How Will the Fed’s Interest Rate Cuts Affect You?
Last week, the Federal Reserve announced its first interest rate cut since the early days of the Pandemic. The highly anticipated rate cut resulted in a 50-basis point (half of one percent) reduction in the Federal Funds Rate, an important overnight borrowing rate set by the Federal Reserve. Outside of Covid, the last time the […]
The Federal Reserve FINALLY Raises Rates
Key Takeaways: Last week, the Federal Reserve raised the Federal Funds Rate by 0.25%. The Federal Reserve is projecting several more rate increases in 2022. The Federal Reserve is confident in a strong US economy and the ability for the economy to withstand higher interest rates. Last week the Federal Reserve raised interest […]
Some Perspective on the Fed’s Latest Meeting
Key Takeaways With ongoing inflationary pressures and a continued decline in the unemployment rate, the Fed appears ready to pick up the pace of normalizing monetary policy. The Fed confirmed that at this point they plan to raise the fed funds rate at the March meeting but reiterated that the pace and frequency of rate […]
Latest Data on Inflation and Labor Markets Paving the Way for Fed Rate Cuts
Following the weak jobs report that left many on Wall Street questioning the prospects of a “soft landing,” we’ve seen a bit of unrest in markets over the last few weeks. Remember, a soft landing includes cooling inflation back to the Fed’s 2% target while maintaining a healthy labor market. With a slight crack showing […]
Fed Rates, Inflation, Yields
What a difference a couple of years makes. Even the casual fan has likely heard the talk about interest rates and felt inflation during these past twenty-four months. Two years ago, in February 2021, the Federal Funds target rate was 0 – 0.25%. It remained there until just over a year ago in March 2022. […]
Markets Finally Believe Fed is Serious about Inflation
The Fed raised rates 0.75% last week, the biggest single move since 1994 Market participants imply that rates will move from 1.75% to 3.56% by year-end Perception of a hawkish Fed may help avoid a wage-price spiral & severe recession Last week the Federal Reserve raised rates by 0.75% or 75 basis points (bps). […]
What Happened in the Markets Last Week?
If you have turned on the news or had a conversation around the water cooler over the past week, you have certainly heard that volatility has returned to the stock market. Headlines like “Dow sinks more than 1,000 points in global market sell-off” and “Wall Street Hammered Amid Plunging Global Markets” led on all media […]
The Market’s Breadth Still Stinks but Could Relief Be on the Way?
By: Brian T. Burton, CFP®, CIMA® You’ve probably heard about stock market breadth at this point, it has become quite the talking point amongst financial pundits. But what exactly is it? The term, market breadth, can simply be defined as how many stocks are participating in an index’s rise or fall, helping to assess […]
Two Ways to Combat Household Inflation
Inflation is not a one-size-fits-all all phenomenon Inflation is the increase in prices over time Increasing prices means decreasing purchasing power How we choose to spend our money dictates how we experience inflation Inflation has been top of mind for every participant in our economy for three years straight: households, businesses, and policymakers. Inflation […]
The End of an Era – What We are Watching For in ‘24
For many years until the last, investors had been living under the same mantra of “There Is No Alternative” (TINA) to owning equities, helping prop up stock prices as yields on fixed income were too paltry to bother with. Times have changed; TINA ushered out and TARA welcomed in. Positive real rates are achievable, meaning […]
Beware of Dots
The Federal Reserve Dot Plot has a shaky ten-year history The Dot Plot shows the Fed’s expectations of future interest rates Since its inception in 2012 it has not proved very predictive Rates have been a key driver of equity pricing over the last two years My eighth-grade class celebrated our completion of middle […]
Is Bad News in the Economy Actually Good News for Markets?
The notion of a slowing economy equating to rising stock prices qualifies as counterintuitive, but that is exactly what we’ve seen over the last few months. Typically, positive stock market performance is aligned with strong economic growth, as seen in the chart below. This makes sense as GDP growth means individual companies are producing more, […]
