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

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    <p>In recent weeks, it has been easy to perceive the stock market's movements following the US midterm elections as systematically skewed upward, driven by influential factors tied to the voting process. However, this perspective may lean more toward narrative interpretation than grounded quantitative evaluation.</p>

    <p> <a href="https://www.capitalspectator.com/torturing-the-data-mid-term-elections-implications/#more-19123" 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/torturing-the-data-mid-term-elections-implications/" title="7:39 am" rel="bookmark"><time class="entry-date" datetime="2022-11-15T07:39:14-05:00">November 15, 2022</time></a>
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    <p>* Republicans are just one seat away from reclaiming the House after <a href="https://www.politico.com/news/2022/11/14/democrats-house-midterm-elections-00066765">recent voting updates</a><br/>* Fed’s Brainard <a href="https://www.wsj.com/articles/feds-brainard-says-rate-rise-pace-can-slow-soon-11668445354?mod=economy_lead_story">indicates</a> that rate increases may decelerate at the upcoming meeting<br/>* China's retail sales and industrial production <a href="https://www.cnbc.com/2022/11/15/chinas-october-retail-and-industrial-data-miss-expectations.html">show</a> weaker-than-anticipated results<br/>* Reports suggest Amazon plans to <a href="https://www.bbc.com/news/business-63628187">announce</a> significant layoffs<br/>* The global population <a href="https://www.cnn.com/2022/11/15/world/global-population-8-billion-un-intl-hnk/index.html">has reached 8 billion</a><br/>* Americans are <a href="https://www.yahoo.com/now/ny-fed-inflation-expectations-jump-160138015.html">projecting</a> higher inflation for the coming year, according to the NY Fed's October survey<br/>* Japan's economy unexpectedly <a href="https://asia.nikkei.com/Economy/Japan-GDP-shrank-annualized-1.2-in-Q3-amid-weak-yen-inflation">contracts</a> in the third quarter<br/>* Economists have raised their inflation forecasts through 2023, based on <a href="https://finance.yahoo.com/news/economists-see-us-inflation-running-100000430.html">recent surveys:</a></p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2022/11/inflation.15nov2022.png"><img fetchpriority="high" decoding="async" class="alignnone size-full wp-image-19121" src="https://www.capitalspectator.com/wp-content/uploads/2022/11/inflation.15nov2022.png" alt="" width="960" height="560"  /></a></p>
    <p> <a href="https://www.capitalspectator.com/macro-briefing-15-november-2022/#more-19119" 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-15-november-2022/" title="6:30 am" rel="bookmark"><time class="entry-date" datetime="2022-11-15T06:30:04-05:00">November 15, 2022</time></a>
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    <p>The <a href="https://www.capitalspectator.com/total-return-forecasts-major-asset-classes-2-november-2022/">major asset classes</a> showed a recovery during the trading week ending Friday, November 11, according to various ETF proxies. The only exception to this trend was a broad commodity measure.</p>

