● US mortgage applications decline as interest rates rise | CNBC
● ECB President Draghi suggests further stimulus measures next month | Reuters
● Eurozone industrial production dips again in September compared to August | Reuters
● German inflation shows a slight increase in October | MarketWatch
● French consumer inflation rises slightly in October | MNI
● Loan growth in China hits a 15-month low in October | Bloomberg
The US stock market has experienced significant fluctuations over the past three months. If you were to overlook the volatility that began on August 18 and instead focus on the S&P 500 as of its closing value on November 10, you might conclude that not much has changed. The minor loss appears quite uneventful, leading one to question the drama surrounding it. Significant churn occurred in the market since mid-August, but currently, the situation seems stable, with the S&P 500 returning to its starting point.
Continue reading
● US import prices fell by 0.5% in October, marking the fourth consecutive decline | MarketWatch
● US small business optimism index remained unchanged in October | Reuters
● Redbook reports an increase in US retail sales during the first week of November | WSJ
● China’s industrial production growth hit a six-month low in October | Telegraph
● Retail spending in China edged up to an annual growth rate of 11% in October | IBT
● The UK jobless rate dropped to an eight-year low for the three months ending in September | BBC
The risk of a recession in the US continues to diminish after being moderately elevated in recent months. Various business-cycle indicators have suggested potential issues without fully confirming them. The primary concern was associated with increased market volatility; however, economic data has only shown minor fluctuations without significant declines. This highlights the importance of using a comprehensive methodology to monitor and assess the business cycle, ensuring that one can distinguish genuine economic signals from mere market noise.
Continue reading
● US Labor Market Conditions Index has risen to a three-month high in October | EconoTimes
● The Conference Board’s Employment Trend Index indicates “solid job growth” in October | CB
● Moody’s continues to expect sluggish growth for G20 countries | EconoTimes
● The International Energy Agency predicts oil prices will rise to $80 per barrel by 2020 | WSJ
● Low inflation persists in China | Reuters
● French industrial output exceeded expectations in September | Bloomberg
● Industrial production in Italy increased, though less than anticipated, in September | RTT
● Japan’s Eco Watchers Sentiment Index rose in October, the first increase in three months | MNI
Emerging market equities outperformed other asset classes last week, posting the highest gains among available proxy ETFs. Vanguard Emerging Markets (VWO) surged 1.6% for the week ending November 6, surpassing US equities represented by Vanguard Total US Stock Market (VTI), which rose 1.2%.
Continue reading
● US job growth saw a significant increase in October | Fortune
● A Federal Reserve official suggests that a rate hike “makes sense” | Reuters
● Will a strong dollar decrease the chances of a US rate hike? | Bloomberg
● US consumer credit rose more than expected in September | RTT
● China’s trade data for October was disappointing | Reuters
● German exports increased more than forecast in September | MarketWatch
● Why Minsky Matters: An Introduction to the Work of a Maverick Economist
By L. Randall Wray
Summary via publisher (Princeton University Press)
Hyman P. Minsky (1919–96) is renowned for his prescient warnings regarding financial instability, which were validated by the global financial crisis. While some economists signaled alarms as early as 2000, Minsky’s crucial insights about economic vulnerabilities originated decades earlier. Despite his significance, he largely remains outside the mainstream economics discourse, with few people fully grasping or appreciating his works. “Why Minsky Matters” seeks to make his vital insights accessible to general readers for the first time. L. Randall Wray illustrates how understanding Minsky could help us recognize and potentially avert future economic crises.
Continue reading
In October, US private-sector employment experienced a significant surge, according to a report from the Labor Department reports. The 268,000 increase, which was larger than expected, represents the most substantial monthly rise thus far in 2015, recovering from the sluggish growth seen in the previous months. This noteworthy gain may signal a positive shift in the annual growth rate since May. However, whether this optimistic trend will hold in upcoming revisions remains to be seen. For now, the report provides the Federal Reserve with a clear indicator to consider raising interest rates.
Continue reading
Recently, some voices in the media have suggested that allowing bankrupt banks to fail could be a suitable policy approach during economic turmoil. This notion may seem appealing as it presents a dramatic and logical stance, making for engaging television discussions. However, the reality is that banks play a unique role in the economy and must be treated differently from other failing entities. There is a wealth of historical evidence supporting the idea that allowing banks to collapse can lead to disastrous consequences. While some may overlook important lessons from history, the past consistently reminds us of the ramifications of ignoring the unique nature of banks in times of crisis.
Continue reading
In summary, the recent economic data reflects a mix of challenges and promising signs across various sectors. Mortgage applications are declining, while employment in the private sector is witnessing notable growth. As policymakers navigate these conditions, the emphasis on robust analysis and forecasting will be vital for informed decision-making in the dynamic landscape of global finance.
