Aug 7, 2021 | US Equities
Industrial concentration in the US economy has been a persistent theme over the past 3 decades. Corporate profits’ share of GDP has shifted up to a higher level compared with any other time in the post-war period. Source: Bloomberg, Macrobond, Variant...
Jul 17, 2021 | US Equities
A bull market can usually be classified into 3 phases. Phase 1 is where the “easy” gains occur, there is widespread skepticism towards the equity rally and valuation multiples surge in anticipation of the coming recovery in earnings. Source: Bloomberg,...
Jun 18, 2021 | US Equities
President Biden’s 2022 fiscal budget includes proposals for a 39.6% (43.4% with surtax) top long-term capital gains tax rate (in the US long-term capital gains apply on investments owned for 12 months or longer). We don’t know what the final bill will look...
Jun 4, 2021 | US Equities
We have seen much commentary that if US 10y yields go back to 2.5% or 3.0%, then equity markets suffer. We prefer a different way to looking at the problem. The key is what inflation is doing alongside any move in nominal yields. The below chart shows the % of the...
Mar 11, 2021 | US Equities
We look at the performance of equities and intermarket relationships across different real yield and inflation breakeven regimes. Today, real yields are starting to drive changes in nominal yields, which is supportive for equity gains In a recent report for clients,...
Jan 22, 2021 | US Economy, US Equities
Inflation remains one of the few areas where there is not an overwhelming market consensus. We see rising inflation risks The market is running out of non-consensus narratives, now that we can see the vaccine being rolled out and the potential for a strong economic...
Jan 7, 2021 | US Economy, US Equities
The best performing sectors before sweep elections tend to underperform afterwards, and vice versa We dig through the historical data on previous sweep elections and come to two conclusions: 1) sweep elections do mark changes in relative sector performance; and 2) the...
Dec 17, 2020 | US Equities
The remarkable resilience of equity markets this year, along with the general bullish consensus for 2021, has some parallels with previous price action in 2009 and 2017 In 2009, equity markets rallied against a backdrop of a terrible economy, but rising leading...
Nov 19, 2020 | China, European Economy, Global Economy, US Equities
Excerpt from November 10th: The US and China are the current engines of growth, keeping the global recovery on track. A vaccine only reinforces the recoveries in China/US, and should eventually put Europe back on a stronger footing The three main engines of global...
