Nov 26, 2015 | US Economy
Over the past four years, companies that have bought back their stock have outperformed the market significantly. Most companies did not finance the buybacks with internal cash flow and borrowed at low rates to buy their own shares. The cost of debt is mispriced, so...
Oct 14, 2015 | Leading Indicators, US Economy
All of our leading indicators for credit spreads and volatility point to wider volatility and higher credit spreads over the next two years. The credit cycle is long in the tooth, and the best predictor of future credit spreads is the lagged growth in lending. For a...
Sep 23, 2015 | Global Economy, US Economy
Structural factors are ensuring that the unemployment rate in the US today is not what it was in periods past. Yellen has seemed to be more in the camp that the decline in the labour participation rate (PR) since the crisis has been mainly cyclical in nature and...
Jun 2, 2015 | Leading Indicators, US Economy
There has been a sharp divergence between ISM services and non-services in the US. Many of our leading indicators for manufacturing have pointed to weakness. This suggests demand is tilting away from manufacturing and towards the service sector. The breakdown of the...
Apr 29, 2015 | US Economy
(The following is from our December Leading Indicator Watch (LIW), released December 4th, 2014. The LIW is a monthly report giving a summary of all or our main leading indicators, allowing clients to forecast early on where the business cycle in major countries is...
Apr 28, 2015 | US Economy
(from our Leading Indicator Watch from March 5th, 2015) Our leading indicator for US house prices is supportive of an improvement in price growth. One of the inputs that drives our leading index is the number of months’ supply of new homes. The continued fall in...
Apr 15, 2015 | US Economy
US manufacturing has slowed in recent months, and we expect more to come. We had noted the discrepancy between the PMI and ISM surveys earlier this year as it looked like the ISM was outputting data inconsistent with our leading indicators. The ISM has now fallen...
Nov 24, 2014 | Leading Indicators, US Economy
Despite the subdued nature of US CPI, some large components are turning up. Owners’ equivalent rent and rent of primary residence, which together account almost of a third of the CPI basket, are turning up strongly. A low vacancy rate and a relatively resilient US...
