
US job openings eased in May but still near record levels: MW
As we approach the publication of preliminary second-quarter economic data in less than three weeks, updated forecasts are adjusting expectations for US economic growth. The latest predictions indicate a noteworthy slowdown in Q2 growth, according to projections compiled by The Capital Spectator. This adjustment reflects growing concerns over the risk of recession in both the US and global economies.
US and China preparing to restart trade negotiations: Reuters
Wall Street speculates on the US pursuing a weak-dollar policy: Bloomberg
US lawmakers diverge from Trump’s criticism of the Fed chair: WSJ
Hong Kong leader declares controversial extradition bill is dead: CNBC
Are central banks equipped to tackle a global recession? NY Times
Rental demand climbing at the expense of home purchases: CNBC
US consumer credit showed growth in May for the second consecutive month: MW
The 10-year/3-month Treasury yield curve remains negative for the seventh consecutive week:
In addition to managing my role at The Capital Spectator, I now contribute a series of articles for The Milwaukee Company, where I focus on risk, portfolio management, and the various elements involving the financial landscape. The topics are extensive, offering endless opportunities for analysis, and the journey begins with small steps. For those interested, I’ve prepared a brief primer on basic risk metrics applied to portfolios to help distinguish valuable assets from the less favorable.
