Feature Dear Client, In addition to this abbreviated Weekly Report, I am sending you a Special Report written by Mark McClellan, Managing Editor of the monthly Bank Credit Analyst. Mark makes a compelling case that the deflationary…
Highlights Financial markets have slipped into a 'risk off' phase. The upbeat second quarter earnings season in the U.S., Japan and the Eurozone was overwhelmed by a number of negative events. Equity bear markets are usually…
Highlights Monetary Policy: The Fed's inflation forecast will continue to guide interest rate policy. This means that while an announcement about winding down the balance sheet will occur in September, a December rate hike is only…
Highlights Yellen sidesteps monetary policy at Jackson Hole. The Fed raised rates in late 1990s before seeing any inflation. Tax cut deal is still likely... ..but a prolonged debt ceiling battle or government shutdown is not.…
Feature Turkey's banking system has in recent years relied on enormous liquidity provisions by the central bank (Chart I-1) to sustain its ongoing credit boom, and hence economic growth. Since early this year, the authorities have…
Highlights The GOP's failure to repeal Obamacare could rev up the Republicans' motivation to move forward on tax cuts. Fed policymakers are taking financial stability seriously. Constructive conditions for consumer spending…
Highlights The FOMC statement reaffirmed that the Fed remains in hiking mode. If the Fed keeps raising rates in line with the "dots," monetary policy will move into restrictive territory by early 2019. By then, the…
Highlights Markets have gone too far in pricing out the Republican's market-friendly policy agenda. The President desperately needs a win ahead of mid-term elections. A bill that at least cuts taxes should be forming by year end.…