Representative image The Federal Reserve's determination to raise interest rates until it squashes the highest inflation in decades is darkening the outlook across Wall Street, as U.S. stocks stand on the cusp of a bear market and warnings of a recession grow louder. At issue is the so-called Fed put, or investors’ belief that the Fed will take action if stocks fall too deeply, even though it has no mandate to maintain asset prices. One oft-cited example of the phenomenon, which is named after a hedging derivative used to protect against market falls, occurred when the Fed halted a rate hiking cycle in early 2019 after a stock market tantrum. Also Read: Global stocks rebound despite unease over economy; dollar gains This time around, the Fed’s insistence that it will raise rates as high as needed to tame surging inflation has bolstered the argument that policymakers will be less sensitive to market volatility - threatening more pain for investors. read more A recent … [Read more...] about As bear market looms, battered Wall Street seeks elusive ‘Fed put’
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Global equity markets rebounded after the S&P 500 pared losses that briefly took it into bear market territory, and the dollar gained on Friday, as investor unease about Federal Reserve policy tightening to curb inflation kindled fears of a recession. Shares rebounded earlier in Europe and Asia after China cut a key lending benchmark to bolster its weakening economy, helping initially to drive gains on Wall Street. China cut its prime rate for five-year loans, which influences mortgage prices, by 15 basis points in a reduction that was sharper than expected as authorities seek to cushion the impact of an economic slowdown. Also Read: Indian markets should be moving upwards next week, says IIFL’s Sanjiv Bhasin While a late-day rally stopped the S&P 500 from confirming a bear market, the gloom on Wall Street led the benchmark to fall for the seventh consecutive week, an event that has occurred only five times since 1928, according to S&P Dow Jones Indices. … [Read more...] about Global stocks rebound despite unease over economy; dollar gains
Share to Twitter Share to Linkedin Everybody's talking about higher inflation and rising interest rates, but are they worried? Not really. The Fed's on the case, so investors are asking, "Which investments are best to buy?" Barron's has the answer on its January 17 cover (underlining is mine): "2022 Roundtable - Our experts see a strong economy, a volatile market, and a good time for bargain hunting . " Turning to the article for stock ideas, we run into a cautious title, " Time to Buckle Up ," based on this summary: " Wall Street's pandemic-era party appears to be ending. Stocks, bonds, crypto, you name it - almost every asset class has hit a rough patch since 2022 dawned, and things could get worse before they begin to get better . That's the consensus of the 10 investors on Barron's Roundtable, which met this year on Jan. 10, on Zoom. The group looks for inflation to rage and stocks to stumble in the first half of 2022, as the Fed … [Read more...] about Dual Bond And Stock Bear Markets Look Likely
Microsoft’s billionaire co-founder Bill Gates has expressed doubts about cryptocurrencies on several occasions. During an “ask me anything” session on Reddit earlier this week, he explained why he did not buy them. The billionaire philanthropist said he preferred investing in “things that have valuable output”. “The value of companies is based on how they make great products,” he added. “The value of crypto is just what some other person decides someone else will pay for it so not adding to society like other investments.” Bill Gates had denounced cryptocurrencies in an interview to the Wall Street Journal in February. Close “The way cryptocurrency works today allows for certain criminal activities,” he had added. “It would be good to get rid of that.” Gates had also pointed to the volatility of cryptocurrencies in a CNBC interview. “Bitcoin can go up and down just based on the mania or whatever the views are, and I do not have a way of predicting … [Read more...] about Why Bill Gates does not buy cryptocurrencies
Share to Twitter Share to Linkedin An overwhelming number of U.S. registered voters say they support higher tariffs on goods imported from China. According to a poll released this week by Morning Consult, 73% of survey respondents said they support the U.S. government using trade remedies on China to protect U.S. industries and American workers with a similar high number — 71% — supporting the trade war tariffs imposed on $250 billion worth of China imports during the Trump administration. Even with inflation at levels not seen since the 1970s, American voters seem willing to force companies to import from elsewhere or make it locally instead. “I am not surprised by these numbers,” says Harsh Khurana, CEO of WeCultivate, a tech company funded in part by Mark Cuban , that works as a browser extension on Amazon AMZN to show consumers American-made products. “Tariffs hurt the American consumer more than they hurt China's manufacturing because the … [Read more...] about Sorry, China. Most Americans Support Higher Prices On Your Imports.
