The Capital Spectator: Investing, Asset Allocation, and Economic Insights

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    <p>This month has brought notable changes to the long-term performance outlook for the Global Market Index (GMI). In March, there was an uptick compared to the <a href="https://www.capitalspectator.com/total-return-forecasts-major-asset-classes-4-march-2024/">previous month</a>. The latest revised forecast suggests an expected annualized return of 6.9% for the unmanaged benchmark. This index encompasses all major asset classes, excluding cash, and is determined using market weights through a series of ETF proxies.</p>

    <p><a href="https://www.capitalspectator.com/total-return-forecasts-major-asset-classes-2-april-2024/#more-21913" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/total-return-forecasts-major-asset-classes-2-april-2024/" title="6:58 am" rel="bookmark"><time class="entry-date" datetime="2024-04-02T06:58:50-04:00">April 2, 2024</time></a>
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    <p>* Gold prices hit a <a href="https://www.cnbc.com/2024/04/01/gold-prices-hit-new-record-high-on-fed-cut-expectations.html">new record high</a> on Monday<br/>
    * The housing market remains the Fed’s <a href="https://finance.yahoo.com/news/housings-outsized-role-in-the-feds-inflation-problem-morning-brief-100031015.html">primary inflation concern</a> lately<br/>
    * Expectations for European stocks are considerably underestimated, according to advice from JP Morgan analysts <a href="https://www.ft.com/content/2445a82a-500f-422f-827c-706dc1cd0348">here</a><br/>
    * US construction spending <a href="https://www.rttnews.com/3436040/u-s-construction-spending-unexpectedly-sees-further-downside-in-february.aspx">declined</a> for the second consecutive month in February<br/>
    * Eurozone manufacturing continued to contract in March: <a href="https://www.pmi.spglobal.com/Public/Home/PressRelease/9979ccbb91c4477c8d43a59d8a999285">PMI survey</a><br/>
    * The <a href="https://www.ismworld.org/globalassets/pub/research-and-surveys/rob/pmi/rob202403pmi.pdf">ISM Manufacturing Index</a> for March indicates slight expansion—the first increase in 16 months:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2024/04/ism.02apr2024.png"><img fetchpriority="high" decoding="async" class="alignnone size-full wp-image-21911" src="https://www.capitalspectator.com/wp-content/uploads/2024/04/ism.02apr2024.png" alt="" width="1200" height="675"  /></a></p>
    <p><a href="https://www.capitalspectator.com/macro-briefing-2-april-2024/#more-21910" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-2-april-2024/" title="6:21 am" rel="bookmark"><time class="entry-date" datetime="2024-04-02T06:21:48-04:00">April 2, 2024</time></a>
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    <p>The rally in global assets expanded significantly in March, resulting in gains across nearly all major asset classes. The only exception was the bond sector in emerging markets. Otherwise, the month showcased a remarkable sweep of positive performance, as evidenced by a variety of ETFs.</p>

