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ProBank Austin Advisor

June 17, 2019 - 1 min read

The FOMC meets this week with widespread expectations of a rate cut. The Federal Open Market Committee meets this week with the bond market already pricing in a cut in managed rates. We do not believe that will happen. The key data piece was released last Friday. Retail sales were up 0.5% for the month…

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ProBank Austin Advisor

June 10, 2019 - 1 min read

The speculative bubble is in the bond market. The labor market report for May released last Friday has solidified forecasts of a Fed cut in managed rates later this year. Nonfarm payrolls were reported as having only increased by 75,000 for the month. The job growth data for March and April were revised downward by…

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ProBank Austin Advisor

June 3, 2019 - 1 min read

We are approaching the time to consider a permanent change in the U.S. economy. Tariffs, tariffs, and more tariffs. That is the only driver of financial asset pricing. Economic fundamentals do not matter. Market interest rates dropped to levels not seen since early 2018 when the Fed was normalizing monetary policy. The yield on the…

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ProBank Austin Advisor

May 29, 2019 - 1 min read

The data being released still does not reflect a direction or trend of economic activity. Financial markets are being held hostage by the inconsistent data released in the last three months and the fear of trade wars. The data released last week was again in conflict. Existing home sales were below expectations for the month…

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ProBank Austin Advisor

May 20, 2019 - 1 min read

No consistent trend is evident from data released in the first four months of this year. The economic data being released continues to create uncertainty with no clear trend. Retail sales for April were reported as having declined by 0.2%. This follows a revised surge of 1.7% in March, a decline of 0.3% for February…

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ProBank Austin Advisor

May 13, 2019 - 1 min read

The labor market continues to tighten but inflation is not accelerating. The conflicting nature of data was highlighted last week. The JOLTS data indicated the number of posted but unfilled job openings increased in March to 7.488 million from 7.142 million at the end of February. The gap between those unemployed and looking for jobs…

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ProBank Austin Advisor

May 6, 2019 - 1 min read

The data from last week confirmed the strong labor market with little inflation condition. The April labor report was much better than anticipated. Nonfarm payrolls increased by 263,000, well above the 185,000 consensus forecast. The prior two months were revised higher by 13,000. The average monthly gain in the first four months of this year…

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ProBank Austin Advisor

April 29, 2019 - 1 min read

The FOMC meets this week and will need to deal with the conflicting data. The believability of data from the first quarter continues to be a problem. The Advance Report of first quarter Real GDP growth was released on Friday. The economy grew at 3.2%, the fastest growth in the first quarter in the past…

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ProBank Austin Advisor

April 22, 2019 - 1 min read

Better consumer spending data and a lower trade deficit should propel growth. The data being released continues to send mixed signals. Last week it was the retail sales numbers. The economy has been thought to be slowing due to a weak consumption side. Retail sales were reported as having declined by a revised 2.1% in…

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ProBank Austin Advisor

April 15, 2019 - 1 min read

Data is finally catching up and appears to confirm February was the anomaly. The flat yield curve has been created by the Fed raising short-term rates over the past three years while investors have not demanded a risk premium for higher inflation. The Fed was trying to normalize monetary policy which is their way of…

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ProBank Austin Advisor

April 8, 2019 - 1 min read

The data released last week lowered the risks of recession this year. The risk of a looming recession was eased with the release of data last week. Nonfarm payrolls increased by 196,000 for March. The consensus expectation was for an increase of 170,000. This increase was below the monthly average of the past year but…

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ProBank Austin Advisor

April 2, 2019 - 1 min read

Which financial market has it right as stocks move up and interest rates move down? The final numbers are in for the fourth quarter. Real GDP growth was revised down to only 2.2% from 2.6% released in the first report. Consumption across the board was revised downward. Personal consumption expenditures were revised down from 2.8%…

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