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2022-09-06 22:39:22 IMF: Crypto Assets Become More Mainstream as Hedges Against Weak Currencies, Potential Payment Instruments

The International Monetary Fund (IMF) published a report stating that crypto assets have gained a “more mainstream presence as speculative investments, hedges against weak currencies, and potential payment instruments.” The IMF has called for a global response to crypto regulation that is coordinated, consistent, and comprehensive.

It’s only in the past few years that crypto assets have moved from being niche products in search of a purpose to having a more mainstream presence as speculative investments, hedges against weak currencies, and potential payment instruments.

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2022-09-05 23:44:30 Morgan Stanley says what will fuel another decline in stocks

Morgan Stanley’s been widely credited, at least among the major Wall Street banks, for correctly predicting the rough ride that stocks would endure this year.

“With the Fed emphatically dashing hopes for a dovish pivot, we think that asset markets may be entering fire and ice part deux. In contrast with part one, this time the decline in stocks will come mostly via a higher [equity risk premium] and lower earnings rather than higher rates,” says Morgan Stanley.

The equity risk premium is the return that investing in the stock market provides over a risk-free rate.

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2022-09-03 18:47:09 Breaking Down ETFs

The idea of pooling investment assets has been around for centuries. Mutual Funds first appeared in the 1920s. But it wasn’t until the 1980s that mutual funds became widely popular with mainstream investors. In recent years, ETFs have taken off as an alternative to mutual funds.

An exchange-traded fund (ETF) is a “basket” of stocks, bonds, or other financial instruments that gives convenient exposure to a diverse range of assets. ETFs are an incredibly versatile tool that can track anything from a particular index, sector, or region to an individual commodity, a specific investment strategy, currencies, interest rates, volatility, or even another fund. You can do about anything with them — hold a diversified portfolio, hedge, focus on a particular sector, or even profit in a bear market.

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2022-09-03 18:42:11 ‘The psychology has changed so quickly’: Why stock-market lows may be retested as S&P 500 enters its weakest stretch of year

With summer winding down, the U.S. stock market is set up for a potentially shaky fall.

“Recession fears are the most likely trigger of a retest of the June lows,” said Ed Clissold, chief U.S. strategist at Ned Davis Research, in an Aug. 31 note. “From a seasonality perspective, a retest could come in the next several weeks.”

When U.S. investors return from the long Labor-Day weekend, history indicates they’ll be facing the weakest time of the year for the S&P 500 index: the stretch from Sept. 6 to Oct. 25, according to the note.

“We believe it likely that the United States will struggle to regain above-trend growth in the quarters ahead,” Vanguard said. “We place the likelihood of a U.S. recession at about 25% in the next 12 months and 65% in the next 24 months.”

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2022-09-01 14:01:22 ‘Prepare for an epic finale’: Jeremy Grantham warns ‘tragedy’ looms as ‘superbubble’ may burst

A “superbubble” appears dangerously near its “final act” after the recent rally in U.S. stocks lured some investors back into the market just ahead of potential “tragedy,” according to Jeremy Grantham.

“One of those features is the bear-market rally after the initial derating stage of the decline but before the economy has clearly begun to deteriorate, as it always has when superbubbles burst,” said Grantham. “This, in all three previous cases, recovered over half the market’s initial losses, luring unwary investors back just in time for the market to turn down again, only more viciously, and the economy to weaken. This summer’s rally has so far perfectly fit the pattern.”

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2022-09-01 13:58:32 Eurozone Inflation Taps Highest Rate Ever Recorded Reaching 9.1%, as Nord Stream Halt Gas Supplies

The Eurozone’s inflation rate reached a record high in August of 9.1%, the highest ever recorded in history, according to Europe’s statistics office Eurostat. The rate was higher than economists suspected and most of the rise was fueled by Europe’s rising energy prices.

Currently, Europe is suffering from the highest inflation rate the euro area has seen in almost 50 years, and each one of the members of the monetary union has seen red-hot consumer prices.

Statistics show that energy prices had the largest inflation rise reaching 38.3% and items like food jumped 10.6%. Furthermore, non-energy industrial goods rose by 5% compared to the value of these goods measured last year.

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2022-08-30 20:30:58 IMF Expects US Economy to Experience High Inflation for at Least Another Year or Two

The International Monetary Fund (IMF) expects the U.S. economy to experience high inflation for at least another year or two. “I would be careful about looking at one data point for the U.S.,” IMF First Deputy Managing Director Gita Gopinath cautioned.

There are global factors like energy prices and food prices that are driving it but there are also kind of more sticky components of inflation that are high.

We are in a period where inflation is likely to be high for a while, at least for another year or two.

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2022-08-30 20:29:23 Goldman Sachs Urges Investors to Buy Commodities Now — Expects Equities to Suffer as Inflation Stays Elevated

Global investment bank Goldman Sachs has urged investors to buy commodities now and worry about a recession later. The firm’s analysts see commodities as “the best asset class to own during a late-cycle phase where demand remains above supply.” Meanwhile, “equities could suffer as inflation stays elevated and the Fed is more likely to surprise on the hawkish side,” Goldman noted.

With oil the commodity of last resort in an era of severe energy shortages, we believe the pullback in the entire oil complex provides an attractive entry point for long-only investments.

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2022-08-30 20:27:59 Senator Warren 'Very Worried' About Federal Reserve Raising Interest Rates, Tipping US Economy Into Recession

U.S. Senator Elizabeth Warren says she is “very worried” that the Federal Reserve will tip the economy into recession. “There is nothing in raising the interest rates, nothing in Jerome Powell’s tool bag that deals directly with” the causes of inflation, she explained.

There is nothing in raising the interest rates, nothing in Jerome Powell’s tool bag that deals directly with those, and he has admitted as much in congressional hearings when I’ve asked him about it.

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2022-08-30 20:26:40 Consumer Confidence Jumps in August as Inflation Slows

The U.S. Consumer Confidence Index increased to 103.2 in August, following three straight months of declines, according to the Conference Board’s U.S. Consumer Confidence Survey. Economists surveyed by FactSet were expecting the index to jump to 97.4, up from July’s revised 95.3 reading. The index is measured on a scale of 140.. The index is measured on a scale of 140.

The increase comes as inflation showed signs of abating, with both major inflation indices registering a deceleration in July. The consumer-price index dipped to an 8.5% annual pace, down from the previous month’s 9.1% pace, while the core personal consumption expenditures index was up 4.7%.

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