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  John Authers Wall Street Journal 7 February 2024 https://www.bloomberg.com/opinion/articles/2024-02-07/china-markets-year-of-the-dragon-or-the-dead-cat-bounce

 SvD/TT 2 februari 2024 https://www.svd.se/a/76WP18/marknaden-tror-pa-halverad-ranta-2025 Riksbanken ser det inte som uteslutet att en första sänkning kan komma under första halvåret i år https://englundmacro.blogspot.com/2024/02/riksbanken-ser-det-inte-som-uteslutet.html Swedbanks basportfölj: Aktierna du ska äga (di.se)

  DI 1 februari 2024 https://www.di.se/live/riksbanken-oppnar-for-rantesankning-under-forsta-halvaret/

The problem, if it can be called that, is that the economy appears to be in rude health. These are not the numbers that would be produced by an economy desperately in need of a rate cut. Ben Bernanke’s record is very defensible, but his best-known quote by far is his comment in the summer of 2007 that the “vast majority of mortgages, including even subprime mortgages, continue to perform well.”  https://www.cnbc.com/id/18718555 There’s a widespread belief in markets that the FOMC will want to do all it can to avert a Trump victory in November, and therefore cut rates sooner than otherwise.  Whether or not this is true, it does make it harder to cut; Donald Trump would doubtless call foul, and heap derision /hån/ on Jerome Powell and his colleagues. John Authers Bloomberg 26 januari 2024 https://www.bloomberg.com/opinion/articles/2024-01-26/inflation-politics-fed-fears-being-sucked-into-a-rate-cut-riptide About Ben Bernanke at International Communications Rolf Englund (internet...

Alla kurvor pekar uppåt 25 January 2024 1535 CET “We are wondering whether a bout of irrational exuberance might push the multiple higher, inflating a speculative bubble in the stock market as occurred during the late 1990s.” Consider the seven largest tech firms that also include Apple, Alphabet, Amazon.com, Meta Platforms and Tesla.  Trading at 49 times profits, the cohort looks very expensive next to a P/E ratio of 17 for the average stock in the S&P 500. Ed Yardeni Bloomberg 24 januari 2024 https://www.bloomberg.com/news/articles/2024-01-24/ed-yardeni-is-getting-nervous-about-the-speed-of-s-p-500-s-rally Just 25 days into 2024, the S&P 500 has already blown past the Wall Street consensus target for its performance for the end of this year. The unbridled optimism is grounded in the promise of artificial intelligence that caught fire with the arrival of the ChatGPT app in November 2022. That rationale has lost its novelty now, but it’s still bringing the market to levels ...

As the Hang Seng Index selloff deepens, bankers and traders are preparing for the worst. This does not feel like 2008 when the Global Financial Crisis hit  but 1998 — in the midst of the Asia Financial Crisis — a few people who have been around long enough lamented to me recently. The late 1990s crisis started with Thailand.   But if another one erupts, China will be its root cause, and Hong Kong the epicenter. January is not over yet, and the Hang Seng Index already has slumped by over 10%, making it the worst-performing among major global indexes. People nowadays question the city’s viability as a financial center, reminiscent of the prevailing sentiment in the aftermath of the 1997 handover. Bloomberg 23 januari 2024 https://www.bloomberg.com/opinion/articles/2024-01-23/china-economy-hong-kong-faces-repeat-of-1998-asia-financial-crisis China Moves to Boost Bank Lending in Broad Effort to Prop Up Growth - WSJ China Moves to Boost Bank Lending the central bank would lower the...

The average rate on 30-year mortgage, at 6.6% is about 3 percentage points higher than before the pandemic.  Prices are much higher too, the median existing single-family home sold in December fetched $387,000, versus $277,000 in December 2019. Put the two together and affordability is far worse than before. With so many homeowners locking in low rates before and during the early part of the pandemic, they are loath to move and sell. Friday’s report showed the fewest existing homes were sold last year since 1995. There is no quick solution here.  Perversely, housing looks as if it could boost economic growth this year. Construction was started on a seasonally adjusted 1.09 million homes in the fourth quarter—the most since the second quarter of 2022. WSJ 19 January 2024 https://www.wsj.com/economy/housing/the-economy-is-starting-to-look-normalhousing-isnt-66266f5d US homeowners now pay around 7 percent on their new 30-year mortgages Many have loans far less cheaper. Good for t...

