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Weather Adjusted Employment Losses in March

Even before the negative impact from COVID-19, the employment report in March was going to be disappointing. This is because the better than normal weather boosted employment gains in both January and February, and there was going to be payback in March. The question is: how much? The San Francisco Fed estimates Weather-Adjusted Change in […]

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MBA: Mortgage Applications Decreased, Purchase Applications down 33% YoY

From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey Mortgage applications decreased 17.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending April 3, 2020. … The Refinance Index decreased 19 percent from the previous week and was 144 percent […]

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3 observations amid the COVID-19 crisis

These are unusual times, to say the least. Few in the financial industry have seen a global pandemic and widespread economic shutdown, and we must approach our outlooks with a dose of humility. Our Systematic Active Equity team is bringing together human insight and robust quantitative tools and techniques in seeking to illuminate some of […]

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April 7 Update: US COVID-19 Test Results

Note: the large increase Saturday in test results reported was due to California working through the backlog of pending tests. Test-and-trace is a key criteria in starting to reopen the country.   My current guess is test-and-trace will require around 300,000 tests per day at first since the US is far behind the curve.  Some […]

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The “Square Root Recovery”

This is an interesting way to look at the eventual recovery, from Josh Lehner at the Oregon Office of Economic Analysis: COVID-19: The Square Root Recovery? The thinking is as follows. The sudden stop of the economy sends us into a severe recession overnight. Once the health situation improves some, the curve flattens and caseloads […]

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Phase 4 Disaster Relief

Note: Most of what I proposed in early March was enacted. This includes Federal government adding to unemployment insurance (UI), expanding the coverage of UI, small business loans, free testing and care, and sending money to everyone (and much much more than I proposed).  That was a start. Now is the time to address Phase […]

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CoreLogic: House Prices up 4.1% Year-over-year in February

Notes: This CoreLogic House Price Index report is for February. The recent Case-Shiller index release was for January. The CoreLogic HPI is a three month weighted average and is not seasonally adjusted (NSA). From CoreLogic: CoreLogic Reports February Home Prices Increased by 4.1% Year Over Year CoreLogic® … today released the CoreLogic Home Price Index […]

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Building timeless portfolios

Severe volatility tests even the most disciplined investors. The longest-ever bull market for U.S. stocks came to a halt this year as COVID-19 worries gripped financial markets around the globe. Stock volatility surged, the S&P 500 plunged more than 30% and equities have been sold indiscriminately regardless of their region or sector. Many are left […]

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April 6 Update: US COVID-19 Test Results

Note: the large increase Saturday in test results reported was due to California working through the backlog of pending tests. Test-and-trace is a key criteria in starting to reopen the country.   My current guess is test-and-trace will require around 300,000 tests per day at first since the US is far behind the curve.  Some […]

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Why we are warming up on credit

We see improving outlook for credit – with unprecedented policy action to limit the coronavirus shock in place and sharply lower valuations. Major developed market central banks have committed to keep interest rates low and greatly expanded their balance sheets. This underpins demand for corporate bonds and selected sovereign debt. We upgrade our view on […]

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April 5 Update: US COVID-19 Test Results

Note: the large increase yesterday in test results reported was due to California working through the backlog of pending tests. Test-and-trace is a key criteria in starting to reopen the country.   My current guess is test-and-trace will require around 300,000 tests per day at first since the US is far behind the curve.  Some […]

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April 4 Update: US COVID-19 Test Results Increase; California to Increase Testing Fivefold

From the LA Times: Gov. Gavin Newsom said he ‘owns’ coronavirus testing lapses, announces task force In a Saturday news conference, Newsom announced a task force that he said will work toward a fivefold increase in daily testing in the state by identifying supply shortages and adding testing locations. The announcement comes as California continues […]