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A Bird's Eye View Blog

Fireside Charts 2.6.19

by : BCM Investment Team | POSTED: Feb06, 2019 | CATEGORY: Equity, Economics, Market Highlights, Fireside Charts

Tariff talks resume in Washington this week between the U.S. and China following the State of the Union and a few strong (and surprising!) earnings reports. With global orders declining, the export growth has also gone south as a result of the trade dispute. If the FED does in fact raise rates, it will surprise the markets. Despite the potential economic and environmental detriments of owning a truck vs. a car, truck sales have been steadily rising since 2011. The persistent uncertainty around Brexit is also taking a toll on Ireland. 

 

1. Tariffs destroy trade, reduced trade lowers revenues, lower revenues decreases earnings....

 

2.6 chart 8-1

Source: Bianco Research, as of 2/6/19

 

 

2. A quick reminder of the effects of tariffs and the trade war. How can this be good for the U.S.?

 

2.6 chart 7

Source: Haver, as of 2/6/19

 

 

3. This is a worrisome trend and correlation....

 

2.6 chart 3-1

Source: WSJ Daily Shot, as of 2/6/19

 

 

4. If the FED does raise rates again it will surprise the markets...

 

2.6 chart 10

Source: Bloomberg, as of 2/5/19

 

 

5. Is this just common sense or do they see something most economists do not?

 

 2.6 chart 1

Source: WSJ Daily Shot; as of 2/05/19

 

 

 

6. This trend transcends energy prices. Now if they would just bring back the Chevy S-10 like the Ford Ranger...

 

2.6 chart 2

Source: Autodata, as of 2/6/19

 

 

 

7. Now the U.K.'s purchasing Managers Index is near contraction (50). The trend is the concern... 

 

2.6 chart 4

Source: WSJ Daily Shot, as of 2/6/19

 

 

8. The concern is that where a country's PMI goes, the GDP often follows... 

 

 2.6 chart 5

Source: IHS Markit, as of 2/6/19

 

 

9. Brexit may be harder on Ireland than the U.K.

 

2.6 chart 6

Source: WSJ Daily Shot, as of 2/5/19 

 

 

 

 

With MLB opening day still 50 days away, baseball statistics weren’t on our minds until we came across this chart. However, the “batting average” of the S&P 500 Index after a 20% drawdown gave us pause. What if we told you that the S&P 500 was almost TWICE as likely to fall over the next year after experiencing a 20% drawdown? Read our blog to learn about when large drawdowns are more likely to occur:

 

The Probability of Another 20%+ Drawdown is Higher Than You Might Expect

 

 

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.