  https://www.bloomberg.com/news/articles/2024-01-21/asian-stocks-to-climb-after-s-p-500-hits-record-markets-wrap These Seven Tech Stocks Are Driving the Market https://www.nytimes.com/interactive/2024/01/22/business/magnificent-seven-stocks-tech.html   Big tech is powering the stock market higher. Again. The largest tech stocks, which dominated the stock market last year, have once again rallied. The group has pulled the S&P 500 back to record highs for the first time in two years. Investors are once again pouring money into tech shares in a bid to keep pace. WSJ 24 January 2024 ‘Magnificent Seven’ Tech Stocks Including Nvidia and Microsoft Are on Top Again - WSJ US 30-Year Yield Reaches Year-to-Date High After Poor Auction Sale of five-year notes drew a higher-than-expected yield Expectations for Fed interest-rate cuts continue to ebb 24 januari 2024 at 19:40 CET The longest-maturity Treasury yield rose more than 5 basis points to nearly 4.42% US 30-Year Yield ...

Ledstjärnan för den ekonomiska politiken har länge varit att spara i ladorna. Ingen svensk finansminister har vågat rucka på målet om överskott Men nu är det hög tid att tänka om, anser Lars Calmfors - Vi har en tillfällig utgiftstopp framför oss, med investeringar i eftersatt infrastruktur, klimatrelaterade investeringar, stöd till Ukraina och en extra anskaffning av försvarsmateriel. Då är det en grundläggande princip att man kan låna till det”, säger han. Lösningen, anser Lars Calmfors, är att skrota dagens överskottsmål och ersätta det med ett underskottsmål på en halv procent av BNP.  Det skulle frigöra ungefär 50 miljarder kronor om året till investeringar. Men det kommer inte att räcka. DI 21 januari 2024 https://www.di.se/nyheter/historisk-upprustning-satter-politikerna-i-miljardknipa/ Under tre decennier var överskott det självklara målet.  För tre månader sedan blev balansmål den nya normen. Och sedan tre veckor eller så är det i stället underskottsmål som gäller....

  China’s $6.3 Trillion Stock Rout Getting Uglier by the Day - Bloomberg

  MarketWatch 19 January 2024 https://www.marketwatch.com/story/one-sector-is-camouflaging-the-markets-recent-deterioration-it-can-only-last-so-long-says-this-technical-analyst-265aa68e Is it really such a safe bet that the Federal Reserve is going to cut interest rates early and often this year?  The problem is that if the economy looks to be strong, then there’s less need for a central bank to cut interest rates.  higher bond yields haven’t led to a major stock market selloff, with the US moving roughly sideways for the year.  Why are the bets on cuts still so strong?  Much of it derives from a reading of the Fed and its political motivations.  The central bank is supposed to be independent. But let’s assume (as many do) that it’s driven by an urge to help Joe Biden retain the presidency Early rate cuts might help their man, although it’s unlikely the effects would be felt much by voters this side of the election. Any monetary easing at any point this yea...

  The graph, which I have created with a little help from data from the Federal Reserve St. Louis' FRED database, and which I have processed through ChatGPT 4.0, illustrates what has happened. In 2020-21, the USA implemented massive monetary and fiscal policy easing. Basically, the American government sent money directly to every citizen. These funds were financed by the government issuing treasury bonds, which the Federal Reserve purchased with newly printed American dollars. This money circulated in the American economy. The money supply consists of two parts: physical notes and coins in circulation and deposits in banks. The graph below shows the total deposits in the banks - adjusted for inflation. Lars Christensen The Market Monetarist 19 January 2024 https://marketmonetarist.com/2024/01/19/why-soaring-rates-have-failed-to-kill-us-growth/ Very good. But this might have someting to do with it. Institutions and investors together have a record $5.7 trillion parked in cash-like m...

