● Who Rules the World?
By Noam Chomsky
Summary via publisher (Metropolitan/Macmillan)
In a compelling and detailed examination of today’s international landscape, Noam Chomsky posits that the United States’ military-focused strategies, coupled with a relentless ambition to uphold a global empire, not only jeopardize global stability but also degrade shared resources worldwide. Utilizing varied examples—from the escalating drone strike operations to nuclear threats, as well as pivotal locations like Iraq, Iran, Afghanistan, and Israel/Palestine—he provides unexpected and insightful perspectives on imperial influence amidst escalating global chaos.
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The Atlanta Fed has revised its GDP growth forecast for the second quarter up to 2.8%, representing a significant improvement over the nearly stagnant 0.5% growth in Q1 (seasonally adjusted annual rate). This optimistic update is primarily driven by a notable recovery in retail sales in April following a dip in March.
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According to the US Census Bureau, consumer spending saw a resurgence in April following a decline in March. This update strengthens the argument that economic growth is poised to improve in the second quarter after stagnating in Q1, as indicated by GDP data.
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Although the US stock market exhibits some instability, the same cannot be said for utility stocks. This sector, sensitive to interest rates, continues to lead the performance race, according to various proxy ETFs.
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● US jobless claims reach a 14-month high; analysts attribute this to the Verizon strike | Reuters
● US Consumer Comfort Index falls to a 5-month low due to economic outlook | Bloomberg
● US import prices rise by 0.3% for the second consecutive month | MarketWatch
● Bank of England warns that a Brexit slowdown could lead to recession | Reuters
● Economic growth in Germany accelerates due to increased consumption | NY Times
● UN lowers global economic growth projection for 2016 | Reuters
● Confronting the unseen yet significant hyperinflation challenge | Scott Sumner (Econolog)
Anticipations are set high for a rebound in US retail sales in the upcoming April report, as projected by The Capital Spectator’s average point forecast across various econometric estimates. The aggregate prediction indicates a 0.6% increase compared to the previous month’s figures.
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A recent surge in new unemployment benefit filings in the US has caught analysts off guard, contradicting expectations for a slight decrease. Instead, economists were surprised as jobless claims rose by 20,000 to a seasonally adjusted total of 294,000 for the week ending May 7, according to the Labor Department reports. The government clarified that no “special factors” contributed to this release, marking the most considerable weekly increase in the seasonally adjusted data in two years. However, the data might be affected by a Verizon strike in New York, indicating that the disheartening report may not be as alarming upon closer inspection.
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An insightful essay by Cliff Asness of AQR Capital Management has sparked valuable discourse around the challenges of factor timing (“The Siren Song of Factor Timing”). He cautions investors to proceed with caution, as the general track record for successful market timing is overwhelmingly negative. Nonetheless, Asness makes clear that there are moments when the perceived benefits of attempting some timing are simply too attractive to overlook.
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● US mortgage applications rise a modest 0.4%, despite rates nearing 3-year lows | CNBC
● US budget deficit widened in April | WSJ
● The impending UK ‘Brexit’ vote is causing global unease | USA Today
● The Fed’s tight policies contributed to increased poverty | Narayana Kocherlakota (Bbg)
● Surge in gold fund purchases drives demand to its second-highest ever | Bloomberg
● A majority of Brazil’s Senate supports impeachment of Rousseff | Reuters
Portfolio design varies greatly, mirroring the diversity among investors. Balancing these differences is crucial in delivering sound financial guidance. However, some investors view tailoring strategies to align with individual goals, risk appetite, and other variables as treachery, insisting on a singular approach for all—believing anything else is deception. This limited perspective often surfaces in discussions surrounding buy-and-hold strategies, yet the argument against customization has wider implications.
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### Conclusion
In a rapidly changing economic environment, understanding current trends is essential. From retail sales rebounds to the implications of global economic policies, it is vital for investors and individuals alike to stay informed about market dynamics and economic indicators. By doing so, one can better navigate potential challenges and opportunities that lie ahead.
