Category: Blog

Economic Policy Uncertainty vs. Central Bank Uncertainty Economic policy uncertainty is at record highs, while Central Bank uncertainty is at record lows. Image: BofA Merrill Lynch

Probability of US Recession Predicted by Treasury Spread Probability of US recession in the next 12 months: 31.48% Image: Federal Reserve Bank of New York

GDP-Based Recession Indicator Index This index measures the probability that the U.S. economy was in a recession during the indicated quarter. In Q1 2019, the probability of recession was 2.90%. When this recession indicator exceeds 35% (red line), history tells us that the probability of recession is increasing.

S&P 500 Bull and Bear Markets In recent history, past bear markets have been shorter than bull markets. Image: Charles Schwab

Wage Growth, Monetary Policy and S&P 500 When the spread between wage growth and the Fed funds rate is wide, it is generally positive for equities. Image: Topdown Charts

Tariffs Are Raising Prices for U.S. Consumers The charts show that U.S. consumer and producer prices have risen more quickly in tariff-affected categories. This is unfortunate in this late business cycle. Image: Goldman Sachs Global Research

Survey: What Is The Most Effective Risk-Off Hedge? In the latest BofA Merrill Lynch edition of the FX and rates sentiment survey, a majority of respondents preferred 10-year Treasuries as the most effective risk-off hedge. Only 6% of respondents chose gold and the yen. Image: BofA Merrill Lynch

Contribution of Consumption to China’s GDP Growth This chart shows that consumption is the primary driver of China’s economic growth. You may also like “China Real GDP Growth Projection.” Image: ANZ Research

U.S. Budget Deficits and the U.S. Dollar Pretty good correlation between U.S. budget deficits and the U.S. dollar over the past 30 years. The chart suggests that the U.S. dollar should weaken over time. You may also like “U.S. Twin Deficits (% of GDP) Lead Real Trade Weighted Dollar Index by Two Years” and “U.S. Dollar…

U.S. Initial Unemployment Claims and U.S. GDP There is a pretty good correlation between U.S. initial unemployment claims and U.S. GDP. Initial unemployment claims could suggest an acceleration of U.S. GDP in Q3 2019. Click on the Image to Enlarge

The Trade War Effect on Crude Oil This chart shows Chinese imports of crude oil from U.S.. Image: Capital Economics