Weekly Market Snapshot from Frazier Allen for the week of February 20th, 2013
February 20, 2013
Market Commentary by Scott J. Brown, Ph.D., Chief Economist
In his State of the Union Address, President Obama proposed various efforts to boost manufacturing jobs, universal pre-K education and an increase in the minimum wage. However, there’s little chance that any of these proposals will make it to the floor of the House.
The economic data were mixed. Retail sales rose a modest 0.1% in January. Industrial production slipped 0.1%, but figures for November and December were revised higher. The New York Fed’s Empire State Manufacturing Index and the mid-February reading on consumer sentiment surprised to the upside. [Read more]
Weekly Market Snapshot from Frazier Allen for the week of February 10th, 2013
February 10, 2013
Market Commentary by Scott J. Brown, Ph.D., Chief Economist
Federal Reserve Governor Jeremy Stein fell short of declaring that credit markets are overheating, but suggested that an extended period of low interest rates could lead to the taking on of greater duration of credit risks, or to employment of greater leverage in a “reach for yield.” He said that the Fed must monitor the financial markets closely and could address signs of excessive risk-taking through regulatory efforts or through monetary policy.
Next week, President Barack Obama will deliver his State of the Union Address on Tuesday evening (which is also Mardi Gras). Most likely, the President will ask that Congress postpone the sequester through the end of the year. Note that it’s not costless to do so – there has to be an offsetting increase in revenues (possibly closed loopholes) or reduction in other types of spending (say, reduced farm subsidies). The reports on retail sales and industrial production have some market-moving potential, but seasonal adjustment could exaggerate what would otherwise be minor shifts in the data. [Read more]
Update on U.S Debt Ceiling and Possible Credit Downgrades
July 25, 2011
Chances are you’ve heard about the ongoing debate surrounding raising the U.S. debt ceiling and even more recently about Moody’s announcement that it could potentially downgrade its credit rating for U.S. Treasuries and other institutions linked to the U.S. government.
On top of that, Standard & Poor’s placed the U.S. on “CreditWatch Negative” based on the rising risk of a policy stalemate. The agencies themselves believe the risk of any payment default by the U.S. government is low, but increasing slightly. [Read more]
