In recent news, several significant events have unfolded:
- Pelosi calls on Trump to postpone the State of the Union address: WSJ
- UK’s May survives a no-confidence vote: BBC
- Jack Bogle, the pioneer of the index fund, passes away at 89: CNBC
- ISIS attacks US forces in Syria, raising concerns about US withdrawal: CNBC
- US economy is ‘flying blind’ due to the partial government shutdown: Brookings
- Half of the debt in investment-grade bond funds is rated just above junk: WM
- Business inflation expectations dropped to an eight-month low of 2.0% in January: Atlanta Fed
- Import prices in the US fell in December, marking the largest drop since 2016: CNBC
- Fed’s Beige Book reveals rising concerns among US businesses: WSJ
- US homebuilder sentiment increases in January after hitting a three-year low: MW
Could the ongoing budget negotiations deadlock within the US government trigger a recession? In typical circumstances, such a notion would seem far-fetched. However, these are far from ordinary times.
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UK’s May faces confidence vote following a significant defeat on Brexit: BBC
Economic challenges mount for the US as the government shutdown continues: NY Times
China injects a record amount of capital into its economy to stimulate growth: CNBC
Odds of dying from an opioid overdose exceed those of dying in a car accident in the US: USA Today
Antarctica is losing ice at an unprecedented rate, endangering coastlines: Axios
Henry Kissinger predicts resolution in the US-China trade conflict: KraneShares
Wholesale inflation in the US declined in December, yet the annual pace remained steady at +2.5%: MW
NY Fed Manufacturing Index shows a significant slowdown in growth for the manufacturing sector in December: Reuters
Economic output is projected to slow down moderately, according to the latest estimates for the government’s fourth-quarter report on gross domestic product (GDP), which will be released later this month. The current update reflects a marginal improvement compared to two weeks ago.
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Polls indicate a decline in public support for Trump’s government shutdown strategy: Fox
Officials prepare for dire scenarios if the shutdown persists: Bloomberg
Goldman Sachs forecasts a slowdown in US growth but sees no recession in 2019: CNBC
UK Prime Minister May faced a devastating defeat in the Brexit vote: Bloomberg
Germany’s economic growth fell to a five-year low in 2018: BBC
China plans additional stimulus measures to combat economic slowdown: Reuters
Investment from China into the US has nearly come to a standstill: CNN
US GDP growth for Q4 2018 is projected to decelerate to 2.6%, according to surveys: WSJ
Consumer inflation expectations remained steady at 3% for December: NY Fed
Securitized real estate stocks in the US led the markets, showing significant gains among the major asset classes last week, as indicated by a set of exchange-traded products.
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Republican Senator Graham urges Trump to reopen the government: Reuters
China’s exports saw the biggest drop in two years in December: Reuters
China’s trade surplus with the US grows to a record high: CNBC
Eurozone industrial output experienced a sharp decline in November—the biggest drop since 2016: Reuters
UK’s Prime Minister May is making a last-ditch effort to support her Brexit deal: BBC
Trump threatens Turkey with severe economic consequences over the Kurdish situation: Politico
Investors are focused on declining corporate earnings growth projections: WSJ
Decrease in demand for sedans is heavily impacting the US auto industry: Bloomberg
US consumer inflation decreased in December, marking the first drop in nine months: CNBC
By Kathleen Day
Review via Kirkus Review
After the financial crisis of 2008, former business journalist Day (Business Administration/Johns Hopkins Business School; S&L Hell: The People and the Politics Behind the $1 Trillion Savings and Loan Scandal, 1993) recounts how Queen Elizabeth II inquired of the London School of Economics faculty why the crisis went unnoticed. They answered, saying it stemmed “principally from a collective failure of imagination among many intelligent individuals.” As the author illustrates, both national and international economic systems involve numerous astute individuals who often fall short, and given the political landscape, these failures are likely to recur. Day adeptly chronicles a sequence of crises that should have imparted crucial lessons but instead bred further troubles—for example, tariffs or Andrew Jackson’s dismantling of Alexander Hamilton’s national banking system. The narrative emphasizes efforts to separate banking from investment, a distinction Franklin Roosevelt described as “speculation with other people’s money.” Each time these sectors are separated, politicians eventually rejoin them, heralding new crises.
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Although a week of trading provides limited insights about price trends, if we focus only on the 2019 calendar, the beginnings look promising. However, the implications of this data are minimal. Still, as a form of financial entertainment, it offers a light distraction amidst the turmoil in Washington and the ongoing shutdown drama.
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Senate Majority Leader McConnell blocks House bills aimed at reopening the government: The Hill
Government employees will miss their first paychecks today due to the shutdown: TPM
Trump suggests he might invoke emergency powers to construct the wall: Reuters
Fed Chairman Powell warns that a prolonged government shutdown could impact the economy: CNBC
Debate within the Fed regarding its bond portfolio and assets is intensifying: WSJ
A survey reveals that the risk of a US recession has risen to 25%, the highest level in six years: Bloomberg
Flu season is projected to cost employers $17 billion: CG&C
US jobless claims continue to indicate strength in the labor market: Reuters
Oil prices have rallied for nine consecutive sessions—the longest winning streak on record: MW
December marked the 59th consecutive month of net inflows into ETFs and ETPs globally: ETFGI
