For the past year, we’ve heard various predictions and prognostications from economic experts about an impending recession. Some have called for a downturn by the end of this year. Others maintain that there could be a recession—along with a contentious election—next year. And yet another group of analysts are calling for the longest uninterrupted economic…
Consumer Sentiment: A Wall Street “Sell” Signal?DetailsWe all know that the financial markets cannot continue to climb indefinitely. Stocks have routinely collapsed throughout history, and bad things have been set in motion by a variety of factors, like speculation, inflation, asset bubbles, bank failures, mass unemployment, and geopolitics. Market crashes wipe out what’s called “paper wealth,” leaving a wake of decimated “paper millionaires” who, according to Investopedia, are individuals with “a high net worth as a result of the large total market value of the assets he or she owns.” Many of us with robust pensions or 401(k)s may…
Paper Wealth, Paper Millionaires, and the Paper RichDetailsEurope has just posted downright dismal PMI (Purchasing Managers’ Index) numbers. The Purchasing Managers’ Index is a leading indicator of manufacturing activity and a carefully watched barometer of economic health. The latest PMI flash data that covers 19 countries in the European Union suggests that the eurozone could be moving closer to recession. A PMI reading above 50 generally suggests an economic expansion, while anything below 50 indicates a contraction. The monthly flash report for September (an advanced indicator) fell from…
The Mighty German Engine Is Sputtering—so Goes the Eurozone?DetailsThe infamous 1929 crash of the U.S. stock market heralded the economic meltdown that became known as the Great Depression. The turmoil of the Great Depression lasted 10 years, etching its place in history as the worst economic slump ever in the industrialized world. About half of the banks in the U.S. collapsed. Millions of…
What You Can Learn from Stock Market CrashesDetailsBaby boomers are the children of the Greatest Generation and most often defined as those born between 1946 and 1964 during the post–World War II baby boom that saw the U.S. population surge by more than 76 million. Boomers, however, have proven to be great in their own right. They’re a hardworking, entrepreneurial generation that…
What Keeps Baby Boomers Awake at Night?DetailsIn a year of dramatic stock volatility, trade struggles, profit worries, bond mayhem, and endless recession timelines, it’s easy to become immune to the various “dire” economic warnings that arise each week. But sometimes one indicator takes you by surprise. The Institute for Supply Management’s Manufacturing Index fell to 49.1 in August, the lowest level…
Has U.S. Manufacturing Fired a Warning Shot?DetailsFor over a year, the U.S.-China trade war has been daily water cooler talk at every big bank and investment firm from Wall Street to Main Street. And with good reason. It has created uncertainty and volatility—and by many accounts, it has reduced global growth to a crawl. Each new round of tariffs unnerves the…
Has the Fed Lost Its Mojo?DetailsIn October, the People’s Republic of China will turn 70 years old. It was established when the People’s Liberation Army (PLA) defeated the Nationalist Party during the Chinese Civil War (1945–1949). Mao Zedong, the leader of the PLA, formally declared the creation of a “democratic dictatorship” on October 1, 1949, and went on
If China Stumbles, Will the Global Economy Fall Down?DetailsIf you follow the news at all—and we’re sure you do—you’ve heard about an election coming up in 2020. You’ve also heard about rising fears of a recession. The already contentious presidential election and the increasingly worrisome economy appear to be on a collision course. Unfortunately, no one has a crystal ball that can precisely…
Could the Next Presidential Election Tip the Economic Scale?DetailsOverinvestment, overindulgence, and fiscal binging—call it what you will, but it always seems to lead to a head-pounding day of reckoning. The “hangover theory” is a business-cycle philosophy that famed economist Paul Krugman summarized back in 1998: “In the beginning, an investment boom gets out of hand. Maybe excessive money creation or reckless bank lending…
Spiking the Punch Bowl: The Economic Hangover TheoryDetails“We may well be at the most dangerous financial moment since the 2009 Financial Crisis with current developments between the U.S. and China.” –Former Treasury Secretary Larry Summers China’s move to devalue its currency sent markets reeling and gold soaring on Monday. The People’s Bank of China said the devaluation was “due to the effects…
China Strikes Back: Stocks, Soybeans, and CurrencyDetailsUpbeat earnings, rosy job reports, rate-cut chatter, a red-hot labor market, and robust consumer spending—it certainly has been high times on Wall Street. One is reminded of the days of excess, the “greed is good,” white-collar culture of billion-dollar deals, spending benders, and banks behaving badly. The current appetite in stocks is nothing short of…
An Economic Crossroad: Where Exuberance Meets RecklessnessDetails
