CRE

CRE

Fed "Stress Test" Results Are Out: Everyone Passes Even As VIX Hits 70

Moments ago the Fed released the first phase of its annual stress test which, once again, found that all thirty-four of the US largest banks "passed", exceeding minimum projected capital and leverage ratios under severely adverse scenarios, based on their projected ability to withstand economic shocks

Valuations: It Is Different This Time

"Stock investors have been waiting on the Godot of growth for most of this century and one can’t help but wonder at what point they’ll get up and leave the theater..."

We Now Know "Who Hit The Brakes" As Loan Creation Crashes To Six Year Low

We can now close the book on the WSJ's previously unanswered question of "who hit the breaks?" The answe the US consumer, the driver behind 70% of US GDP, officially tapped out. In fact, it was almost as if US consumers were hit by a perfect storm of adverse events in late 2016 and early 2017

Presenting Goldman's "Worst-Case Survival Guide To Uncertainty, Taxes And Trade"

The juxtaposition of rising policy uncertainty vis a vis declining fear in risk assets raises "cause for pause" according to Goldman, which in its latest Portfolio Manager's Toolkit lays out the following "worst-case survival guide to uncertainty, taxes and trade" to help investors navigate once volatility comes back with a bang.

Crushed Vol Boosts Dollar, Commodities; Futures Flat

Asian stocks declined, while European stocks rose to the highest since 2015, led by a rebound in commodities and basic resource stocks. U.S. stock-index futures were little changed at 2,395 - just shy of all time highs - as investors focused on corporate earnings after the French election, while the VIX hovered near its lowest level since 1993.

Key Events In The Coming Week: Inflation, Spending In The Spotlight

With the French election now finally in the rearview mirror, this week's focus is on global inflation releases, with the spotlight falling on the US and China. We also have BoE and RBNZ rates meetings. In other data we note industrial production in the Eurozone, UK and Norway along with US retail sales and Fed speakers.

RBC Explains Today's Rush To BTFD

"the missile strikes change NONE of the calculus for me...Thus, the balance of risk remains in favor of upside for now until this muscle memory above (buy risk dips, sell vol) is changed... The near-to-medium-term ‘risk downside’ story to me remains largely about the rates move as ‘reflation’ has broken trend line..."

Are Markets Overlooking A Clear & Present Danger?

Economic cycles do not last indefinitely. While fiscal and monetary policies can extend cycles by “pulling forward” future consumption, such actions create an eventual “void” that cannot be filled. In fact, there is mounting evidence the “event horizon” may have been reached as seen through the lens of auto sales.

Weekend Reading: Lack Of Perspective

"While it is often said it is only “time IN the market” that matters, investors must remember “time” is the one commodity we can not replace."