Bank Failures Shine Light On Interest Rate Risks
“We want to make sure that the troubles that exist at one bank don’t create contagion to others that are sound.” — Treasury Secretary Janet YellenSource: The Wall Street Journal, March 12, 2023 Financial markets reacted turbulently to the collapse of Silicon Valley Bank (SVB) on March 10, 2023, followed two days later by the […]
The Fed Pivots to Fight Inflation
On December 15, 2021, the Federal Open Market Committee (FOMC) of the Federal Reserve System made a significant shift in monetary policy in response to rising inflation. The Committee accelerated the reduction of its bond-buying program in order to tighten the money supply and projected three increases in the benchmark federal funds rate in 2022, […]
High-Frequency Indicators: Where to Look for Signs of Recovery
Technology companies rolled out tools to help public health officials and policymakers around the world monitor mobility trends with data collected from smartphone apps. Since the pandemic began, disruptions in business activity have varied greatly from region to region, and often from one week to the next, according to the severity of local COVID-19 outbreaks. […]
Reopening The Economy
This commentary touches on the following subjects.: Reopening the Economy C19 Infections, Hospitalizations, Deaths Vaccine Development Monetary Policy and Fiscal Stimulus The Bifurcated Stock Market It has been 84 days since the U.S. stock market started the C19 market sell-off. During that time a great deal of new information has come forth to help us […]
REPO Market Update
Back in September the market received a warning from the REPO market where interest rates unexpectedly spiked higher. Before describing what may be interfering with REPO market operations, I want to point out that signals from the bond market, while important, generally represent a time horizon of a year or more. Unlike other technical, fundamental, […]
Collateral Damage
I have become aware of new information about what may be preventing the REPO market from operating properly. Despite emergency Fed intervention, the REPO market continues to have trouble meeting cash demands. It may not be a liquidity problem after all, it appears to be a problem with collateral. The following example from Fed Governor […]
Dightman Capital – Q4 Outlook
U.S. stocks have experienced a strong recovery in 2019 but the increase in volatility the last several months is a concern. If stock indexes can hold current gains, they will deliver solid double-digit returns for the year despite sputtering trade progress with China and political turmoil in Washington DC. While political developments can lead to […]
A Divided Market
There are clearly opposite views on the market right now. After a fabulous day for all three indexes yesterday, not to mention the performance of many leading stocks, some commentators remain committed to the idea we are headed for a recession. A week ago, recession fears were plastered on the front pages of all the […]
Q2 2019 Market & Economic Review
Volatility returned to the U.S. stock market during the second quarter of 2019. By the end of May, broad U.S. stock indexes were below levels from the start of April. The S&P 500 actually traded below its 200 day moving average before a rally kicked off in June which ultimately delivered gains for the quarter. […]
Q1 2019 Market & Economic Review
U.S. stocks experienced a strong rally in the first quarter of 2019. The biggest performance driver came from the Federal Reserve pausing their interest hikes. Between 2017 and 2018 the Fed raised the Fed Funds rate approximately 8 times and until recently expected to continue raising rates into 2019. The sell-off in Q4 was largely […]
