The rollout of President Trump’s tariffs on Canada, Mexico and China has roiled expectations for US economic activity in the first quarter.
Macro Briefing: 05 March 2025
US stock market post-election gain evaporates amid concerns about negative economic effects from President Trump’s trade war. After yesterday’s drop in the S&P 500, equities are 2.5% below the Nov. 6, 2024 close, the first trading day following the election. Addressing Congress Tuesday night, Trump reaffirmed his committment to tariffs, admitting there will be “a little disturbance” and that there “may be a little bit of an adjustment period. You have to bear with me again and this will be even better,” he claimed.
Total Return Forecasts: Major Asset Classes | 04 March 2025
The long-run expected total return for the Global Market Index (GMI) fell in February, sliding to an annualized 7.1% vs. the previous month’s 7.4%. The downward revised forecast follows several months of higher estimates. The analysis is based on three models (defined below) for GMI, a global benchmark built with the major asset classes (excluding cash).
Macro Briefing: 04 March 2025
Major Asset Classes | February 2025 | Performance Review
Most of the major asset classes rallied in February, based on a set of ETFs. The downside exceptions: US stocks and a broad measure of commodities. Otherwise, global markets posted were broadly higher last month.
Macro Briefing: 03 March 2025
Inflation slowed in January, according to Personal Consumption Expenditures, the Federal Reserve’s preferred measure of inflation. Prices rose 2.5% for the year through January, down slightly from 2.6% in December, marking the first decrease in four months. Prices “rose at a mild pace in January, which offers some relief after a string of economic reports suggesting that inflation is heating up again,” writes Key Wealth managing director of fixed income investments Rajeev Sharma.
Book Bits: 1 March 2025
● Chokepoints: American Power in the Age of Economic Warfare
Edward Fishman
Review via The Wall Street Journal
In “Chokepoints: American Power in the Age of Economic Warfare,” Edward Fishman makes clear why this banker so badly underestimated America’s financial power. Deftly written, “Chokepoints” is a compelling and dramatic narrative about the new shape of geopolitics—one in which the U.S. mobilizes its economic and financial pre-eminence for geopolitical objectives, especially in its clashes with China, Iran and Russia. It’s the story of a world economy that has moved from confident globalization to increasing fragmentation and in which economic warfare has become “a baseline feature of our world.”
Economic Slowdown Concerns Top Inflation Worries For Bonds
Sticky inflation risk is still a threat for the bond market, but concern that the US economy is slowing has become the main factor driving Treasury yields lower recently.
Macro Briefing: 28 February 2025
US jobless claims rose more than expected last week, rising to highest level since December. Although the rise leaves claims far below a level that suggests elevated recession risk, some economists see the increase as a sign that the labor market is slowing.
US Sector Leadership Shifts, Favoring Healthcare Stocks
As markets try to look through the blizzard of policy changes flowing out of Washington, the crowd has shifted its preferences considerably in recent weeks based on a sector lens. Using a set of ETFs as proxies, healthcare is now the leading sector performer year to date, taking the lead from financials, based on prices through Wednesday’s close (Feb. 26).