The answer depends on how you define “safe.” That’s a long conversation because every investor has a unique risk tolerance, time horizon and investment objective. What appears “safe” to you could frighten the hell out of your neighbor. Despite the caveats, we can at least start to think about how the odds stack up when the market takes a dive by crunching some numbers.
Monthly Archives: June 2022
Macro Briefing: 30 June 2022
* Putin says Russia will respond in kind to Nato expansion
* US economy shrank slightly more than previously estimated
* Fed Chair Powell reaffirms plans to combat inflation
* China mfg sector expands in June–first increase since Feb via PMI survey data
* US considers releasing more oil from the nation’s Strategic Petroleum Reserves
* Grayscale sues SEC over its rejection of firm’s bitcoin ETF
* US stock market still appears to be in bear market as Q2 winds down:
How Long Will Interest Rates Rise?
No one knows, of course, but history can offer some perspective for what’s possible and so it’s useful to compare the current regime shift with previous runs of tighter policy.
Macro Briefing: 29 June 2022
* Finland and Sweden set to join Nato after Turkey drops veto
* US home price gains eased in April but still rising at an annual 20%-plus pace
* Cleveland Fed’s Mester still backs another 75-basis-points rate hike in July
* Europe faces rising inflation and economic slowdown, says ECB economist
* Richmond Fed mfg index contracted again in June
* US Consumer Confidence Index falls to lowest since Feb. 2021:
Energy Stocks Are Down, But Remain Top Sector Performer
High-flying energy shares have hit turbulence in recent weeks but remain, by far, the leading performer for US equity sectors so far in 2022, as of yesterday’s close (June 27), based on a set of ETFs. But with global growth slowing, and recession risk rising, analysts are debating if it’s time to cut and run.
Macro Briefing: 28 June 2022
* China in focus at wrap-up for G-7 meeting
* Larry Summers’ inflation warning was right. Now he sees secular stagnation
* Lagarde says ECB is ready to “move faster” on rate hikes if needed
* Strong dollar is especially worrisome for emerging markets this time
* US durable goods rose more than forecast in May:
Global Markets Rebounded Last Week, Led By US REITs
A relief rally lifted most markets around the globe for the trading week through Friday, June 24, based on a set of ETF proxies. The question is whether the recovery is sustainable or just a bounce within an ongoing bear market for risk assets?
Macro Briefing: 27 June 2022
* G-7 leaders reaffirm their commitment to Ukraine and…
* Plan new sanctions on Russia including ban on Russian gold imports
* US economy will slow in 2022-23 but “narrowly avoid recession,” IMF predicts
* Russia defaults on its foreign debt for first time since 1918
* Central banks should act decisively to tame inflation, BIS advises
* Prominent crypto hedge fund at risk of default to repay $670 million
* Industrial metals prices set for the worst quarter since 2008 financial crisis
* Revised US consumer sentiment data confirms sharpe slide in June
* New US home sales rose in May — first monthly gain this year:
Book Bits: 25 June 2022
David Roediger
Summary via publisher (Haymarket Books)
The Sinking Middle Class challenges the “save the middle class” rhetoric that dominates our political imagination. The slogan misleads us regarding class, nation, and race. Talk of middle class salvation reinforces myths holding that the US is a providentially middle class nation. Implicitly white, the middle class becomes viewed as unheard amidst supposed concerns for racial justice and for the poor. Roediger shows how little the US has been a middle class nation. The term seldom appeared in US writing before 1900. Many white Americans were self-employed, but this social experience separated them from the contemporary middle class of today, overwhelmingly employed and surveilled. Today’s highly unequal US hardly qualifies as sustaining the middle class.
Recession Risk Rises But US Still Expected To Grow In Q2
Headwinds for US growth continue to strengthen, but next month’s second-quarter report of GDP is still on track to post a gain, based on the median estimate from a set of nowcasts compiled by CapitaSpectator.com. The question is whether the data deteriorates further between now and the July 28 Q2 release from the Bureau of Economic Analysis? Recent releases suggest that’s strong, or at least rising possibility.