After Yield-Curve Inversions, Stocks Show No Clear Pattern A yield curve inversion is a necessary condition for a recession, but after yield-curve inversions, stocks show no clear pattern. Image: MSCI
30-Year Mortgage Rates vs. 10-Year Treasury Yield There is a very high correlation between the 30-year mortgage rates and the 10-year treasury yield 30-year mortgage rates = 1.739 x (10-year treasury yield)² + 0.7755 x (10-year treasury yield) + 0.0227 R² = 0.9787 Image: Calculated Risk
US Long-Term Mortgage Rates Decline: 30-Year Average 4.10% & 15-Year Average 3.57% Why US long-term mortgage rates decline? Mortgage costs are influenced by the 10-year Treasury yield which was lower this week, because the trade war between the United States and China pushes investors moving money from stocks to bonds. Bond yields fall as prices rise.…
Income Shares of the Top 1% in Various Countries The richest 1% of Americans take 20% of national income, but the richest 1% of the Dutch people only 6%. Denmark and the Netherlands are the countries that are the most equal. Image: World Economic Forum
IPOs Tend to Underperform the Market The evidence shows that, despite their higher risk, initial public offerings make poor investments. You may also like “Unicorn IPOs, Are They Good Investments?“
Sell in May and Go Away Is a Myth The S&P 500 Total Return from 1928 to 2018 shows that “Sell in May and Go Away” was not a winning strategy. Image: Charlie Bilello
Slow Growth is Good for Stocks In this Late-Cycle Expansion Slow growth maximises the length of the current US business cycle, and this is bullish for stocks. Image: James A. Kostohryz
S&P 500 1-Month Volatility History Since 1928 and VIX Since 1990 The stock market crash of 1929, the Black Monday of 1987 and the global financial crisis in 2008 were the most extreme events. Image: Goldman Sachs Global Investment Research
Leon Cooperman: Bull Market Cycles Don’t End at Fair Valuation, They Ended at Overvaluation “There is still more room for the market to run. We have a slowdown but not a recession and the market is ok.” Leon Cooperman (Omega Advisors founder) is a great value investor. https://www.youtube.com/watch?v=Xz6ihkuW1AM
One of the Best Yield Curves to Predict a Recession is Coming The spread between the 30-year and the 3-month treasury yields is one of the best recession signal of all the yield spreads. In recent history, a recession occurs about 12 to 18 months after the yield curve inverts. When an inverted yield curve…
Why Are Oil and Gas Companies Making Massive Investments for the Next 10 Years? Oil and gas companies are making massive investments for good reasons. The energy demand will flatten after 2030 and the oil and gas industry will go through a transition over the next decades. Below is the oil and gas forecast to 2050.…