The latest economic data presents a picture of a stable US economy, suggesting that the Federal Reserve can maintain its current monetary policy without adjustments. However, a deeper examination of important trends in the Treasury market and the monetary base—alongside the economic struggles facing China that are beginning to affect the global landscape—indicates that the outlook may be far more uncertain and perilous than many believe when considering potential rate adjustments.
China is increasingly at risk of an economic crisis: CNBC
Sanders maintains a significant lead in the latest national poll: CNBC
Trump announces several pardons and sentence commutations: Politico
China expels three Wall Street Journal reporters: NY Times
The global economy is turning away from China due to the virus outbreak: WSJ
Hong Kong is facing its first consecutive annual recession: Bloomberg
Is Bloomberg LP for sale? It’s possible if Mike Bloomberg becomes president: WSJ
The NY Fed manufacturing Index rose to a nine-month high in February: MW
US home builder sentiment showed a slight dip in February but remains strong: NAHB
US economic activity is projected to slow during the first quarter, according to the median predictions from a series of nowcasts compiled by The Capital Spectator. This current forecast indicates the lowest quarterly gain in over a year, although the anticipated growth remains robust enough to sustain the economic expansion as we begin 2020.
Continue reading
China will grant tariff exemptions on 696 US goods: Reuters
How quickly will China’s economy recover from the coronavirus outbreak? Bloomberg
Research indicates that the coronavirus could affect 50,000 firms: CNBC
Despite Brexit disruptions, UK employment rose in Q4: Bloomberg
HSBC, Europe’s largest bank, plans to eliminate 35,000 jobs: WSJ
German economic sentiment plummeted in February due to coronavirus concerns: ZEW
Apple is not expecting to meet its quarterly revenue target because of the coronavirus: BBG
The WTO’s trade barometer anticipates a “further weakening” of trade in Q1: WTO
The real estate sector is thriving – in fact, it’s experiencing sizzling growth based on trading activity from last week. Both in relative and absolute terms, US REITs demonstrated remarkable performance for the week ending Friday (February 14) — achieving the most substantial gains among the major asset classes measured through a variety of proxy ETFs.
Continue reading
Concerns about coronavirus risks aboard cruise ships are increasing: Reuters
A fierce storm is affecting Western Europe: CBS
Japan’s economy contracted sharply in Q4: Bloomberg
Iran’s hardliners are expected to gain power following this week’s elections: Reuters
The Munich Security Conference highlighted the growing divide between the US and Europe: Politico
In tech investing, success is driving further investment: WSJ
US consumer sentiment has risen to its highest point in nearly two years: Bloomberg
US industrial production saw a continuing decline in January: MW
Retail sales registered modest growth in January: CNBC
The change in US commercial & industrial loans dropped to a two-year low in January:
By Alexis Wichowski
Summary via publisher (HarperCollins)
In this thought-provoking book about our emerging tech-driven reality, political insider and technology expert Alexis Wichowski examines the unchecked rise of tech giants like Facebook, Google, Amazon, Apple, Microsoft, and Tesla—termed “net states”—and their significant influence on our lives. These entities, rivaling nation-states in terms of power and resources, are intruding into our physical environments with digital services that often go unnoticed and at times remain unknown. They are reshaping the world, jeopardizing our rights concerning privacy and national security.
Continue reading
A New Index of the Business Cycle
William B. Kinlaw (State Street Global Markets), et al.
January 2020
The authors introduce an innovative business cycle index that utilizes the Mahalanobis distance to gauge the statistical similarity of current economic conditions to past periods of recession and strong growth. This index boasts several key characteristics that set it apart from the Conference Board’s leading, coincident, and lagging indicators. It is efficient, serving as a single index that conveys reliable information about the business cycle’s trajectory. This independent index provides an unbiased assessment since it is built from distinct variables compared to those employed by the NBER to identify recessions. Being entirely data-driven, it remains unaffected by personal biases. The index expresses an objective evaluation of the business cycle based on statistical likelihood and takes into account the interaction, as well as the level, of the economic variables used in its construction.
Continue reading
Attorney General Barr critiques Trump regarding tweets about the Justice Department: ABC
The CDC director warns that the coronavirus is “likely to persist beyond this season”: CNN
Tensions are escalating between Turkish and Russian-supported Syrian forces: NBC
Eurozone GDP growth slowed in Q4, falling short of earlier estimates: Reuters
Is Europe’s largest economy ready for trade and coronavirus risks? BBG
Core consumer inflation in the US firmed up in January: CNBC
Gold prices have risen as the nomination of a gold-standard advocate for the Fed faces challenges: THill
Historically, the US economy navigated a similar soft patch back in 2012-2013. Is the current situation truly different? This reflects a pertinent question as the global economy grapples with the spreading coronavirus, which heavily impacts China and is increasingly reverberating throughout economies worldwide. For instance, the European Commission recently identified the coronavirus as a significant downside risk to the bloc’s economy.
In summary, the state of the economy reflects a mixture of stability and apprehension. While current indicators suggest smooth sailing for the US economy, underlying challenges—especially those emerging from international markets like China—highlight the need for careful monitoring as we move forward. As we assess economic policies and potential shifts in monetary strategy, acknowledging these complexities will be crucial for navigating the potential risks ahead.
