Between Jobs

By | 2017-07-17T12:21:18+00:00 June 6th, 2017|Global Market Update|

Are we working hard, or hardly working? Man shoveling at construction site. Photo: Igor Ovsyannykov. Source: Fancycrave Both. The unemployment rate declined to its lowest level since 2001. Employers added jobs for the 80th straight month – the longest such streak on record. Wages are up 2.5% from a year ago – more than the 2% wage gains we were seeing last year, and significantly more than the 1.5% inflation rate. But unemployment fell because people are leaving the workforce. The labor force shrank [...]

Inflation Nation (Part 1)

By | 2017-07-17T12:21:32+00:00 January 4th, 2017|Global Market Update|

Why isn’t inflation coming back? Year-over-year CPI change. Source: Bloomberg In the ‘60s and ‘70s inflation grew out of control. Nixon’s price controls didn’t stop it. But it settled down after Paul Volker’s restrictive monetary policy and Alan Greenspan’s careful management of the Fed. Economist Milton Friedman famously claimed that inflation is “always and everywhere a monetary phenomenon.” But after the financial crisis, inflation dipped below zero and the Fed flooded the economy with money. Many feared that inflation would come roaring back. But [...]

Swimming Upstream

By | 2017-07-17T12:21:36+00:00 December 2nd, 2016|Global Market Update|

What are we missing? Great Barracuda. Photo: Clark Anderson/Aquaimages. Source: Wikipedia There’s a story about two young fish swimming upstream who meet an older fish heading downstream. The old fish nods at them as he goes by and says, “Morning boys. How’s the water?” The two young fish swim on a bit. Eventually one of them looks over at his friend and asks, “What’s water?” Sometimes the most obvious, important realities are the ones that are the hardest to see. Most of what we [...]

Molasses?

By | 2017-07-17T12:21:40+00:00 October 18th, 2016|Global Market Update|

Why is the economy growing so slowly? Source: St. Louis Fed Since the Great Recession, the economy has never gotten back into high gear. We’ve always seemed to be teetering on the edge of another downturn. Quarterly economic growth has averaged 2%, while a normal recovery is usually above 3.5%. Why? First, the workforce is changing. We are now entering the period where baby-boomers are beginning to retire. Like most things the boomers have gotten involved with, they are transforming retirement. Their family finances [...]

Euro Futures

By | 2017-07-17T12:21:56+00:00 May 25th, 2016|Global Market Update|

Is the Eurozone dying? Photo: Dave Meier. Source: Picography It’s certainly facing tough times. Economically moribund, most Euro government bonds carry negative interest rates. Countries on the economic periphery still face crushing debt service. Unemployment remains above 10% -- the same level it was shortly after the Great Recession. And soon Britain will vote to leave the EU. Who can blame them? Who wants to tie their economic future to a 20-ton anchor? But bad as things are right now, they were significantly worse [...]

Moving Out?

By | 2017-07-17T12:22:06+00:00 March 22nd, 2016|Global Market Update|

Has America’s economy become less mobile? Photo: Dwight Burdette. Source: Wikipedia Labor market mobility in the US has declined. It used to be that when an area was depressed, people moved to where there were better opportunities. But following the financial crisis, more folks stayed put and simply dropped out of the labor force—either retiring or going on disability. This has broad implications for wages, productivity, and overall economic growth. Migration across state lines from areas of high joblessness to areas of low unemployment [...]

Working, Saving, Retiring

By | 2017-07-17T12:23:03+00:00 February 23rd, 2015|Global Market Update|

Are you ready for retirement? Source: International Living Over half of us aren’t. Ultra-low interest rates, Social Security’s rising age for full benefits, and stricter rules on mortgages have combined to make it extremely difficult for families to maintain their pre-retirement standard of living. […]

Banking on Change (Part 3)

By | 2017-07-17T12:34:15+00:00 September 10th, 2014|Global Market Update|

The world is getting older and more urban. Source: UN In 1970 the global median age was 21 and there were 70 people per square mile. By 2020 the median age will be 31 and there will be 150 people per square mile. This means bank customers are looking for different kinds of services. Older customers tend to be wealthier and need ways to manage what they have. […]

Structure, Schmucture

By | 2017-07-17T12:34:54+00:00 May 15th, 2012|Global Market Update, Recession|

Where have all the jobs gone?There’s a cottage industry growing up around the question as to whether current unemployment is cyclical or structural. That is, whether it represents a short-term consumer-based pullback in aggregate demand, or whether it comes from a mismatch between labor skills and the kinds of jobs employers want to fill right now. With over 88 million people not in the labor force, it’s an important question.It’s important because of the policy implications. […]

A Population Bomb?

By | 2012-02-09T11:13:02+00:00 February 9th, 2012|Global Market Update, New Markets|

Are demographics destiny?That’s what a couple of researchers sought to find out. Using UN population numbers and economic and capital market data, they looked at 60 years worth of information in 176 countries. Because demographic data are fairly predictable and individual behavior follows a life-cycle pattern of education, production, saving, and retirement, they attempted to fit a mathematical function  to see what the next ten years might look like for different regions of the world.What did they find? […]