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North American Decade Part II-International Businesses Increasing U.S. Investments—Biden Industrial Policy for Select Industries Taking Hold—Expanding Legacy Chip Fabs Now–Leading Edge Chip Fabs by Decade End—AI Drives Accelerating Electric Demand–Electric Energy Demand Forecasts Doubled in Two Years—IRA Tax Incentives Aid U.S. Solar Cost Competitiveness–Energy Department Financing Critical BatteryMetal Domestic Source Development—Invest Using Specialized Sector ETF’s

Date Posted: March 21, 2024
Focus on Domestic Production—Incentivizes International Businesses to Increase U.S. Investments The Administration’s Industrial Policy initiatives, in place for nearly two years, focus on advancing clean energy development and promoting leading-edge chip production through a series of key legislation. With the head wind of higher interest rates …

THE NORTH AMERICAN DECADE?—INDUSTRIAL POLICY LEADS TO REPATRIATING ASSEMBLY AND DISTRIBUTION FACILITIES— ENHANCED REGIONAL SUPPLY CHAIN RESILIENCE–HIGH LABOR COST MANUFACTURING RESHORED TO MEXICO—BENEFITS LONG-TERM INVESTMENTS IN AUTOMATION/AI– NORTH/SOUTH LOGISTIC SYSTEMS/DIRECT CARRIERS–MEXICAN STOCKS–SELECT EMERGING MARKET FUNDS

Date Posted: January 3, 2024
The North American Decade—Industrial Policy-Rebuilding Assembly, Manufacturing and Distribution in North America This Commentary, along with a future one, outlines our forecast for a North American decade. The Biden Administration’s Industrial Policy coupled with building resilient regional supply chains could potentially steer our economy to…

TAX HIKES COMING?–CURRENT TAX LAW SUNSETS IN 2025— 2024 ELECTIONS KEY TO FUTURE TAX LAW CHANGES—FISCAL LIMITS FOR DEFENSE AND SOCIAL SPENDING—RAPIDLY RISING INTEREST COSTS AND DEFICITS – PRESSURES FOR NEW REVENUE SOURCES–VALUE ADDED TAX IN OUR FUTURE?–FED PIVOT—LENGTHEN FIXED INCOME DURATION

Date Posted: December 19, 2023
Current Tax Law Sunsets in 2025–2024 Elections Key to Future Tax Changes Next year’s elections will prove crucial for investors as the 2017 Tax Cuts and Jobs Act (TCJA) sunsets at the end of 2025. The next President and Congress will need to address this challenge amid record budget deficits and interest costs. Those imbalances will limit fisca…

Fed Rate Cut Late In First-half Of 2024?—creates Reinvestment Risk For New Short-term Investments Made Early In 2024 –record Budget Deficits–higher Rates For Longer—end Of Abnormal ”cheap Money” Era?—attractive Real Long-term Treasury Rates—2017 Tax Law Expires In 2025—2024 Elections Key To New Tax Legislation—

Date Posted: October 31, 2023
Higher for Longer—The Likely First Rate Cut—Reinvestment Risk for Treasury Bills Follows Our previous Commentaries focused on how the Fed’s failed stop-and-go rate experience in the seventies could potentially shape current policies. Given those concerns, members of the Federal Open Market Committee (FOMC) project only two rate cuts for 2024 …

FED A HAWKISH HOLD—OCTOBER/NOVEMBER FED MEETING LIKELY ANOTHER HOLD—BUT A CLOSE CALL—FED HIGHER FOR LONGER—RATE CUT UNLIKELY BEFORE SECOND QUARTER— HIGHER RATES, LONGER REFLECT ECONOMIC RESILIENCE

Date Posted: September 22, 2023
OCTOBER/NOVEMBER RATE DECISION WILL LIKELY DEPEND IMPORTANTLY ON THREE CPI AND FOUR PCE PRICE INDEX REPORTS PRECEEDING THAT MEETING—CLOSE CALL BUT EXPECT FUNDS RATE UNCHANGED IN NOVEMBER In its September meeting, the Fed kept an unchanged but hawkish hold on its target range of 5.25-5.50%. Out of the nineteen members of the Open Market Commi…

Fed Manages Unprecedented Tightening Cycle—core Inflation Outlook Trending Favorably–declining Wage Increases Will Likely Reflect Pass-through Of Lower Future Inflation—history Shows Relative Stable Equity Markets In Presidential Election Year — July Funds Rate The Peak Rate?—peak Rate Continues Some Time Into 2024

Date Posted: August 21, 2023
Fed Manages Unprecedented Tightening Cycle—so Far Successfully—reduced Inflation While Unemployment Remained Historcally Low The Recent July Consumer Price Index (Cpi) Report Underscores The Fed’s Apparent Success, So Far, In Effectively Managing Inflation While Simultaneously Keeping Historically Low Unemployment Rates. This Achievement Woul…

Economic Momentum Perplexes Forecasters—interest Sensitive Sectors Defy Fed’s Rate Increases–consumer Spending Slowed After January—dwindling Excess Consumer Savings Clouds Holiday Spending— Encouraging Inflation Signs—could July Rate Hike Be The Peak?

Date Posted: July 11, 2023
Economic Momentum Perplexes Forecasters The Covid Pandemic Caused, In Part, Disruptions And Accelerated Changes That Continue To Puzzle Economic Forecasters In The Current Economic Environment. A Clear Example Of This Can Be Seen In The Better Than Expected 2% Growth For The Final Estimate Of First Quarter’s Real Gdp Growth. However, The Growth…

In Remembrance of Our Dear Friend, Harry Markowitz

Date Posted: June 8, 2023
With a deep sense of admiration and sorrow, we pay tribute to an exceptional person, our friend and colleague, Dr. Harry Markowitz. The sorrow stems from losing a close friend and mentor that always made time to listen, learn, laugh, and provide guidance. The admiration comes from the tremendous legacy Harry leaves behind as an intellectual gia…

Post-covid Disruptions Produce Both Greater Economic Uncertainties And New Investment Opportunities—excess Savings Supports Consumer Spending Through The Holiday Season——fed Should Stabilize Inflation By Setting A Range Rather Than A Single Point Inflation Goal—investors Should Expand Ther Focus Into 2024 To Take Advantage Of Narrow Breadth Market Rally

Date Posted: June 8, 2023
Post-covid Disruptions Produce Greater Economic Uncertainties The May Jobs Report Surprised Everyone By Substantially Exceeding All Forecasts. This Example Highlights The Frustrations Economists Face Attempting To Forecast The Current Economic Outlook. The Most Forecasted Recession In History Remains Just That, With Its Likelihood Pushed Furthe…

Fed Dancing Between The Raindrops—fighting Inflation While Avoiding Economic Hit—5-5.25% Likely Peak Funds Rate–core Services Inflation Trending Lower—positive Impact On Pce Price Index–shelter Inflation Likely Trending Lower In The Second Half— Positive Impact On Cpi

Date Posted: May 4, 2023
Fed Dancing Between The Raindrops—fighting Inflation—avoiding Recession— Fed To Keep Funds Rate Steady Until Year-end—strongly Committed To 2 Percent Inflation Objective—5-5.25% Likely Peak Funds Rate Act One Of The Hiking Cycle Likely Ended With The Fed Increasing Its Funds By 25 Bps To 5-5.25 Percent. The Fed Signaled This Funds Rate Will Lik…