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Confirmation of the Deterioration in Consumer Confidence


In our mid-quarter update, we highlighted the plunge in the University of Michigan’s consumer confidence indicator, suggesting that “good feelings” among consumers were starting to fade. Often surveys offer a leading glimpse into economic activity. A more confident consumer is more likely to make those big-ticket purchases, like homes and cars, as well as consuming […]

A Deep Dive into Consumer Confidence

sept midq update cover snip

In this mid-quarter special report, we do a deep dive into the University of Michigan survey and discern what it may mean for the vigor of the consumer moving forward, prospects for a recession and consequences for asset allocation. Download the slides here: A Deep Dive into Consumer Confidence.    

German Banks: Cutting Off Nose to Spite Face


Today Germany’s second largest bank, Commerzbank, reported a fourth straight quarter of falling revenue and projected lower profit for the year, suggesting clients have been impacted by trade tensions. Chief Executive Officer Martin Zielke describes the situation: “Despite all the successes we have made, challenges continue to increase for the industry and for us… This […]

The Credit Markets Have Stalled


Credit markets often move before the equity markets, and this can offer helpful information about the near-term path of equity prices. In general, I like to see credit confirming what the equity markets seem to be saying. When credit stalls, like it is now, I take notice. Investment grade spreads recovered about 30bps between January […]

Currency Markets & Knightian Uncertainty


Knightian uncertainty is named after University of Chicago economist Frank Knight (1885–1972), who distinguished risk and uncertainty in his work Risk, Uncertainty, and Profit: “Uncertainty must be taken in a sense radically distinct from the familiar notion of Risk, from which it has never been properly separated…. The essential fact is that ‘risk’ means in some cases a quantity susceptible of measurement, while at […]