    <p> <a href="https://www.capitalspectator.com/real-estate-ex-us-led-ongoing-rebound-in-markets-last-week/#more-19113" 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/real-estate-ex-us-led-ongoing-rebound-in-markets-last-week/" title="6:57 am" rel="bookmark"><time class="entry-date" datetime="2022-11-14T06:57:52-05:00">November 14, 2022</time></a>
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    <p>* Democrats <a href="https://www.politico.com/news/2022/11/13/election-house-democrats-senate-republicans-00066643">retain</a> the Senate, while House control remains uncertain<br/>* Democrats announce plans to <a href="https://www.cnbc.com/2022/11/13/democratic-congressional-leaders-vow-to-address-us-debt-limit.html">address</a> the US debt ceiling in the coming weeks<br/>* Fed's Waller states, “We’ve still got a ways to go” before pausing rate hikes, according to <a href="https://www.bloomberg.com/news/articles/2022-11-13/fed-s-waller-says-there-s-a-ways-to-go-before-rate-hikes-done">his remarks</a><br/>* Biden <a href="https://www.cnbc.com/2022/11/14/biden-and-xi-meet-in-person-for-the-first-time.html">meets</a> President Xi, aiming to ‘manage our differences’<br/>* The collapse of FTX prompts a <a href="https://www.bloomberg.com/news/articles/2022-11-13/big-investors-are-giving-up-on-crypto-markets-going-mainstream?srnd=premium&amp;leadSource=uverify%20wall">reassessment</a> of cryptocurrency's role in asset allocation<br/>* Is a de-growth strategy the <a href="https://www.cnn.com/2022/11/13/economy/degrowth-climate-cop27/index.html">optimal approach</a> for addressing climate change?<br/>* The pandemic housing bubble is bursting, asserts the KPMG Chief Economist<br/>* Smaller farmers are being priced out of the market as farmland values reach <a href="https://www.nytimes.com/2022/11/13/us/politics/farmland-values-hit-record-highs-pricing-out-farmers.html">record highs</a><br/>* Eurozone industrial production showed <a href="https://think.ing.com/snaps/eurozone-industry-experienced-dead-cat-bounce-in-third-quarter">unexpected strength</a> in October<br/>* The US Dollar Index dropped to a three-month low on Friday:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2022/11/usd.14nov2022.png"><img decoding="async" class="alignnone size-full wp-image-19112" src="https://www.capitalspectator.com/wp-content/uploads/2022/11/usd.14nov2022.png" alt="" width="700" height="312"  /></a></p>
    <p> <a href="https://www.capitalspectator.com/macro-briefing-14-november-2022/#more-19109" 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-14-november-2022/" title="6:09 am" rel="bookmark"><time class="entry-date" datetime="2022-11-14T06:09:17-05:00">November 14, 2022</time></a>
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    <p><a href="https://www.amazon.com/Profit-History-Corporations-William-Magnuson/dp/1541601564?keywords=For+Profit%3A+A+History+of+Corporations&amp;qid=1667918925&amp;s=books&amp;sr=1-1&amp;linkCode=li2&amp;tag=thecapitalspe-20&amp;linkId=bdae6422c4975d2626a3f4301db28edc&amp;language=en_US&amp;ref_=as_li_ss_il" target="_blank" rel="noopener"><img decoding="async" class="alignleft" src="https://ws-na.amazon-adsystem.com/widgets/q?_encoding=UTF8&amp;ASIN=1541601564&amp;Format=_SL160_&amp;ID=AsinImage&amp;MarketPlace=US&amp;ServiceVersion=20070822&amp;WS=1&amp;tag=thecapitalspe-20&amp;language=en_US" border="0"/></a><img decoding="async" style="border: none !important; margin: 0px !important;" src="https://ir-na.amazon-adsystem.com/e/ir?t=thecapitalspe-20&amp;language=en_US&amp;l=li2&amp;o=1&amp;a=1541601564" alt="" width="1" height="1" border="0"/>● <a href="https://amzn.to/3FY0FgY">For Profit: A History of Corporations</a><br/>William Magnuson<br/><strong><a href="https://www.economist.com/culture/2022/11/10/for-profit-offers-thrilling-tales-of-commercial-endeavour">Review</a> via The Economist</strong><br/>Although William Magnuson's remarkable account of the history of corporations does not reference Elon Musk, spanning from the ancient Roman societas publicanorum to Renaissance Florence and the Age of Discovery, it sheds light on why Musk, a founder of electric vehicles and space exploration—now involved with Twitter—captures so much attention. For over two millennia, corporations like his have driven seminal achievements in human history. However, the most striking often overreach, leaving a legacy of destruction and skepticism in their wake.</p>
    <p> <a href="https://www.capitalspectator.com/book-bits-12-november-2022/#more-19080" 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-12-november-2022/" title="4:01 am" rel="bookmark"><time class="entry-date" datetime="2022-11-12T04:01:00-05:00">November 12, 2022</time></a>
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    <p>US consumer inflation <a href="https://stats.bls.gov/news.release/cpi.nr0.htm">decreased in October,</a> showing a milder-than-expected rise and sparking renewed hopes that inflationary pressures may have peaked. Even if this is the case, high inflation is likely to persist, and the Federal Reserve is poised to continue increasing interest rates, potentially at a more measured pace than previously anticipated. Following the latest report, there is renewed optimism regarding the possibility that the inflation spike has reached its zenith.</p>

