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Crashing Crude Oil Prices: A Sign of Oncoming Recession?

Crude Oil in Record Setting Plunge. Just two weeks ago, a barrel of West Texas Intermediate Crude Oil (WTIC) fetched $75, a new multi-year high.  Today, that same barrel trades at just above $55, a loss of 27%.   This price collapse in Oil was the largest in that short of a time period in […]

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Asset Bubbles Start Popping as Interest Rates Surge.

Asset Bubbles Start Popping as Interest Rates Surge. It was “too good to be true” for “too long to be true”.  Nearly 38 years of falling interest rates (or RISING BOND PRICES) and a 9-year Bull Market in Equities appear to be beating a hasty retreat.  Lots of signs were there: this unprecedented period of […]

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Is The Stock Market Schizophrenic or Bi-Polar?

Is The Stock Market Schizophrenic or Bi-Polar? Yesterday, in a piece called “Stock Market Schizophrenia”  (https://markonomics101.com/2018/10/01/stock-market-schizophrenia-markonomics101/), we looked at how the markets are becoming very fractured, (between sectors). Interest rate sensitive sectors such as REAL ESTATE, Broker-Dealers, and Banks were all at, or near, LOWS.  At the same time, the Technology and Health Care sectors were […]

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Inflation: Suddenly, The Signs Are Everywhere!

Inflation: Suddenly, The Signs Are Everywhere! For what has seemed an eternity, finding tangible signs of inflation was much harder than finding the elusive “Waldo”.  Our recent piece entitled “Inflection Point (Part 5)    (https://markonomics101.com/2018/09/03/inflection-point-part-5-interest-rates-inflation-and-inflection/) looked at the amazing contradictions in the available data and raised as many questions, as answers. Suddenly, market signs of […]

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The Interest Rate Bomb: Is The Fuse Now Lit?

The Interest Rate Bomb: Is The Fuse Now Lit? Recently, we noted the critical role that higher inflation and interest rates would play in The Inflection Process.  Furthermore, the levels of interest rates seemed so low as to make very little logical sense (https://markonomics101.com/2018/09/03/inflection-point-part-5-interest-rates-inflation-and-inflection/.)  Not only does “reported” inflation (currently 2.9% annually) seem to vastly […]

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Interest Rates Continue to Edge Higher.

Interest Rates Continue to Edge Higher. Interest rates peaked in early 1980 at 20% on the Federal Funds Rate, the key short-term borrowing rate set by the Federal Reserve.  Known as the Prime Rate years ago, it reflects very short maturities.  Longer term rates, such as Five, Ten, or Thirty Year Maturities are set in […]

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Inflection Point (Part 2): Financial Assets Give Way to Hard Assets

Inflection Point (Part 2): Financial Assets Give Way to Hard Assets   Recently, we outlined the case for why equity prices may be at an historical Inflection Point (https://markonomics101.com/2018/07/12/inflection-point-part-1-the-long-term-equity-valuation-cycle/).  Both Price Earnings multiples (PEs) and Earnings themselves have very little apparent upside while being highly susceptible to a reversion to their long-run means.  Such a […]

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