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Stock Markets and the Economy

Found 230 Articles.
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Investors Are Anticipating Goldilocks’ Arrival

February 20, 2023

The markets are ignoring one of the prime investment rules: Don’t fight the Fed. Federal Reserve officials say they will have to maintain tight monetary policy considerably longer to bring inflation to the 2% target, even after the historically aggressive rate increases of 2022. Markets seem to disagree, while anticipating what some call a soft […]

How Long Will Labor Market, Corporate Earnings Hold Up?

January 20, 2023

In the next few months, we’ll learn how well household spending and corporate earnings hold up following the most aggressive monetary tightening in 50 years. The Federal Reserve had to tighten monetary policy more in 2022 than it and most investors expected. Higher household wealth and a very tight labor market fueled consumer spending and […]

The Fed Has More Work to Do

December 27, 2022

What will the Federal Reserve do when infla- tion drops to between 4% and 5%? That’s the key question for the first half of 2023. In 2022, the Fed tightened monetary policy faster than any time since at least 1980. It will tighten more in early 2023, but at a little slower pace than in […]

The Fed Isn’t Finished

December 7, 2022

Inflation probably peaked for this cycle, but the Federal Reserve still has a lot of work to do. Investors already fooled themselves a couple of times in 2022 by concluding prematurely that the Fed was done tightening monetary policy and soon would adopt a looser one. Investors became enthusiastic again in November after the Consum- […]

The Fed Continues to Tighten, and Markets Stagger

November 1, 2022

Do you believe Federal Reserve officials will do what they say? If you do, expect interest rates to rise higher and economic growth to continue declining. Fed officials say they’re determined to restore their anti-inflation credibility and bring the 12-month inflation rate much closer to their 2% to 2.5% target. The Fed leaders admit accomplishing […]

10 Questions I’m Asked the Most Now About Income, Safety and Annuities

October 14, 2022

Income and safety are the top priorities for many investors now. It is no wonder. Stocks and bonds are way down, and the losses aren’t likely to end soon. The Baby Boomers continue to age and are more interested in income and cash flow than growth. There’s a rise in uncertainty about the economy, markets […]

The Fed vs. Inflation: The Battle Continues

September 29, 2022

Stagflation is the economic environment that’s most damaging to financial assets. The combination of a weak economy and high inflation hurts both stocks and bonds. We’re likely entering a period of stagflation. The economy is slowing because of the Fed’s actions. The housing market probably has declined more than any other sector. Prices for many […]

Markets Are Betting That Inflation Is Collapsing

August 31, 2022

In the July issue, I asked, “Which will break first: inflation, the economy, or the Federal Reserve?” Futures market prices indicate, as they have all year, that investors expect inflation to fall to the Fed’s target after modest interest rate increases and without triggering a recession or reduction in earnings growth. The July Consumer Price […]

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