Tensions in the Sand Pile

Tensions in the Sand Pile

Monday, June 9 At the bottom of an hourglass, the pile of sand grows with each new grain. The cone shape looks stable, but it’s not. Under the surface, instable paths form that will eventually trigger a collapse once there’s enough weight. Markets and economies...
A Warning Sign from Consumers

A Warning Sign from Consumers

May 26, 2025 People have their favorite ways to evaluate economics. But I suggest you forget the twists of tariff policy and what pundits are saying on the news to instead focus on one thing. This one thing will help you gauge the health of the economy and influence...
Don’t Expect a V-Shaped Bottom

Don’t Expect a V-Shaped Bottom

May 19, 2025 Serious damage has been done to markets. The S&P 500 fell 21% by mid-April from its all-time high. Similarly, the Invesco QQQ Trust exchange-traded fund, which tracks big technology companies, has plunged 26%. Both major indices are now well below...
The Federal Reserve’s Tools Might Be Ineffective

The Federal Reserve’s Tools Might Be Ineffective

May 12, 2025 The economy in the 2020s has not been boring. We’ve had a pandemic and inflation already. Now we have a trade war, recession fears, maybe more inflation, and capital flying out of U.S. dollar assets. In the past, the Federal Reserve would often step in to...
Stocks Were Bound to Correct

Stocks Were Bound to Correct

May 5, 2025 A lot has happened in the markets in 2025. But the truth is stocks were due to fall, whether from tariffs or something else. Not long ago, the stock market was trading at the highest prices measured against earnings. Stocks were more expensive than in 1929...
No Easy, Painless Way to Cure Inflation

No Easy, Painless Way to Cure Inflation

April 28, 2025 In 1979, Federal Reserve Chair Paul Volcker inherited a real mess. Government overspending led to budget deficits and a massive increase in the national debt. By 1974, inflation climbed to as high as 12%. To combat that, the Fed raised interest rates as...