The 10% Richest Households in the U.S. Own Almost 70% of All Wealth The 10% richest households in the US used to own 60% of all wealth. Now they own almost 70%. Inequality: you may also like “U.S. Net Worth by Wealth Bracket.” Image: Deutsche Bank Global Research
The Credit Cycle Is Leading the Economic Cycle This great chart shows that an economic slowdows risk is rising. When delinquency rates on consumer loans reach a low, there’s a high probability of a recession on the horizon. Image: Deutsche Bank Global Research
U.S. Credit Card Charge-Off Rates Since 2007 This chart shows that small banks accept high credit risks, while large banks reject high credit risks. You may also like “Why the US Banking System Is Divided in Two Groups?“
The Progression of World GDP This chart shows the percentage of world GDP by major countries/regions and how China’s GDP has risen steadily over the past few decades. Image: Bank of America Merrill Lynch
The Stock Market Continues to Climb the Wall of Worry There is always a good reason not to invest in the stock market, but you may miss a significant portion of your capital growth. Image: Bank of America Merrill Lynch
Commercial and Industrial Loans Continue to Accelerate in the U.S. That’s a positive sign for the U.S. economy. Indeed, U.S. banks wouldn’t be lending if they were concerned about the economic situation. Past three recessions saw bank loans negative year over year.
What Does M1 Money Supply Growth Tell Us About the Next Recession? M1 is the money supply that includes types of money commonly used for payment, basically currency outside banks and checking account balances. This is not the perfect recession indicator, but in recent history, it turns negative at least one year before a recession.
What Is the Recession Probability In the Next 12 Months? The New York Fed’s recession probability model suggests that there is a 27% chance of a recession in the next 12 months. Image: Deutsche Bank Global Research
Why Trade Tensions Are Not Driving the U.S. Stock Market? Because many Unicorns are going public in the United States this year. Secondly, U.S. banks are healthier than ever and liquidity conditions are quite good in the U.S.. So all in all, that’s far more important than trade tensions. Image: Bloomberg
Only 11% of Asset Classes Have Posted Negative Total Returns in 2019 The rally is back, but for how long? According to Deutsche Bank AG, 90% of 70 financial asset classes posted positive total returns. Data for 2019 are through April. Picture Source: The Wall Street Journal
Why Do Eurozone Bond Investors Accept Zero Long-Term Interest Rates? Because they have a deflationary view of the euro area economy. Now, investors are losing so much money just by holding German bonds in real terms (adjusted for inflation). Today, the Germany 10-Year bond yield hits 0% again. Keep in mind that raising interest rates in…