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A Bird's Eye View Blog

Fireside Charts 1.18.19

By:BCM Investment Team | Date:Jan18, 2019 | Category: Equity, Economics, Market Highlights, Fireside Charts

Today we recognize the life of John. C. Bogle, whom we lost on Wednesday. We owe much gratitude to the man who tirelessly dedicated his life to democratizing investing and being an advocate for the financial success of the average investor. The worsening global liquidity growth that we touched upon in Wednesday's blog did not show well in S&P 500 price return. U.S. crude oil hit another record, beating its last high in 2018. Will consumption weaken as manufacturing declines? A chart on U.S. cities poses the question: how much does buying power change as a result of a 0.5% decline in mortgage rates? Finally, some updates on Japan and the Brexit deal vote in the House of Commons in the U.K.

 

We will not be posting this upcoming Monday, January 21st due to the holiday (Martin Luther King Jr. Day). 

 

 

1. Part of the world's Central Bank Quantitative Easing included massive increases to the world's money supply. The withdrawal of this liquidity should have a similar, opposite effect.

 

1.17 chart 4

Source: Macrobond and Nordea, as of 1/17/19 

 

 

2. Buy the rumor, sell the news? ...or is a substantive solution in the cards?

 

1.17 chart 12

Source: WSJ Daily Shot, as of 1/18/19

 

 

3. China's economic weakness is "forcing" the PBoC to stimulate again.

 

1.17 chart 2

Source: Bloomberg, as of 1/17/19

 

 

4. Historically, a defeat like this would end a PM's tenure. However, in an unusual twist, there is no other leader in any party who could form a Government.  So PM May soldiers on...

 

1.17 chart 10

Source: Hansard, as of 1/18/19

 

 

5. Despite modest wage growth, inflation remains tame in the U.S. and Europe.

 

1.17 chart 9

Source: FRED, as of 1/18/19

 

 

6. U.S. and global consumers are generally in much better shape than in 2007. Will they be able to carry the global economy through an obvious manufacturing slowdown?

 

1.17 chart 5-1

Source: Haver Analytics, as of 1/17/19

 

 

7. After months of disappointment, finally a regional FED survey that shows some good news!

 

1.17 chart 8-1

Source: WSJ Daily , as of 1/15/19

 

 

  

8. We shall see if the lower oil prices effects our production...

 

1.17 chart 3

Source: WSJ Daily Shot, as of 1/15/19

 

 

9. A great chart illustrating mortgage rate sensitivity for select cities.

 

1.17 chart 1

Source: Zonda by Meyers Reserch, as of 1/17/19

 

 

10. A look at assets and debt across generations.

 

1.17 chart 7

Source: Howmuch.net, as of 1/17/19

 

  

11. Memory Lane...

 

 1.17 chart 6

Source: Scotiabank Economics, as of 1/16/19

 

 

11. Despite the Abe government's stimulus, inflation in Japan is almost non-existent.

 

1.17 chart 11

Source: Hansard, as of 1/18/19

 

 

 

New year… same market behavior? Volatility is back with a vengeance! Recently, the market was rising and falling 2, 3, and 4% at a time. Read the BCM 4Q 18 Market Commentary for a debriefing on the last quarter, plus volatility insights and earnings we are tracking so far in 2019.

 

View Now: BCM 4Q 2018 Market Commentary 

 

 

Disclosure: The charts and info-graphics contained in this blog are typically based on data obtained from 3rd parties and are believed to be accurate. The commentary included is the opinion of the author and subject to change at any time. Any reference to specific securities or investments are for illustrative purposes only and are not intended as investment advice nor are a recommendation to take any action. Individual securities mentioned may be held in client accounts.