China has historically been a cornerstone of growth for the global economy, but signs indicate that this stability may be waning.
* Is a cornered Russia more dangerous than ever?
* A looming food crisis threatens a “human catastrophe,” warns World Bank president
* Rate hikes could instigate a recession, warns SF Fed head Mary Daly
* Will Fed’s Powell today provide fresh guidance on the upcoming 50-bps rate hike?
* Fed’s Beige Book: The US economy exhibits moderate growth despite high inflation
* Rising bond yields are attracting bargain hunters
* US 10-year yield exceeds the equivalent in China for the first time in over a decade
* Will increasing mortgage rates cool the red-hot housing market?
* Existing home sales in the US declined for the second consecutive month in March
* US home prices reached a new record in March despite softer sales
* The inflation forecast in the US Treasury market remains significantly below actual inflation:
Economic and financial trends hold significant power, yet each emerging trend carries the potential to reverse. Substantial fluctuations in prices can prompt this shift. Predicting these reversals can be challenging due to the complexity and chaos stemming from feedback loops affecting markets and economies.
* Will Russia’s fight for the Donbas region in Ukraine determine the war’s outcome?
* The IMF has revised its growth forecast for the global economy due to the impact of the Ukraine war
* China plans to continue strengthening its strategic relationship with Russia, according to a diplomat
* China faces a self-inflicted recession due to its aggressive approach in eradicating Omicron
* Shanghai begins to ease virus control measures that have locked down the city
* Indications of declining demand for commodities are emerging
* Companies acquired in leveraged buyout (LBO) deals face risks from rising interest rates
* The Fed’s hawkish stance may cool the housing market
* US housing starts increased more than anticipated in March:
The stock market continues to be buffeted by inflation, rising interest rates, slowing growth, and the ongoing Ukraine war. However, within the equity landscape, yield and value stocks are standing out as relatively safe options this year, as evidenced by a range of ETFs through April 18.
* Russia has launched a new military offensive in eastern Ukraine
* US real Treasury yields are approaching positivity for the first time in two years
* Food insecurity driven by war is taking center stage at global finance meetings
* Analysts predict that US equities will trend upwards as inflation peaks, according to experts
* Investor confidence in Chinese economic support is waning as it may not adequately cushion against Covid-related damages
* Confidence among US home builders has dropped to a seven-month low in April
* The Fed may consider a 3/4 point interest rate increase, says St. Louis Fed’s Bullard
* The US 10-year Treasury yield continues to rise, reaching its highest point since December 2018:
Broadly defined commodities registered the only increase among the key asset classes — this conclusion is based on a range of proxy ETFs for the shortened trading schedule last week, which ended on April 14.
* Goldman Sachs predicts a 35% chance of a US recession within the next two years due to current economic trends
* China’s first quarter GDP has outperformed expectations
* China’s PMI survey results point to a continuing economic slowdown in April
* The repercussions of China’s zero-COVID policy pose an overlooked risk for the global economy
* The war in Ukraine is complicating debt repayment for emerging-market governments
* The NFT bubble is beginning to burst, according to the ‘Black Swan’ author
* The US consumer sentiment index surprisingly rebounded in early April:
Jim Cullen
Summary via publisher (Harriman House)
Value investing goes in and out of favor, yet empirical evidence remains consistent. It has always proven effective and will likely continue to do so, provided that investors adopt a disciplined approach and focus on long-term gains.
In “The Case for Long-Term Value Investing,” seasoned Wall Street expert Jim Cullen presents compelling data supporting these claims, detailing how investors can leverage value investing for success while sharing captivating anecdotes from his career on the Street.
A Look Under the Hood of Momentum Funds
Ayelen Banegas and Carlo Rosa (Federal Reserve)
February 2022
Momentum investing has gained immense traction in recent years, with assets expanding at three times the rate of traditional funds. Analyzing a comprehensive dataset of US equity funds, this paper investigates the economic value of momentum funds. Overall, findings reveal that the risk-adjusted returns of these funds are, on average, negative, primarily explained by their exposure to market factors. Furthermore, they do not enhance the performance of investors already involved with Fama-French factors.
In summary, the articles discuss the evolving economic landscape, highlighting challenges such as inflation, rising interest rates, and the implications of geopolitical tensions. They emphasize the uncertainty regarding growth prospects for major economies like China and the U.S. as well as the potential impact on investment strategies moving forward.
