Market and Economy

Diligence is the mother of good luck ~ Benjamin Franklin

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Quantitative Tightening (QT) Starts Slowly Allowing Markets to Rebound

Building Benjamins

June 2022 Economic and Market Review

Economic and Market Review June 30, 2022 Inflation Becomes a Cost-of-Living Crisis Attention has shifted from inflation to recession as housing, wages, interest rates, commodities, and consumer expenditures have all receded from their highs, an indication to economists that an economic slowdown or recession may be evolving. Numerous countries worldwide are restricting the export of…

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Visualizing the Three Different Types of Inflation

Building Benjamins

May 2022 Economic and Market Review

Economic and Market Review May 30, 2022 Inflation Slows Cools Off, but Consumers are Still Feeling the Heat There’s a growing consensus among various economists and market analysts that inflation could force consumers to cut back on spending to the extent that a recession materializes. Consumer expenditures have an enormous impact on economic activity, representing…

Caution

QT (Quantitative Tightening) starts next month. Liquidity exiting system is negative for stocks

• QT (Quantitative Tightening) starts next month. Liquidity exiting system is negative for stocks
• QT or Tapering marks the end to Quantitative Easing which started in 2008.
• Fed is expected to raise Short-Term Federal Reserve Rates rapidly as well, but this is less important than liquidity of the size the the Federal Reserve Balance.
• QT will in my opinion have a negative impact on stocks.

Building Benjamins

April 2022 Economic and Market Review

Economic and Market Review April 30, 2022 Economic Chilling The most recent inflation data released revealed an 8.5% annual increase, yet came in below what many analysts had expected. A consensus is forming, among economists and analysts, that inflation may be peaking. The hope is that the Fed may ease its rapid rate rise trajectory…

Building Benjamins

The Probability of a Recession is Increasing, Trimming, or Selling Parts of the Portfolio.

• Inflation forcing the Fed to stop Quantitative Easing and start Quantitative Tightening.
• Federal Reserve has started to move Fed Funds Rate up.
• Russian invasion of Ukraine will disrupt energy, food and commodity supplies.
• China has another big Covid lockdown which will disrupt supply chains.

Building Benjamins

Tapering QE, Fed Balance Sheet, Interest Rates, Oh My!

Quantitative Tightening Scheduled to Begin This Week.
Fed looks to Aggressively Increase Fed Funds Rate over next several meetings.

Our report from March 11th gives you background information on what you need to know.

Building Benjamins

What the Fed’s ‘Quantitative Tightening’ Plans Mean

Roughly two years after it launched the biggest and broadest monetary-stimulus campaign in modern history, the Federal Reserve is in the process of withdrawing its support for the U.S. economy. The most delicate element of the plan is likely to be shrinking its record balance sheet — something that ended up roiling financial markets the last time policy makers did it. A road map for quantitative tightening, as it’s known, was released April 6, and policy makers have signaled it’s likely to begin in May.

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Quantitative Tightening set to Begin. Stay Cautious. Fed set to raise short rates aggressively.

The Federal Reserve (The Fed) is talking about Tapering Quantitative Easing (QE) and raising the Fed Funds Rate (FFR). The QE tool helped bail out the highly levered and bankrupt US financial system during the 2008 Financial Crisis. The Fed has used it several times since then. The Fed has also stated its intentions to raise interest rates to fight the highest inflation in 40 years. Quantitative Tightening set to Begin. Stay Cautious. Fed set to raise short rates aggressively.

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