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July 25, 2024 | Premium Service | As we slowly make our way through Q2 2024 earnings, the big question in the minds of investors and political candidates is the economy. The Federal Open Market Committee is happy to see the economy slow ever so slowly, one major reason why the Committee is unlikely to cut rates in 2024. Nearly half of CFO's in survey done by PNC's Gus Faucher see NO cuts this year , reports Kathleen Hays .

August 2, 2024 | Premium Service  | With the post-COVID economy finally going into a stall, Wall Street has managed to convince itself that the Federal Open Market Committee is going to cut the target rate for fed funds in September. This is just two months before a contentious general election. Some bold pundits have even decided that the FOMC will give us three rate cuts between now and January 2025. We still like the no or one rate cut in '24 narrative, but Federal Reserve Chairman Jerome Powell may decide to get political on his way out the door.

August 5, 2024 | Updated | Premium Service  | Last month during a trip to wine country, we were confronted by an economic conundrum that is relevant to banks and markets as we prepare for a global equity market reset. After years of suppressed inflation and low quality economic performance, global investors have finally pressed the red button on equity valuations.

August 14, 2024 | Premium Service | As August ends and the 2024 political season gets into full swing, we want to remind our readers of a 2020 comment by Achim Dübel in Berlin (“ Achim Dübel: Geopolitical Risks of the 2020 Election ”).

August 19, 2024 | Premium Service | Last week, as we wrote our comment about the investment by Bank of Nova Scotia (BNS) in KeyCorp (KEY) , we went to the National Information Center of the FFIEC to check a number from the Q1 data. Normally, the Federal Reserve Board does not release the bank holding company performance reports (BHCPRs) or aggregate data until day 75 after the quarter close, an absurd delay that has been SOP for many years.

August 26, 2024 | Premium Service  | With the crowd on Wall Street unanimous in their belief that interest rates are falling and inflation is no longer a problem, it's is probably time to load up on duration for the Nantucket Sleigh Ride  down the yield curve. This does not mean that we won’t see a significant market correction later in the decade, but now is not time to fight the Fed. Take what is given.

September 3, 2024 | Premium Service  | Just what happened to the great recession of 2024, as the BLS revises GDP up to 3% in Q2 2024 ? " Our recession indicators are flashing red," warned famed Toronto economist David Rosenberg on CNBC last week.

September 11, 2024  | Premium Service  | Neither of the candidates in last night’s presidential debate spoke about the budget deficit and barely mentioned inflation. Meanwhile, underlying inflation in the US accelerated to over 3% in August, eroding arguments for a half-point rate cut by the FOMC later this month. Below is our hit on YahooFinance yesterday with Seana Smith and Brad Smith (starts at 26:30).

September 16, 2024  | Premium Service  | The Institutional Risk Analyst  has released a new report, The IRA Bank Book for Q3 2024 ( ISBN 978-0-692-09756-4) . Subscribers to the Premium Service may download the latest report below. Stand alone copies of the report are available for purchase in the IRA online store .

September 23, 2024  | Premium Service  | Below for our subscribers we provide updated thoughts on the future of the GSEs, Fannie Mae and Freddie Mac, for our presentation in New York today. We also ponder spreads and interest rates, and mortgage servicing rights (MSRs). With the mortgage industry finally slipping back into GAAP profitability after two years of carnage ℅ the FOMC, are we about to see a boom in mortgage refinance or a nothing burger?

September 25, 2024  | Premium Service  | Below for our subscribers we provide some specific thoughts on our bank, mortgage and finance surveillance groups. With consumer confidence falling the most in three years, we begin to understand the urgency behind the 50bp rate cut by the FOMC. How will the sudden shift in Fed policy impact financials? Are we headed for a recession? The chart below shows total credit card delinquency for all US banks, above pre-COVID levels and slowly climbing.

October 2, 2024  | Premium Service | With most eyes fixed on the November election, the smart money is quietly selecting the assets needed to ride the elevator up in the next reflation cycle. The FOMC is gunning liquidity in response to signs of quickening deflation in China and Europe, and stagnation in Japan. Zero growth in Germany in 2025?