Share to Twitter Share to Linkedin Market volatility in spades this week! On Tuesday, markets were all a-twitter (oops, can’t use that word!) over the large and unexpected rise in April’s retail sales (+0.8%). That sparked a +2.0% rally in the S&P 500. What market commentators neglected to mention was that, when adjusted for price increases, the “real” number was negative (see chart above – red line). On Tuesday, Fed Chair Powell said that they would continue to tighten financial conditions until “we see inflation coming down,” and that it might not be easy and could come at the expense of a higher unemployment rate. “You’d still have a strong labor market,” he said, “if unemployment were to move up a few ticks. I would say there are a-number-of plausible paths to have a soft, as I said, softish, landing.” Note the reference to higher unemployment and the use of the word “softish” instead of “soft” indicating that the Fed might not be able to tame … [Read more...] about Markets See Looming Recession – The Fed Sees “Softish” Landing
Share to Twitter Share to Linkedin Don't let opportunity slip away. The last two weeks saw media negativity increase. However, economy reports and stock market actions hint at a rebound ahead. Here are the key items to keep in mind... First, this mid-quarter timing is traditionally an excellent time to act : buy, sell and rebalance. The important quarterly earnings reporting is mostly completed. Fund managers are unconstrained, with a full 1-1/2 months remaining before they need to worry about the holdings in their quarterly reports. Second, May is a great month to be optimistic in the northern hemisphere . Late spring and summer await, when spirits are lifted by weather, outdoor activities, vacations and generally relaxed attitudes. Then follows fall into winter, marked by major holidays ending with the launch of the new year: 2023. Third, remember that Wall Street attempts to forecast ahead by about six months . Therefore, expect third and … [Read more...] about Sell? No Way – This Is A Buyers’ Stock Market
PETALING JAYA: Bursa Malaysia is expected to see cautious trading this week due to increasing market volatility, says Rakuten Trade Sdn Bhd vice-president of equity research Thong Pak Leng. He reckoned that the FBM KLCI is likely to move sideways with an upside bias of between 1,545 and 1,565, with immediate resistance at 1,570 and support at 1,540. “We are cautiously optimistic about the local market although there’s improvement in the regional market sentiment as profit-taking is likely to set in,” he told Bernama. As uncertainties continue to dictate sentiment, the index is expected to remain in consolidation mode. For the holiday-shortened week just-ended, the local bourse was mixed amid the steady performance of regional markets and a decline on Wall Street on heightened concerns over the impact of persistently high inflation. On a weekly basis, the FBM KLCI rose 4.71 points to end last week at 1,549.12 from 1,544.41 in the previous week. On the index board, the … [Read more...] about Bursa to trade cautiously this week
Share to Twitter Share to Linkedin In their new Stitcher podcast, Podcrushed , Nava Kavelin, Penn Badgley and Sophie Ansari revisit the anxiety and hilarity of the awkward teen years. The three creators and hosts all bring their unique perspectives to the show. Badgley spent his middle school years as a child actor in Hollywood. Ansari is a former fifth grade teacher who grew up in seven different countries, and Kavelin is a former middle school director who spent her formative years in Puerto Rico. Podcrushed begins each episode with a listener’s middle school story ( stories can be submitted here ), narrated by Badgley and complete with its own musical score. The hosts then welcome a celebrity friend to share an embarrassing middle school story, resulting in a range of tales from first crushes to personal grooming nightmares to schoolyard dramas. Their first guest is Badgley’s former Gossip Girl co-star Leighton Meester. Future guests include Amy … [Read more...] about Penn Badgley Relives The Awkward And Sweet Moments Of Adolescence In New Podcast
Share to Twitter Share to Linkedin One night around 2007, Michael Odupitan and his friend, Terry Fulton, were sitting out on the stoop, enjoying the evening in Lake Worth, Fla. Lake Worth is a neighborhood technically within West Palm Beach, but a whole universe away from the mansions and glittering promenades. In fact, at the high school Odupitan and Fulton attended, two competing gangs had recently emerged. Rap music was helping to create a narrow, violent vision of what young people’s lives could be, Odupitan says. The friends had managed to stay somewhat removed, as athletes. But they still weren’t safe. There had already been shootings. As they bantered back and forth, they saw a car rolling down their street. Then, ominously, the headlights went off. They dove into the bushes. They crawled out a little while later, and that night they said, as they’d said before: “We have to get out of this community.” At that moment, not many people … [Read more...] about Topeka University Recruited A Football Player. What They Got Was A Community Leader.