    <p> <a href="https://www.capitalspectator.com/peak-inflation-watch-11-november-2022/#more-19103" 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/peak-inflation-watch-11-november-2022/" title="7:33 am" rel="bookmark"><time class="entry-date" datetime="2022-11-11T07:33:16-05:00">November 11, 2022</time></a>
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    <p>* Control of the US Senate <a href="https://www.reuters.com/world/us/control-us-congress-hangs-balance-with-key-contests-still-unresolved-2022-11-11/">remains uncertain</a> as the GOP edges closer to reclaiming the House<br/>* Russia <a href="https://apnews.com/article/russia-ukraine-putin-europe-moscow-government-and-politics-0c1bb4cf5a3fa4d2d05aa10ef2929d39?utm_source=homepage&amp;utm_medium=TopNews&amp;utm_campaign=position_01">withdraws</a> from a significant city in southern Ukraine<br/>* October's softer inflation report <a href="https://www.wsj.com/articles/inflation-report-leaves-fed-on-track-for-0-5-point-rate-rise-in-december-11668088481">still sets the Fed</a> for a 0.5-point rate increase<br/>* China <a href="">eases</a> Covid restrictions as new cases spike<br/>* US mortgage rates rebound <a href="https://www.cnn.com/2022/11/10/homes/mortgage-rates-november-10/index.html">above 7%<br/>* Another warning for the US housing market from the largest home builder<br/>* The UK economy <a href="https://www.nytimes.com/2022/11/10/business/economy/uk-economy-recession.html">contracted</a> by 0.2% in Q3, suggesting the onset of recession<br/>* US jobless claims <a href="https://www.wsj.com/articles/jobless-claims-ticked-up-but-remained-historically-low-11668088210">have ticked higher</a>, yet they remain near historic lows<br/>* US core inflation <a href="https://www.bloomberg.com/news/articles/2022-11-10/us-core-cpi-slows-more-than-forecast-gives-fed-downshift-room#xj4y7vzkg">decreased more than expected</a> in October:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2022/11/cpi.11nov2022.png"><img loading="lazy" decoding="async" class="alignnone size-full wp-image-19100" src="https://www.capitalspectator.com/wp-content/uploads/2022/11/cpi.11nov2022.png" alt="" width="1200" height="675"  /></a></p>
    <p> <a href="https://www.capitalspectator.com/macro-briefing-11-november-2022/#more-19099" 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-11-november-2022/" title="6:25 am" rel="bookmark"><time class="entry-date" datetime="2022-11-11T06:25:23-05:00">November 11, 2022</time></a>
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    <p>One prevalent criticism directed at the Federal Reserve is that the central bank acted too slowly last year, delaying its monetary policy tightening that could have curbed emerging inflation. Critics argue that an earlier shift to a more hawkish stance might have shielded the US from current inflation woes. However, examining other central banks that adopted similar strategies suggests otherwise.</p>

    <p> <a href="https://www.capitalspectator.com/can-the-fed-tame-inflation-or-is-it-different-this-time/#more-19096" 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/can-the-fed-tame-inflation-or-is-it-different-this-time/" title="7:33 am" rel="bookmark"><time class="entry-date" datetime="2022-11-10T07:33:43-05:00">November 10, 2022</time></a>
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    <p>* Hurricane Nicole has weakened into a tropical storm over east-central Florida<br/>* Peace talks regarding Ukraine <a href="https://www.nytimes.com/2022/11/09/us/politics/ukraine-russia-peace-talks.html">remain unlikely</a> as Russia <a href="https://www.nytimes.com/2022/11/09/world/europe/ukraine-russia-kherson-retreat.html">withdraws from a critical position</a><br/>* Binance <a href="https://www.cnbc.com/2022/11/09/binance-backs-out-of-ftx-rescue-leaving-the-crypto-exchange-on-the-brink-of-collapse.html">drops its plan</a> to rescue FTX, putting the crypto exchange in jeopardy<br/>* The US 3mo-10yr Treasury yield curve remains negative, returning to a 2.5-year low:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2022/11/yld.curve_.10nov2022.png"><img loading="lazy" decoding="async" class="alignnone size-full wp-image-19094" src="https://www.capitalspectator.com/wp-content/uploads/2022/11/yld.curve_.10nov2022.png" alt="" width="700" height="312"  /></a></p>
    <p><strong>The US debt ceiling is under scrutiny as Republicans appear poised to take control of the House.</strong> “If Republicans manage to secure the House while Democrats maintain the Senate, we foresee an assertive GOP advocating for spending cuts before agreeing to raise the debt ceiling,” <a href="https://www.bloomberg.com/news/articles/2022-11-10/republican-house-could-deepen-recession-over-debt-ceiling?srnd=premium">state</a> Anna Wong and Andrew Husby of Bloomberg Economics. “This brinkmanship could increase borrowing costs, potentially leading the economy from a brief and mild recession next year into something far more severe.”</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2022/11/debt.ceiling.10nov2022.png"><img loading="lazy" decoding="async" class="alignnone size-full wp-image-19095" src="https://www.capitalspectator.com/wp-content/uploads/2022/11/debt.ceiling.10nov2022.png" alt="" width="820" height="465"  /></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-10-november-2022/" title="6:29 am" rel="bookmark"><time class="entry-date" datetime="2022-11-10T06:29:49-05:00">November 10, 2022</time></a>
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    <p>The stock market's performance after the elections is now under scrutiny. From an equity-risk factor viewpoint, the competition commences with high dividend yield leading the year-to-date results, as evidenced by a range of ETFs through the close on Tuesday, November 8.</p>

    <p> <a href="https://www.capitalspectator.com/high-dividend-yield-still-leader-for-us-factor-returns-in-2022/#more-19087" 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/high-dividend-yield-still-leader-for-us-factor-returns-in-2022/" title="7:13 am" rel="bookmark"><time class="entry-date" datetime="2022-11-09T07:13:38-05:00">November 9, 2022</time></a>
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