Looser Financial Conditions Should Support Economic Growth and Stocks in the Second Half

Proxy metrics for financial conditions from the US dollar, to interest rates to corporate bond spreads have been loosening since June and suggest continued moderate economic growth in the second half of 2017 and a firm equity market. In this post we’ll briefly highlight how these measures of financial conditions point to a firmer manufacturing […]

Coal is Dead and Other Thoughts on Fossil Fuels from Peter Zeihan

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With energy setting records as the worst performing sector year-to-date, we were curious about Geopolitical Strategist Peter Zeihan’s thoughts on fossil fuels in the context of the United States’ continued retreat from the global theater. We recently caught up with Peter to ask his opinion. Below are excerpts from that conversation. KLC: What are your […]

Quarterly Strategy Update: Structural Rotation

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This quarter, we look at two important structural changes that appear to be underway: a normalization in US and European monetary policy and a normalization in crude oil inventories. We expect these two trends to have important ramifications for equity sector leadership trends. In addition, we expect the growth-driven equity leadership that has prevailed for the last […]

One (more) Reason to Expect the USD to Continue to Fall

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The USD is weak again today and plunging lows not seen for 15 months. The “obvious” reasons for the USD weakness include converging foreign economic activity, more hawkish foreign monetary policies, and a general overvaluation of USD. All of those reasons we outlined here. Yet, another less obvious catalyst for USD weakness is taking shape […]

Three Reasons to Expect a Stronger Euro in the Months to Come, and What it Means for Your Portfolio

With the euro up another 50bps today against the USD, we thought it timely to review some fundamental factors that should act to support the longer-term trend higher in the euro. No doubt, this week’s substantial move was partially instigated by what were viewed as hawkish remarks by the ECB. Yet, there are at least […]

JOLTed

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Today’s release of the Job Openings & Labor Turnover (JOLTs) revealed a few interesting observations about the US labor market. First, the pace of hires is fading. Keep in mind JOLTs data is released a month after employment data, so we are looking at April stats in the following charts. This fading in new hires […]