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Policy and Regulatory Commentary
How the Federal Reserve is like Spike from Happy Days
As a child of the 70s, I have come to embrace a few, eternal truths: disco should have never died; big collars were a good idea, and the Fonz was the coolest guy who ever lived. Speaking of the Fonz, I am reminded of a Happy Days episode featuring Spike, the Fonz’s nephew, and how that episode and Spike can help us all better understand monetary policy today. Seriously.
Market Outlooks
Economic Data Reflects Shutdown, but Market Rallies
After one of the worst months and quarters in years, April saw a sharp rebound in equity markets as some of the worst-case COVID-19 scenarios did not materialize.
Market Outlooks
Pick a letter, any letter
If one considers that the coronavirus didn’t hit the US economy hard until mid-March, and that our economy has been shut down since, a recession is a foregone conclusion, with Q2 GDP expected to contract about 30% Q to Q
Macroeconomic & Geopolitical
Creative Destruction
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Economist Joseph Schumpeter coined the phrase “creative destruction” to describe the way innovation in the manufacturing process increases productivity while destroying the old way of doing things as a new efficient way is developed.
Market Outlooks
THE BOND BLUES
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The blues have hit the bond market, but we believe current dislocations can create opportunities for active managers of individual bond portfolios.
Market Outlooks
Weekly Wire: When it rains
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Most of the focus on COVID-19 has understandably been on its physical impact, but the psychological impact of a pandemic is also worth considering. Social interaction is a huge source of psychological wellbeing, and its loss, paired with concerns about the market, as well as the health and wellbeing of loved ones, can begin to take a psychological toll.
Market Outlooks
SUNDAY NIGHT SURPRISE
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In attempt to go all in, the Federal Reserve cut rates on Sunday night to the lower bound, 0-0.25% and announced a $700 billion Quantitative Easing (QE) program.
Market Outlooks
A PERFECT STORM: PANDEMIC, PETROLEUM AND POLITICS
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Stocks were hit hard yesterday as coronavirus fears spread, oil prices plummeted, and uncertainties on the political front continued to linger.
Market Outlooks
Weekly Wire: The Fed lowers, Biden rises…Now what?
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Market volatility continued through the last week due to ongoing concerns surrounding the spread of COVID19, the shifting Democratic presidential candidate landscape, and their combined economic impact. We’ve experienced wild daily moves in the S&P 500 Index (S&P 500), but as of Wednesday’s close, we’re just 7.5% below the all-time high reached on February 19.
Market Outlooks
Continuing concerns regarding COVID-19
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The global equity markets have continued their decline, which began on February 20, in response to fears over the COVID-19 (coronavirus) becoming a global pandemic. The S&P 500 Index fell -12.0% from February 20-27 and is on pace for another decline on February 28. International equity markets have fared better, with the MSCI EAFE and MSCI Emerging Markets indices declining -7.4% and -6.6%, respectively. The last six days has been the fastest correction (10% drawdown) on record for the S&P 500 off an all-time high, which has likely exacerbated market fears. With the drawdown, the markets are pricing in significant earnings declines as a result of the virus, and certainly weaker global economic activity.
Market Outlooks
Coronavirus Fears Wash Away New Market Highs
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Coronavirus fears hit the markets as concerns mount that the virus is now accelerating outside of China with cases growing in South Korea, Italy, Iran, and the United States. Panic set in during Monday’s trading session with the major U.S. stock indices all down over 3% with more than 90% of total volume being to the downside, and the CBOE Volatility Index surging nearly 50%.
Market Outlooks
Weekly Wire: Vlog: Quarter-end Q&A 4Q2019
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Tim Holland, CFA, asks and answers those questions we think will be top of mind for clients as they open their quarterly statements and think back on the quarter that was: