By David O'Malley | December 18, 2017
After a lot of anticipation and a busy congressional review process this fall, it looks highly probable that tax reform will be passed into law this week. With the remaining holdout Republican Senators publicly announcing their support, the path is now clear for the largest change in tax policy in three decades.
By Mark Heppenstall | November 9, 2017
After five years of disappointing returns, this year’s double-digit gains in gold prices have surprised many investors, especially in light of the Federal Reserve’s (Fed) continued monetary policy tightening. Conventional wisdom held that as the Fed hiked short-term interest rates, the higher opportunity cost to own gold would put additional downward pressure on prices.
By David O'Malley | October 30, 2017
This week is a critical week for the bond market as 10-year Treasuries yields are trading above the 2.4% level that has been cited by Bill Gross of Janus as signaling a bear market. This sentiment was reinforced by Jeffrey Gundlach of DoubleLine’s comments when he called this “the moment of truth” for bonds. During the week, several key factors could significantly impact the near term movement of yields.
By John Swarr | October 26, 2017
This week’s Monday Morning O’Malley highlighted the upcoming selection of the next Federal Reserve (Fed) chair. The top candidates for the nomination include Jerome Powell, John Taylor, Janet Yellen, Kevin Warsh, and Gary Cohn. The Chart of the Week shows recent betting odds on who will receive the nomination. While the odds are fun to talk about, this week’s write-up covers the candidates’ viewpoints and policy stances so the risks behind the candidates can be anticipated. Investors should be prepared for any outcome by understanding how each candidate would lead the Fed on key issues including monetary policy, the balance sheet, transparency, and regulation.
By Jen Ripper | September 28, 2017
Nearly ten years ago, the Federal Reserve (Fed) embarked upon what became known as quantitative easing as a way to combat the financial crisis of 2008. With the Fed Funds rate near zero percent, the Fed announced it would purchase U.S. Treasury notes and mortgage-backed securities. After three rounds of quantitative easing, the Fed ended its purchases in late 2014. During that time, the Fed has purchased nearly $1.78 trillion of agency mortgage-backed securities (MBS).
By David O'Malley | September 25, 2017
The stock market held near record levels and interest rates were stable after the Federal Reserve (Fed) announced its much anticipated plan to shrink its balance sheet last week. Despite concerns about the impact of Fed interest rate increases on the long term economy and inflation outlook, the Fed took a constructive view of the dynamics impacting the economy. As a result of the relatively hawkish tone, the odds of a December rate hike increased. I still believe the Fed will hold off on increasing rates until 2018.
By David O'Malley | September 18, 2017
The S&P 500 closed above the 2,500 mark for the first time on Friday. The markets ended a strong week of gains driven by continued favorable conditions for economic growth and the prospects for potentially bipartisan action coming out of Washington.
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