Market Brief – Monday 9/30/19

The U.S. Treasury denied reports that Chinese companies could be delisted from U.S. stock exchanges which sent U.S. equity futures higher Sunday evening once the futures market opened. South Korea reported one of its hog farms has been infected with the contagious African Swine Flu. China said they hope the next round of trade talks … Read more

The Fed’s Easing Will Trigger a Global Recession

In last week’s update, Blame the Fed for the Global Economic Slowdown, Not the Tariffs, I wrote about how the Federal Reserve’s monetary tightening caused the current global economic slowdown by reducing the amount of U.S. Dollars available for global trade. As the world’s reserve currency, global trade is conducted in dollars, and by removing … Read more

Market Brief – Friday 9/27/19

In overnight trading, China Industrial Profit fell by -2.0% on a year-over-year basis for the month of August which sent Asian equities lower. China’s stock market will close next Tuesday through the following Monday for Chinese National Day, and Hong Kong’s markets will be closed Tuesday for holiday. Personal Incomes rose in August by +0.4% … Read more

Market Brief – Thursday 9/26/19

Stocks wasted no time unwinding yesterday’s rally as liquidity conditions continue to dry up. The New York Fed’s overnight repo operation was increased to $100 billion today but only saw $50.1 billion in bids, which is a sign the liquidity constraint might be easing. The NY Fed’s 14-day repo operation was increased from $30 billion … Read more

Market Brief – Wednesday 9/25/19

While being interpreted as a gesture of goodwill, China is expected to buy more U.S. pork products as its stockpile of meats is rapidly diminishing after the African Swine Flu decimated pork production. China is circling the globe and buying up as much meat as it can. Agricultural commodities were higher in early trading. The … Read more

Market Brief – Tuesday 9/24/19

In overnight trading, Asia continues to export deflation. The August Producer Price Index on a year-over-year basis fell -0.6% for South Korea, -0.8% for China and -0.9% for Japan. Lower Asian producer prices will lead to lower consumer prices for American’s. China has issued waivers for the import of up to 2-3 million tons of … Read more

Market Brief – Monday 9/23/19

U.S. equity futures wasted no time shrugging off Friday’s drop as the futures market rallied on trade war optimism. The overnight optimism was ruined on news out of South Korea, Germany, and Saudi Arabia. Crude oil started the week trading higher after the Wall Street Journal report on Saudi Aramco that it may take eight … Read more

Blame the Fed for the Global Economic Slowdown, Not the Tariffs

Excluding the U.S. stock market, the global economy is rapidly slowing down. Most people believe it has to do with the trade war, but the global slowdown started long before the tariffs started as every economic expansion and contraction begins with the Federal Reserve easing or tightening monetary policy. While investors remain optimistic that this … Read more

Market Brief – Friday 9/20/19

Quadruple-witching day is upon us once again many futures and options contracts expire, which usually means for a fairly volatile day. For the fourth day in a row, the New York Fed conducted repo operations and this morning they injected $75 billion of overnight liquidity against $75.55 billion of offers. While the markets are breathing … Read more

Market Brief – Thursday 9/19/19

After Fed Chair Powell dismissed the overnight repo operations by the New York Fed as temporary liquidity injections to deal with the third-quarter tax payments, the New York Fed announced after yesterday’s market close that they will conduct a third repo operation up to $75 billion before markets open tomorrow. Investors will be closely watching … Read more