    <p><a href="https://www.capitalspectator.com/major-asset-classes-march-2024-performance-review/#more-21907" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/major-asset-classes-march-2024-performance-review/" title="7:03 am" rel="bookmark"><time class="entry-date" datetime="2024-04-01T07:03:17-04:00">April 1, 2024</time></a>
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    <p>* Inflation <a href="https://www.wsj.com/economy/global/inflation-victory-is-proving-elusive-challenging-central-banks-and-markets-cef0d601">remains</a> stubborn in the US and Europe, presenting ongoing challenges for central banks.<br/>
    * March saw the strongest factory activity in China in over a year, <a href="https://www.cnbc.com/2024/04/01/china-april-2024-caixin-manufacturing-pmi.html">according to recent surveys</a>.<br/>
    * Gold reached a <a href="https://www.cnbc.com/2024/04/01/gold-prices-hit-new-record-high-on-fed-cut-expectations.html">new record high</a> on Monday.<br/>
    * Bitcoin and the S&P 500 emerged as the first quarter’s <a href="https://www.ibtimes.com/bitcoin-sp-500-are-big-winners-first-quarter-despite-higher-bond-yields-what-next-3728600">top performers</a>.<br/>
    * The Fed’s preferred inflation metric <a href="https://www.wsj.com/economy/central-banking/fed-inflation-gauge-february-pce-f664d187?mod=economy_lead_story">rose</a> to 2.5% in February.<br/>
    * US consumer spending <a href="https://www.bea.gov/news/2024/personal-income-and-outlays-february-2024">rebounded significantly</a> in February:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2024/03/spending.01apr2021.png"><img decoding="async" class="alignnone size-full wp-image-21905" src="https://www.capitalspectator.com/wp-content/uploads/2024/03/spending.01apr2021.png" alt="" width="1285" height="652"  /></a></p>
    <p><a href="https://www.capitalspectator.com/macro-briefing-1-april-2024/#more-21904" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-1-april-2024/" title="6:18 am" rel="bookmark"><time class="entry-date" datetime="2024-04-01T06:18:51-04:00">April 1, 2024</time></a>
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    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2024/03/enough.29mar2024.png"><img decoding="async" class="wp-image-21900 alignleft" src="https://www.capitalspectator.com/wp-content/uploads/2024/03/enough.29mar2024.png" alt="" width="140" height="223"  /></a><br/>
    ● <a href="https://amzn.to/4ahL4W6">Enough: Why It’s Time to Abolish the Super-Rich</a><br/>
    Luke Hildyard<br/>
    <strong><a href="https://www.plutobooks.com/9780745348544/enough/">Summary</a> via publisher (Pluto Press)</strong><br/>
    This narrative is all too familiar. The global economy generates vast fortunes for a wealthy elite, while ordinary workers face stagnant wages, and food banks become more prevalent as public services decline. In *Enough,* Luke Hildyard contends that rather than being diligent and productive entrepreneurs, the super-rich represent an extractive force that consumes an unfair portion of society’s resources—ultimately impoverishing the rest of us in the process.</p>
    <p><a href="https://www.capitalspectator.com/book-bits-30-march-2024/#more-21901" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/book-bits-30-march-2024/" title="8:01 am" rel="bookmark"><time class="entry-date" datetime="2024-03-30T08:01:51-04:00">March 30, 2024</time></a>
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    <p>The Capital Spectator will be taking a brief hiatus for the next few days, with the exception of a new Book Bits column on Saturday, March 30. Our regular schedule will return on Monday, April 1. In the meantime, enjoy a delightful holiday!</p>

    <figure class="wp-block-image size-large"><a href="https://www.capitalspectator.com/wp-content/uploads/2024/03/easter.2024.png"><img loading="lazy" decoding="async" width="569" height="363" src="https://www.capitalspectator.com/wp-content/uploads/2024/03/easter.2024.png" alt="" class="wp-image-21898"  /></a></figure>
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    By James Picerno | <a href="https://www.capitalspectator.com/eggs-iting-for-the-easter-holiday/" title="6:50 am" rel="bookmark"><time class="entry-date" datetime="2024-03-28T06:50:50-04:00">March 28, 2024</time></a>
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    <p>* Fed Governor Waller <a href="https://finance.yahoo.com/news/feds-waller-is-in-no-rush-to-cut-rates-in-2024-220016686.html">mentioned</a> he’s in “no rush” to lower rates.<br/>
    * A delay in rate cuts shouldn't derail the rally in US stocks, said a <a href="https://www.cnbc.com/2024/03/28/dont-sweat-the-prospect-of-no-fed-rate-cuts-economist-says.html">TS Lombard economist</a>.<br/>
    * China’s surplus of clean energy products is affecting prices, as noted by <a href="https://www.cnbc.com/2024/03/27/yellen-china-solar-ev-surplus-global-markets.html">Treasury Sec. Yellen</a>.<br/>
    * The so-called Buffett Indicator is currently <a href="https://www.cnn.com/2024/03/27/investing/premarket-stocks-trading/index.html">flashing red</a> for the stock market.<br/>
    * The Japanese yen <a href="https://www.wsj.com/finance/currencies/yen-hits-34-year-low-as-hopes-for-boj-rate-increases-fade-d3d0da2d">has fallen</a> to a 34-year low against the US dollar.<br/>
    * Commodities continue to reflect an upward price trend this year:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2024/03/comm.28mar2024.png"><img loading="lazy" decoding="async" class="alignnone size-full wp-image-21895" src="https://www.capitalspectator.com/wp-content/uploads/2024/03/comm.28mar2024.png" alt="" width="900" height="396"  /></a></p>
    <p><a href="https://www.capitalspectator.com/macro-briefing-28-march-2024/#more-21894" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-28-march-2024/" title="6:28 am" rel="bookmark"><time class="entry-date" datetime="2024-03-28T06:28:02-04:00">March 28, 2024</time></a>
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    <p>The bond market continues to face challenges in fully recovering from the Federal Reserve’s extensive interest-rate hikes enacted in 2022 and 2023. Nonetheless, areas of strength are evident. Among fixed-income securities, there remains relative resilience in floating-rate securities, lower-rated loan products, and junk bonds, as demonstrated by year-to-date performance through the close on March 26.</p>