Institutions and investors together have a record $5.7 trillion parked in cash-like money-market funds, many of which are yielding above 5%,  Some on Wall Street see the cash as a bullish signal and a potential tailwind for stocks and bonds if the inflation outlook continues to improve.  Others say some of that money has simply shifted to higher-yielding money markets from traditional bank accounts. They question the idea that the money is waiting on the sidelines and ready to enter the market. WSJ 26 November 2023 https://www.wsj.com/finance/stocks/investors-are-hungry-for-riskand-holding-record-cash-sums-6fe43275 Money-market funds Englund: How the Federal Reserve drained the financial system of deposits  

Commercial property crisis threatens a fresh wave of US bank failures Emergency lending by the US federal authorities has bathed America’s struggling regional banks in short-term liquidity, disguising the slow-burn damage of the US commercial property slump. A sobering analysis by four of the country’s leading finance experts says this comfort blanket has created a beguiling illusion of stability. The underlying crisis in the banking system continues to deepen as $5 trillion of commercial real estate debt taken out during the zero-rate era comes due in tranches. “It’s not a liquidity problem; it’s a solvency problem,” said Professor Tomasz Piskorski Ambrose Evans-Pritchard 5 January 2024  https://www.telegraph.co.uk/business/2024/01/05/fed-rate-cuts-too-late-to-avert-fresh-wave-us-bank-failures/ A rising wave of property defaults threatens hundreds of US banks Lenders are still gambling on resurrection, a reflex of ‘extend and pretend’ in the hope that office rents will recover and...

Now valued at $2.73 trillion, Microsoft is worth about $100 billion less than Apple, which is valued at $2.83 trillion. MarketWatch 4 January 2024 https://www.marketwatch.com/story/microsoft-gets-closer-to-overtaking-apple-as-most-valuable-u-s-company-c3d9b639

Following the strong year in 2023, the S&P 500 is now +3% in two years, but the Nasdaq is still -2% since the end of 2021 As for the fixed-income market’s recovery, investment-grade corporate bonds gained 8% in 2023 “but are still down 8% in two years,” the BofA strategists said. And although long-term Treasurys “eked out” gains in 2023, they remained “the worst-performing asset class in two years,” the strategists wrote, pointing to a 26% loss. MarketWatch 3 January 2024 https://www.marketwatch.com/story/these-magnificent-7-stocks-remain-under-water-since-end-of-2021-while-nasdaq-still-down-despite-huge-2023-rally-45df7c17   S&P 500  Englund: Skriande uppenbart (englundmacro.blogspot.com)

  Almost no one thought 2023 would be a blockbuster year for stocks. They could hardly have been more wrong. A mania surrounding artificial intelligence and big technology stocks sent the Nasdaq Composite soaring 44%.  It is a far cry from the doom and gloom many were bracing for at the start of 2023. WSJ 29 December 2023 https://www.wsj.com/finance/stocks/what-did-wall-street-get-right-about-markets-this-year-not-much-7d4368fe Nasdaq Set For Best Year Since 1999  Bonds set for best two-month rally on record; dollar weakens Global equities poised for highest level since February 2022 Bloomberg 27 December 2023 https://www.bloomberg.com/news/articles/2023-12-27/stock-market-today-dow-s-p-live-updates It is good practice to learn from your mistakes, but even better is to learn from other people’s mistakes.   My biggest error in 2023 was the same as everyone else’s: being in the consensus that the fastest rate hikes in 40 years would cause a recession.  I thought i...

  Sedan botten 27 oktober har Stockholmsbörsens OMXSPI-index stigit med 18 procent. https://englundmacro.blogspot.com/2023/12/sedan-botten-27-oktober-har.html

Hög inflation och höjda räntor har slagit hårt mot främst räntekänsliga hushåll och bostadsbyggandet. Arbetslösheten fortsätter att stiga och toppar på 8,5 procent i slutet av 2024. KPIF-inflationen har kommit ner från dryga 10 procent förra året till 3,6 procent i november, främst till följd av lägre energipriser och internationella råvarupriser. Riksbanken inleder därför en serie räntesänkningar från och med nästa sommar. 20/12 https://www.di.se/live/ki-fran-2024-vaxer-sveriges-ekonomi-igen/ Dow Jones ends 475 points lower after 9-day winning streak - MarketWatch Erik Thedéen ”Den senaste tidens utveckling talar för att inflationen ska kunna fortsätta sjunka utan att vi höjer räntan ytterligare”  ”Förhoppningsvis kommer återgången till målet att ske genom en förhållandevis mild inbromsning i ekonomin. Det är givetvis vår ambition att det ska bli på sättet”, sa Thedéen. https://www.riksbank.se/sv/press-och-publicerat/tal-och-presentationer/2023/thedeen-vi-har-lardomar-att-dra-av-d...