Strategic Global Intelligence Brief for April 1, 2019

Short Items of Interest—U.S. EconomyIt Is Not Time—Even Doves AgreeNeel Kashkari has been one of the most vocal of the regional Fed presidents on the subject of rates. He has been consistently dovish and has opposed all of the rate cuts that have taken place thus far despite eventually going along with some of the decisions. He is not a voting memb...
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Strategic Global Intelligence Brief for March 29, 2019

Short Items of Interest—U.S. EconomyEconomic Slowdown Was Corporate Slowdown The latest data coming from the investment community shows that much of the problem with economic growth at the end of 2018 can be attributed to a radical slowdown in the rate of corporate profits. This slowdown was masked to some degree by the surging stock market as it w...
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Strategic Global Intelligence Brief for March 28, 2019

Short Items of Interest—U.S. EconomyFed Pushback on Yield Curve Debate As with most assertions regarding economic cause and effect, there are flaws in the logic. The belief is that an inverted yield curve is the precursor to a recession. While that has been true, there has always been a lot of variance. That recession may take two or three years to...
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Strategic Global Intelligence Brief for March 25, 2019

Short Items of Interest—U.S. EconomyInverted Yield Curve Arrives—Time to Panic? When there is an inverted yield curve, there is a school of thought that assumes a recession is imminent—after all the last seven recessions have featured just such an inverted curve. This is when the 10-year bond yield falls below that of the three-year bond. The inver...
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Strategic Global Intelligence Brief for March 22, 2019

Short Items of Interest—U.S. EconomyEmployment Data Remains Strong By almost any measure, the job market has been staying strong. There was another week of reduced jobless claims, which tends to offset the fears regarding the slower than expected job growth reported last week. The job market is still better defined by the shortages that persist tha...
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Strategic Global Intelligence Brief for March 20, 2019

Short Items of Interest—U.S. EconomyJobs and Housing The labor shortage crisis shows no signs of abating. By most accounts, it will worsen in the future as more and more of the Boomer generation retire and stay retired. There are many reasons employers have been unable to find the people they need—lack of skilled people in the hiring pipeline has b...
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Strategic Global Intelligence Brief for March 18, 2019

Short Items of Interest—U.S. EconomyManufacturing Decline The slowdown in the manufacturing sector has extended to two months according to the data released by the Fed. The level of output at U.S. factories fell by another 0.4%. That is on top of the decline from the month before. This is hardly a crash, but it means that most of the manufacturing ...
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Strategic Global Intelligence Brief for March 15, 2019

Short Items of Interest—U.S. EconomyHousing Sector Off to Weak Start The expectation for this year was not especially high given all the accumulated issues affecting the housing sector, but the latest data in new home starts has been weaker than expected. The decline was 6.9%, when the majority thought there would be a small increase. In January, t...
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Strategic Global Intelligence Brief for March 13, 2019

Short Items of Interest—U.S. EconomyInflation Threat Remains Tepid Economists have been accused of being more than a little like Cassandra with their repeated warnings of events that nobody chooses to believe until they come to pass. Inflation has been on the minds of analysts for several years now as the ingredients seem to have been in place for ...
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Strategic Global Intelligence Brief for March 12, 2019

Short Items of Interest—U.S. EconomyRetail Data Has Been RockyThe expectation was that retail sales would be flat at the start of the year. This was based on the fact that sales were off at the end of last year. The initial report from December of 2018 has shown a decline of 1.2%, but the revisions to that data showed a further decline of 1.6%. Thi...
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Strategic Global Intelligence Brief for March 8, 2019

Short Items of Interest—U.S. EconomyInternal Retraining Critics once assailed the majority of corporations for their policy of firing a group of employees and turning around and hiring new ones. The reaction by the managers was simple enough—they needed the skills of the new employees and no longer had a place for the old skills. Then, there was th...
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Strategic Global Intelligence Brief for March 6, 2019

Short Items of Interest—U.S. EconomyWill a Deal With China Mean Much in Short Term? It looks more and more likely that a deal of some kind will be struck between the U.S. and China over trade and tariffs, but the solution does not appear to be a definitive one—one that will have an impact on the global economy. If a deal is brokered, there will be ...
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Strategic Global Intelligence Brief for March 5, 2019

Short Items of Interest—U.S. EconomyDecline Noted in PMI The latest data from the Purchasing Managers' Index (PMI) shows another month of decline. There is not yet a sense of crisis as the numbers are still well into the expansion category (over 50), but the highs that were reached only a few months ago now seem a distant memory. Last month, the re...
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Strategic Global Intelligence Brief for March 1, 2019

Short Items of Interest—U.S. EconomyFourth Quarter GDP at 2.6%This was almost exactly what the majority of analysts expected. It is a return to the pace that has dominated the economy for the last 20 years; it's certainly a respectable number. The over 3% growth that was notched in the early part of 2018 was somewhat artificial as it owed much of i...
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Strategic Global Intelligence Brief for February 27, 2019

Short Items of Interest—U.S. EconomyMore Sliding in the Housing Market Housing starts were down by 11.2%, the steepest drop in two years. The majority of the data on housing has been pointing in this direction; however at this stage, it is not coming as any great shock. The price of homes had started to fall in 2018, but that was mostly within the ...
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Strategic Global Intelligence Brief for February 25, 2019

Short Items of Interest—U.S. EconomyUnemployment Is Low but So Are Wages This is not supposed to happen—at least not according to the rules of economics. The Phillips Curve states that when the rate of joblessness is low, the average wage will rise, which makes a certain amount of sense. The assumption is that business will get into a bidding war o...
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Strategic Global Intelligence Brief for February 22, 2019

Short Items of Interest—U.S. EconomySupport for Higher Interest Rates The consensus view at the moment holds there is no reason at all for the Fed to even consider hiking interest rates. That has been the admonition from Trump for several months. Now, the markets have joined in with all their doom and gloom assessments of growth in 2019. Lately, th...
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Strategic Global Intelligence Brief for February 20, 2019

Short Items of Interest—U.S. EconomyHawks Are Not Giving Up The emerging consensus view of the Fed—it is not going to hike rates again this year. We will find out a bit more about their thinking as we peruse the Fed minutes, but the commentary from most of the members has been pretty dovish. The sense is the economy has slowed enough to create conc...
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Strategic Global Intelligence Brief for February 19, 2019

Short Items of Interest—U.S. EconomyIs Debt Really a Problem? As with most things economic, the answer to this depends to a degree on one's perspective. The fact is that the U.S. national debt is larger than it has ever been. The Congressional Budget Office (CBO) predicts it will be 93% of GDP within a decade with annual deficits well over a trilli...
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Strategic Global Intelligence Brief for February 15, 2019

Short Items of Interest—U.S. EconomyWasn't Such a Happy Holiday After All It seems that retailers had a far less exciting December than they realized at first. The gangbuster consumer spending that marked November fizzled fast in December—even the usual late season rush by clueless male shoppers was not enough. The retailers had the slowest Decembe...
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