Yesterday, the Federal Reserve took a more aggressive stance on inflation, signaling plans for multiple rate hikes in 2022. This decision appears largely influenced by the ongoing acceleration of inflation rates.
<p> <a href="https://www.capitalspectator.com/still-waiting-for-inflation-to-peak/#more-17191" 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/still-waiting-for-inflation-to-peak/" title="7:40 am" rel="bookmark"><time class="entry-date" datetime="2021-12-16T07:40:54-05:00">December 16, 2021</time></a>
</footer><!-- .entry-meta -->* The Fed indicates multiple rate hikes in 2022 to combat inflation.
* A study reveals Omicron variant spreads significantly faster but with milder symptoms.
* Leaders from China and Russia present a unified stance in response to increasing tensions with the US.
* Eurozone growth reaches a 9-month low in December, as per data from PMI surveys.
* The Omicron variant impacts UK growth in December, according to PMI data.
* US homebuilder confidence remains strong in December.
* Business activity continues to expand “robustly” in December, as indicated by the NY Fed Manufacturing Index.
* US retail sales slowed in November, growing at a pace below expectations:
<p><a href="https://www.capitalspectator.com/wp-content/uploads/2021/12/retail.16dec2021.png"><img fetchpriority="high" decoding="async" class="alignnone size-full wp-image-17190" src="https://www.capitalspectator.com/wp-content/uploads/2021/12/retail.16dec2021.png" alt="" width="647" height="401" /></a></p>
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By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-16-december-2021/" title="6:17 am" rel="bookmark"><time class="entry-date" datetime="2021-12-16T06:17:47-05:00">December 16, 2021</time></a>
</footer><!-- .entry-meta -->As the Federal Reserve prepares to discuss its current monetary policy stance, interest rates are a central focus. The critical question remains: will the central bank provide insights regarding plans for interest-rate hikes to address the recent inflation surge?
<p> <a href="https://www.capitalspectator.com/desperately-seeking-yield-15-december-2021/#more-17187" 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/desperately-seeking-yield-15-december-2021/" title="7:40 am" rel="bookmark"><time class="entry-date" datetime="2021-12-15T07:40:30-05:00">December 15, 2021</time></a>
</footer><!-- .entry-meta -->* The Federal Reserve is anticipated to signal a rate hike in today’s announcement.
* Investments in US inflation-protected Treasuries surged throughout 2021.
* China’s economic activity declined in November.
* Germany teeters on the brink of recession due to the impact of the virus.
* UK inflation has reached a 10-year high in November.
* US producer prices accelerated in November, reaching record highs.
* Congress approved an increase to the US debt ceiling.
* Small business optimism in the US rose slightly in November.
* US financial stress remains below average but is rapidly increasing:
<p><a href="https://www.capitalspectator.com/wp-content/uploads/2021/12/stress.14dec2021.png"><img decoding="async" class="alignnone size-full wp-image-17185" src="https://www.capitalspectator.com/wp-content/uploads/2021/12/stress.14dec2021.png" alt="" width="650" height="450" /></a></p>
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By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-15-december-2021/" title="6:00 am" rel="bookmark"><time class="entry-date" datetime="2021-12-15T06:00:05-05:00">December 15, 2021</time></a>
</footer><!-- .entry-meta -->The recent increase in the 10-year US Treasury yield has come to a halt. It remains uncertain whether this pause is temporary before a return to upward movement or the beginning of a new downward trend. The significant inflation rise this year combined with the possibility of an economic slowdown in the upcoming year presents conflicting signals that obscure the outlook. As this uncertainty continues, our baseline forecast suggests that the 10-year rate will remain within a specific trading range for the immediate future, partly informed by today’s update of The Capital Spectator’s ensemble model used to estimate the “fair value” of the benchmark yield.
<p> <a href="https://www.capitalspectator.com/10-year-treasury-yield-fair-value-estimate-14-december-2021/#more-17176" 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/10-year-treasury-yield-fair-value-estimate-14-december-2021/" title="7:31 am" rel="bookmark"><time class="entry-date" datetime="2021-12-14T07:31:54-05:00">December 14, 2021</time></a>
</footer><!-- .entry-meta -->* California reintroduces a mandatory indoor mask mandate regardless of vaccination status.
