Boom—Fed Opts for 50 On Wednesday, the Federal Reserve announced a 50-basis point (bp, 1 bp = 0.01%) rate cut for the fed funds rate to 4.75 – 5.00%, its first reduction since 2020. The announcement marks the end of…
A Green Light for the Fed—in Three Graphs All indications point to a rate cut by the Federal Reserve this week. What’s behind the Fed’s rationale? Let’s look at three key metrics. Aided by lower gasoline prices and stable prices…
Then and Now Overbuilding, speculation, and easy access to credit encouraged a housing boom and a bust in the 2000s. Sales cratered later in the decade, and along with it, prices tumbled. Today, housing sales have plummeted once again. According…
Powell’s Victory Lap Speech (sort of) Fed Chief Powell’s much-anticipated speech against the picturesque backdrop of the Grand Tetons in Jackson Hole, WY, virtually assures that the Fed will reduce interest rates next month. In a short 16-minute speech, Powell…
Economic Anxieties Subside Markets settled down in Japan, and the latest economic reports in the U.S. aren’t signaling that the economy is headed for an imminent recession. These factors sparked a strong rally in U.S. stocks last week. Led by…
A Rollercoaster and the Carry Trade Ask the average investor what inflation or unemployment is, and they can probably give you a good working definition. Ask them about the ‘carry trade,’ and you’ll likely get a blank stare. Even the…
A September Rate Cut is on the Table, Softer Economic Data Raises Worries As expected, the Federal Reserve kept its key rate, the fed funds rate, unchanged at 5.25 – 5.50%. After holding the fed funds rate steady for a…
Brisk Pace for GDP The U.S. Bureau of Economic Analysis reported that the Gross Domestic Product (GDP), the largest measure of goods and services, expanded at a brisk annualized pace of 2.8% in the second quarter. That’s up from 1.4%…
Two Graphs and a Data Table… …And they all come to the same conclusion. What’s going on? The labor market is moving back into balance. No longer do we come across articles touting the Great Resignation. In 2021 and 2022,…
Another Soft Inflation Number Bolsters the Case for Lower Rates In 2021 and 2022, soaring inflation sparked the most aggressive series of rate hikes in decades. While prices remain high, the rate of those price increases has slowed, and the…
