Investing

Losses aren’t the only risk to worry about

Given today’s headlines – including an impeachment inquiry, trade wars, and a looming Brexit deadline – it’s not surprising that investors are particularly concerned about the potential for equity market volatility. But risk is always present for investors — and the possibility of losing money is just one form it can take. Below, I describe […]

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Comments on September Housing Starts

Earlier: Housing Starts decreased to 1.256 Million Annual Rate in September Total housing starts in September were below expectations, however starts for July and August were revised up combined. The housing starts report showed starts were down 9.4% in September compared to August, and starts were up 1.6% year-over-year compared to September 2018. Single family […]

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Philly Fed Manufacturing shows slow Growth in October

From the Philly Fed: Current Manufacturing Indexes Suggest Growth in October Manufacturing activity in the region continued to grow, according to results from the October Manufacturing Business Outlook Survey. The survey’s broad indicators remained positive, although their movements were mixed this month: The general activity and shipments indicators decreased from their readings last month, but […]

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Industrial Production Decreased in September

From the Fed: Industrial Production and Capacity Utilization Industrial production fell back 0.4 percent in September after advancing 0.8 percent in August. For the third quarter, industrial production rose at an annual rate of 1.2 percent following declines of about 2 percent in both the first and the second quarters. Manufacturing production decreased 0.5 percent […]

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Housing Starts decreased to 1.256 Million Annual Rate in September

From the Census Bureau: Permits, Starts and Completions Housing Starts:Privately‐owned housing starts in September were at a seasonally adjusted annual rate of 1,256,000. This is 9.4 percent below the revised August estimate of 1,386,000, but is 1.6 percent above the September 2018 rate of 1,236,000. Single‐family housing starts in September were at a rate of […]

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Japanese equities: still in the doldrums

Japanese equities have been the star performer since September – rising more dramatically than their global peers in a response to a perceived thaw in U.S.-China trade tensions. Yet we maintain our underweight on Japanese equities: They are particularly vulnerable to a growth slowdown in China, and we see no sustained letup in the protectionist […]

Investing

QE X: Jay Powell, Thou protest too much

In its efforts to not lose control of the policy rate-setting mechanism and manage the repurchase agreement (repo) rate, the US Federal Reserve (Fed) recently announced a new initiative to buy several hundred billion dollars’ worth of Treasury bills over the next few quarters. That it would do something to control the financing rates for […]

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CAR on California Housing: Low Rates “Bolster” Sales in September

The CAR reported: Greater buying power amid historically low rates bolsters September home sales, C.A.R. reports Amid the most favorable mortgage interest rates in nearly three years, California’s housing market recorded a third consecutive year-over-year sales increase as month-over-month sales remained essentially flat, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today. Closed escrow sales of […]

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NAHB: “Builder Confidence Hits 20-Month High”

The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 71 in October, up from 68 in September. Any number above 50 indicates that more builders view sales conditions as good than poor. From NAHB: Builder Confidence Hits 20-Month High Builder confidence in the market for newly-built single-family homes rose three […]

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Retail Sales decreased 0.3% in September

On a monthly basis, retail sales decreased 0.3 percent from August to September (seasonally adjusted), and sales were up 4.1 percent from September 2018. From the Census Bureau report: Advance estimates of U.S. retail and food services sales for September 2019, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, […]

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WTF: Where are the factors?

My colleagues and I have about the fact that factors are long-term drivers of investment returns.  Given this, it’s no surprise that investors are increasingly adopting factor strategies in their portfolios. In fact, we’ve seen record inflows YTD with over $18 billion in investments in iShares Factor ETFs. Logic would follow that investors’ portfolios exhibit […]

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Wednesday: Retail Sales, Homebuilder Survey

Wednesday:• At 7:00 AM ET, The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index. • At 8:30 AM, Retail sales for September will be released.  The consensus is for a 0.3% increase in retail sales. • At 10:00 AM, The October NAHB homebuilder survey. The consensus is for a […]

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Housing and Recessions

Now that new home sales have reached a new cycle high (in June), I’d like to update a couple of graphs in a previous post (most of this from an earlier post). For the economy, what we should be focused on are single family starts and new home sales. As I noted in Investment and […]