October Update

This month saw a couple more leading economic indicators turn red. There are now 5 out of 14 indicators underwater. A couple haven't come in yet for the month. The S&P500 could turn negative anytime. But labor is still strong and the yield curve hasn't inverted yet, although it might this next month when the Fed is expected to make another rate increase. If the yield curve and the market turn negative, that would be enough to put half the indicators underwater. 

In addition, Europe has slowed and is possibly in a recession already. China is said to be slowing as well. With ongoing trade disputes, the future is uncertain.

Comments

Post a Comment

Popular posts from this blog

June Update

Trade wars, rising interest rates and chaos at the border has kept the markets in check for now. At least the news on North Korea has settled down a bit. Emerging markets seem to be in a downtrend. The US economy is still strong though, for now (but for how long) as tax cuts and new government deficits work their way through the system. I'm standing pat for now and sticking to the plan. But it's hard to ignore the headlines these days.
Read more

March

Wow, almost thru March, how time flies. Well, here we are, the economy still muddling along. The yield curve apparently inverted, or one definition of it did, anyway. The Federal Reserve has stood down for now. The markets are trying to figure out what to make of it all. Meanwhile, I'm getting an education in the joys of market timing. The aforementioned yield curve inversion is a good example. It is supposed to be one of the premier signals of a coming recession. But there are different definitions of said inversion. And then there is the endless second guessing about whether this time is different. Long rates are SO low, maybe the signal won't work the same now. And everyone is so aware of the yield curve as a signal now, maybe it can't work the same if everybody is expecting it. And if it does work, who knows what the lag time will be. So the yield curve is just one leading indicator that is fraught with issues. But there are about a dozen more that I watch and try t...
Read more