    <p><a href="https://www.capitalspectator.com/floating-rate-and-junk-bonds-lead-fixed-income-so-far-in-2024/#more-21890" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/floating-rate-and-junk-bonds-lead-fixed-income-so-far-in-2024/" title="7:33 am" rel="bookmark"><time class="entry-date" datetime="2024-03-27T07:33:58-04:00">March 27, 2024</time></a>
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    <p>* US CPI inflation is projected to remain above 3% until mid-year, predicts Garda’s Magnusson.<br/>
    * Chinese leader Xi <a href="https://www.cnbc.com/2024/03/27/chinas-xi-meets-us-execs-as-businesses-navigate-bilateral-tensions.html">met</a> with US executives amidst ongoing US-China tensions.<br/>
    * China’s industrial profits <a href="https://www.wsj.com/economy/china-industrial-profits-return-to-growth-d3530ec5">have rebounded</a> in the first two months of 2024.<br/>
    * The long-standing expansion of US businesses in China is <a href="https://www.wsj.com/business/american-companies-china-trade-exports-eb49310d?mod=hp_lead_pos4">stagnating</a>.<br/>
    * US home prices <a href="https://www.housingwire.com/articles/home-prices-showed-sustained-growth-in-january/">continue to increase</a> at a significant year-over-year pace as of January.<br/>
    * The US Consumer Confidence Index <a href="https://www.conference-board.org/topics/consumer-confidence">rose slightly in March,</a> remaining in a moderate range.<br/>
    * Durable goods orders saw a rebound in February, including this business-investment indicator:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2024/03/durables.27mar2024.png"><img loading="lazy" decoding="async" class="alignnone size-full wp-image-21888" src="https://www.capitalspectator.com/wp-content/uploads/2024/03/durables.27mar2024.png" alt="" width="655" height="410"  /></a></p>
    <p><a href="https://www.capitalspectator.com/macro-briefing-27-march-2024/#more-21887" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-27-march-2024/" title="6:24 am" rel="bookmark"><time class="entry-date" datetime="2024-03-27T06:24:01-04:00">March 27, 2024</time></a>
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    <p>Despite the recent surge in the US stock market, there are concerns about potential declines in future returns. This perspective comes from earnings yield and dividend yield models, which together estimate the ex ante equity risk premium (ERP). Recent calculations suggest that this pair continues to indicate a negative ERP.</p>

    <p><a href="https://www.capitalspectator.com/negative-equity-risk-premium-estimates-persist-for-us-equities/#more-21882" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/negative-equity-risk-premium-estimates-persist-for-us-equities/" title="7:50 am" rel="bookmark"><time class="entry-date" datetime="2024-03-26T07:50:42-04:00">March 26, 2024</time></a>
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