The Capital Spectator: Insights on Investing, Asset Allocation, and Economics

It is both unwise and inappropriate to grieve for those who have fallen. Instead, we should express gratitude to God for their existence.
— General George S. Patton

Last week, U.S. equities saw an upswing, closing on Friday just shy of a record high. The gains made through May 26 represent the strongest weekly performance among the key asset classes, as evidenced by a variety of exchange-traded products.
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● Grave New World: The End of Globalization, the Return of History
Review via Prospect
Stephen King, a Senior Economic Adviser at HSBC, has penned a timely book, *Grave New World*, serving as an insightful guide to the evolving global economic landscape. His work combines contemporary economic analysis with historical insights written in a clear and (mostly) jargon-free style.
King contends that the globalization we have witnessed over recent decades is susceptible to reversal. The distribution of benefits from globalization has been markedly uneven, both within and among nations.
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Smart beta: 2017 global survey findings from asset owners
FTSE Russell
May 22, 2017
What is the trajectory of smart beta adoption? FTSE Russell’s fourth annual survey of global institutional asset owners reveals that smart beta adoption has reached an all-time high. The survey indicates that 46% of asset owners now report having an existing smart beta allocation, up from 36% last year. Over the past three years, the increasing global growth and application of smart beta has been evident, with European adoption at 60%—higher than North America and Asia Pacific.
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April marked a challenging period for the housing market. For the first time in a year, both housing starts and sales of new and existing homes saw declines on a monthly basis. This downturn resulted in the year-over-year change dropping to an 18-month low. Given housing’s vital role in economic growth, this slowdown raises concerns, although other sectors are exhibiting signs of strength. Nonetheless, the lukewarm housing market cannot be easily overlooked in business-cycle analysis.
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The Federal Reserve is anticipated to raise interest rates again in June, a move likely to further compress the Treasury yield curve. The gap between the 10-year and 3-month yield is currently the smallest since last October, and another rate increase could narrow this difference even further.
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Despite a modest increase in first-quarter GDP growth, several estimates indicate a strong acceleration in Q2 is on the horizon.
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Foreign government bonds in developed markets surged last week, showcasing the strongest performance among the major asset classes, based on a set of proxy exchange-traded funds.
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● Who Stole Our Market Economy?: The Desperate Need For Socioeconomic Progress
By A. Coskun Samli
Summary via publisher (Palgrave Macmillan)
This book addresses the current state of our market economy, controlled by financiers and billionaires who diminish competition and consumer power. To ensure that society can flourish, higher living standards and quality of life must be universally accessible without favoritism. The author highlights the pressing issues of economic inequality, poverty, and the dismantling of the middle class, advocating for a progressive market economy to counterbalance regressive conservatism. He warns of potential economic collapse, unrealistic legislation, widespread unemployment, and class conflict if a fair and functional system is not established.
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Political instability in the U.S. is rising, yet economic risks remain minimal. The chaos surrounding President Donald Trump challenges the sustainability of his administration’s pro-growth agenda. However, it’s questionable whether the economy is truly at risk due to this heightened political tension, as current statistics do not indicate any macroeconomic strain.
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