Market Note: Wait, Is Inflation Back?
February 16, 2024 – Data released on Tuesday showed that consumer prices increased by 3.1% in January from a year earlier.[1] Though a decrease from December’s 3.4% number, January’s reading was above the economists’ consensus projection of 2.9%.[2] Investors reacted strongly, sending stocks lower and bond yields higher, though by Wednesday, both markets saw a modest […]
Quarterly Update: A Soft Landing into a Hard World
January 12, 2024 – I suspect few will mourn the end of 2023. The year that started with deep concerns over the economy and ended with geopolitical turmoil saw few happy headlines. Despite the turmoil, the US economy had a surprisingly strong year, even as Europe and China struggled to regain their footing. This, in […]
New Cycles
By Avi Deutsch December 7, 2023 – Occasionally, economic periods coincide with the annual rhythm of life, and this December appears to mark one of those instances. A feeling of transition is in the air, marked by cooling inflation, a loosening labor market, and the expectation that the Fed is done raising interest rates. While […]
Market Note: What is a Natural Interest Rate Anyway?
By Avi Deutsch September 14, 2023 Summary of Key Points: _________________________________________ Over 18 months into this tightening cycle, and with headline inflation down to 3.2% as of July, many are wondering when the Fed funds rate will reach its terminal rate, the peak rate of this tightening cycle. But as investors look further out, the […]
Quarterly Update: Jerome Powell’s Soft Landing
By Avi Deutsch July 14, 2023 – Jerome Powell’s (“JP”) biography should make for a fascinating read. The Fed chairman, who was nominated by Donald Trump and is the first non-economist to serve since 1981 has become one of the most powerful figures in today’s economy. Though far from perfect, JP has shown himself to […]
Chicken
By Avi Deutsch May 11, 2023 – Two games of chicken are unfolding in the U.S. economy, the one between investors and the Federal Reserve, and the other between Democrats and Republicans in Washington D.C. Despite the Fed’s recent interest rate hike last week, bond investors continue to expect that the Fed will cut rates […]
Quarterly Update: A Wobbly Tight Rope
April 14, 2023 – The Fed’s mandate to guide the US economy through monetary policy is often likened to steering a cargo freighter, though a Rube Goldberg machine may be a more apt analogy. Between the Fed and the US economy stand a dizzying array of national and regional banks, as well as non-bank lenders. […]
Unforced Errors
By Avi Deutsch March 17, 2023 – The financial infrastructure that enables the modern economy is a work of wonder. A global machinery of banks, brokerage firms, investment banks, stock exchanges, fund managers, and insurance companies hums in the background of our lives. This machinery is governed by a bewildering array of domestic governments and […]
Silicon Valley Bank (SVB) Failure
March 10, 2023 – Today’s news about Silicon Valley Bank (SVB) took everyone by surprise. In the span of just a few hours, the country’s 16th-largest bank went into FDIC receivership. Most of you will not have heard of SVB prior to today — they mostly serve as a corporate banker, predominantly in the venture […]
Mixed Messages
February 9, 2023 – The first two weeks of February provided investors with a series of contradicting signals about the state of the economy. It began with the Federal Open Market Committee meeting on February 1st, where the Fed, as expected, raised interest rates by 25bps to a range of 4.5-4.75%. While the decision itself […]
Tech Employees’ Stockholdings Have Taken a Hit. Financial Pros Offer Advice
January 4, 2023 – Managing Director, Avi Deutsch was featured in Barron’s discussing ‘Tech Employees’ Stockholdings Have Taken a Hit. Financial Pros Offer Advice.’ “Clients who are young can afford to have a lot of exposure to an individual company,” says Deutsch. “They also have some opportunities around lower stock prices in terms of how they negotiate their compensation: […]
Five Things Investors Will Remember About 2022
By Avi Deutsch December 28, 2022 – All years are different, but some years are more different than others. For investors, 2022 falls squarely into the latter category, as many of the events that transpired represent a paradigm shift from the principles that dominated our financial markets since the global financial crisis of 2008. Whether […]