China-US Tech War: US Govt Moves to Block TikTok, WeChat

In an escalation of the ongoing China-US tech war, the US Commerce Department Thursday announced restrictions on new downloads and updates of two popular Chinese-owned mobile apps – WeChat and TikTok – citing a need to safeguard the national security of the United States. “The Chinese Communist Party (CCP) has demonstrated the means and motives […]
Read More »

Housing Sector Fueled by Low Rates

While the retail and manufacturing sectors continue to improve from their spring lows, neither have received the benefits of record low interest rates as much as the housing sector. In the upcoming light data week, August home sales data will take centre stage. After double digit gains in July, it’s possible that the rates for […]
Read More »

Fed’s Bullard: Economy Can Bounce Back Quickly

St Louis Fed President James Bullard Friday offered a sunny view of the economic outlook, saying the economy continues to rebound as businesses adapt to the pandemic, and unemployment is headed down to 6.5% by December. Bullard said much of the rise in unemployment has been due to temporary layoffs, and most workers in this […]
Read More »

BoE Leaves Policy Unchanged; Sets Stage for Easing

The Bank of England made no changes to its benchmark rate or quantitative easing package at Wednesday’s rate setting meeting, but left the door wide open for policy changes at its next gathering in November. Interest rates remain at a record low of 0.1%, while the total stock of the current quantitative easing package stays […]
Read More »

August Housing Starts Slow Due to Drop in Multi-Family

The US August home building data, released Thursday, were weaker than expected. However, the data represent the shift toward single-family homes and away from condos and apartments as buyers seek more space and larger homes since the COVID-19 quarantines. The pace of housing starts fell by 5.1% to a 1.416 million annual rate, well below […]
Read More »

FOMC Doubles Down on Inflation Overshooting

The new era of Federal Reserve policy allowing an overshoot of its 2% inflation target for an extended time launched Wednesday with two Federal Open Market Committee dissents after a “robust discussion.” There were, however, few expectations expressed that even reaching the 2% target would be possible for at least two more years and exceeding […]
Read More »

Retail Sales Growth Slows Further, Up 0.6% in August

Retail sales rose for the fourth straight month in August, but the pace of growth continues to slow as the initial post-shutdown burst is running out of strength. Total retail sales rose by 0.6%, below the 1.0% gain expected and following a 0.9% gain in July. Sales fell due to COVID in the spring before […]
Read More »

US Industrial Production Data Suggest Recovery Slowing

Industrial production posted another gain in August, continuing the string of gains since state reopenings began. However, the pace of growth slowed considerably, evidence that the recovery is running out of steam. Industrial production rose by only 0.4%, well below the 1.2% increase expected, with declines in both utilities and mining production offsetting another manufacturing […]
Read More »

Is It Too Early to Care About 2023?

The upcoming week’s key events are concentrated into the middle of the week, with Wednesday’s FOMC meeting the highlight. While it is doubtful that the meeting will produce anything earth-shattering, it should confirm the shift in attention toward improving the employment situation and supporting the economic recovery rather than worrying about inflation bubbling up. As […]
Read More »

FOMC Preps for New Monetary Framework Era

There was very little chance the Federal Reserve was going to raise interest rates anytime soon but, just to make sure, the Fed’s rate-setting Federal Open Market Committee gave itself a dual justification for holding rates down indefinitely with the new monetary policy framework it announced on August 27. Not only did the FOMC give […]
Read More »

Profit & Loss is no longer publishing

Thank you for 21 great years of support