* The two-dose Pfizer vaccine reportedly offers 70% protection against hospitalization from Omicron.
* The US Secretary of State advises China to cease ‘aggressive actions’ in the Asia-Pacific.
* A second case of the Omicron variant is detected in China.
* US small business sentiment increased in November, yet remains significantly below previous highs.
* Wall Street is beginning to identify opportunities in China’s struggling stock market.
* Apple is on the verge of becoming the world’s first company with a $3 trillion market cap.
* The US 10-year Treasury yield decreased to 1.42%—the second lowest level in over two months:
<p><a href="https://www.capitalspectator.com/wp-content/uploads/2021/12/ten.yr_.14dec2021.png"><img decoding="async" class="alignnone size-full wp-image-17175" src="https://www.capitalspectator.com/wp-content/uploads/2021/12/ten.yr_.14dec2021.png" alt="" width="700" height="312" /></a></p>
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By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-14-december-2021/" title="6:30 am" rel="bookmark"><time class="entry-date" datetime="2021-12-14T06:30:11-05:00">December 14, 2021</time></a>
</footer><!-- .entry-meta -->Last week, a risk-on sentiment permeated global markets, propelled by a recovery in US shares, as evidenced by a variety of ETFs representing the major asset classes up to Friday’s close (December 10).
<p> <a href="https://www.capitalspectator.com/risk-assets-rallied-last-week/#more-17169" 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/risk-assets-rallied-last-week/" title="7:25 am" rel="bookmark"><time class="entry-date" datetime="2021-12-13T07:25:48-05:00">December 13, 2021</time></a>
</footer><!-- .entry-meta -->* G-7 countries caution Russia about potential ‘massive consequences’ should it invade Ukraine.
* US real interest rates have moved deeper into negative territory due to rising inflation.
* Could the extensive US borrowing from 2020 create challenges for the Federal Reserve in its fight against inflation?
* Share buybacks among S&P 500 companies have reached a record high for 2020.
* The flattening yield curve suggests that the economy has a low tolerance for rate hikes.
* The US 10-year minus 2-year Treasury yield curve is approaching a 12-month low ahead of the Fed meeting:
<p><a href="https://www.capitalspectator.com/wp-content/uploads/2021/12/yld.curve_.13dec2021.png"><img loading="lazy" decoding="async" class="alignnone size-full wp-image-17168" src="https://www.capitalspectator.com/wp-content/uploads/2021/12/yld.curve_.13dec2021.png" alt="" width="700" height="312" /></a></p>
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By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-13-december-2021/" title="6:06 am" rel="bookmark"><time class="entry-date" datetime="2021-12-13T06:06:38-05:00">December 13, 2021</time></a>
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Tony Davidow
Summary via publisher (McGraw-Hill)
The wealth management industry has experienced significant transformation over the past decade. This includes increased skepticism from investors, the rise of robo-advisors, the evolution of products, and an altering value proposition, not to mention geopolitical risks, rising correlations across asset classes, demographic shifts, and social tensions. Traditional concepts like “Modern Portfolio Theory” are no longer innovative, and even Post-Modern Portfolio Theory has fallen out of favor. Investment products have advanced dramatically in the last two decades, simplifying access for advisors and investors to various market segments and unique asset classes. Goals-Based Investing explores product evolution and illustrates how to effectively leverage these tools to achieve investment goals.
<p> <a href="https://www.capitalspectator.com/book-bits-11-december-2021/#more-17135" 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-11-december-2021/" title="5:00 am" rel="bookmark"><time class="entry-date" datetime="2021-12-11T05:00:00-05:00">December 11, 2021</time></a>
</footer><!-- .entry-meta -->How is your strategy in US equities performing this year? If you’ve been able to outperform the market, it’s likely due to your exposure to sectors such as energy, real estate, financials, or technology, or possibly a combination of these sectors.
<p> <a href="https://www.capitalspectator.com/energy-property-financials-tech-lead-us-sector-returns-in-2021/#more-17160" 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/energy-property-financials-tech-lead-us-sector-returns-in-2021/" title="7:11 am" rel="bookmark"><time class="entry-date" datetime="2021-12-10T07:11:04-05:00">December 10, 2021</time></a>
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