"The economic outlook is clouded again by the abrupt rise in credit spreads since April. Furthermore, the US economy has not been participating in the usual way in the world's economic rebound from the recession of 2008-09."
Economic Barometer – 6/10 |
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~ R. David Ranson, President
and Director of Research
H.C. Wainwright & Co. Economics
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Play a brief audio introduction
from R. David Ranson, President and Director of Research.
Approximate runtime 3 minutes after download - broadband recommended.
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Publication Highlights as of July 1, 2010
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Get the stories behind the headlines here! |
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 The Capitalist Perspective |
| Do we really need a central bank? |
| As a result of the banking collapse and the bailouts that followed, the Fed has become one of the biggest targets in Washington for public distrust. Those who question the ongoing purpose of its existence have a point. Read The Capitalist Perspective now without charge. [ Read ] |
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Interest-Rate Outlook |
| High-yield industry bets based on market signals from gold and spreads |
| Sectors of the junk bond market perform predictably but differently relative to the overall market, in response to movements in gold prices and credit spreads. |
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Equity-Market Outlook |
| Is Shiller's cyclically-adjusted P/E ratio a superior gauge of market valuation? |
| A superior measure of valuation for the stock market should have better predictive power. But Shiller's ratio of price to trailing ten-year earnings is only slightly more predictive than the simple P/E ratio. |
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Strategic Asset Selector |
| How much bullion would equity investors need to hold to insure against inflation? |
| An investment portfolio whose return is independent of changes in the price of gold is, de facto, immune from inflation. We calculate that a mix of 85% equities and 15% gold satisfies this criterion. |
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Fixed-Income Barometer |
| Highlights: |
| The recent rise in credits spreads is worrisome but not yet large enough to imply a substantial weakening in the economy. They should be watched daily. |
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Economic Barometer |
| Highlights: |
| The economic outlook is clouded again by the abrupt rise in credit spreads since April. Furthermore, the US economy has not been participating in the usual way in the world's economic rebound from the recession of 2008-09. |
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Equity-Market Barometer |
| Highlights: |
| At the beginning of June, the US stock market had fallen well below the path implied by previous recoveries. But most of the expected gain since early 2009 had been achieved before then. |
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International Barometer |
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Foreign-exchange Value of the Dollar: Declining relative to most major currencies over the next couple of years.
Equity Markets:
Most favored - Argentina
Least favored - Hong Kong
Bond Markets:
Most favored - Germany
Least favored - U.S., U.K.
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Get the stories behind the headlines here! |
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