The Dividend Cafe

Today's Post - https://bahnsen.co/3NJs88A One of my least favorite things I see analysts do on Wall Street is take various historical incidents and attempt to extract likely future market behavior from it. “7 out of the last 9 times a team from California won the World Series, the market was up over the next 120 days” (or something like that – I made that one up to make a point; actually, that exa...

Today's Post - https://bahnsen.co/3ricXf2 I am hopeful all had a wonderful Independence Day spent with family and friends in celebration of the 247th year of the greatest country to ever inhabit the Earth.  The biggest news on the day was the Fed minutes that were released, indicating the rationale behind their decision to pause and hold rates steady last meeting while leaving the door open to rai...

Today's Post - https://bahnsen.co/3JFT7AK By the time you are reading this, the first half of 2023 will be complete.  I can't put exact market figures here because I am writing this middle of the market day, Thursday the 29th, so the precise finality is a day and a half away.  But the general themes that made the first half of 2023 what it was are quite clear, and I think you will find this "2023...

Today's Post - https://bahnsen.co/3prCOAq An upward revision in Q1 GDP fueled by stronger consumer spending and exports, jobless claims figures that came in better than expected, and a passing grade for all US banks in Fed stress test results were what fueled today’s market rally and run-up in short-term rates. Links mentioned in this episode: TheDCToday.com DividendCafe.com TheBahnsenGroup.com

Today's Post - https://bahnsen.co/3XrRlJ6 At the ECB Forum in Sintra Portugal – Powell, Lagarde, and Baily all had hawkish comments on inflation and tighter central bank policy needed to contain it. However, all three felt that could be done without inevitably causing a recession. Links mentioned in this episode: TheDCToday.com DividendCafe.com TheBahnsenGroup.com

Today's Post - https://bahnsen.co/3pr9HgK So another day gone by and I don’t think the world knows much more than it has 24 hours ago about Putin and the weekend coup threat. Natural gas prices have jumped from $2 to $2.80 BTU in just 15 days or so (+40%) and not surprisingly energy stocks with a natural gas focus have done much better than those exclusively focused on crude oil. One of the energy...

Today's Post - https://bahnsen.co/3NMJ3bk Top News Stories Friday night the absolutely fascinating news hit that a coup d’etat was underway in Russia, or at least an attempted one, with mercenary chief, Yevgeny Prigozhin, leading troops out of Ukraine and into a city south of Moscow with significant military headquarters for Russia. Putin, of course, called the act a treasonous betrayal and vowed...

Today's Post - https://bahnsen.co/3CKX1o6 I gave a speech this week at a large economic symposium where I am blessed to lecture every summer. My talk tackled many of the themes I write about all the time in the Dividend Cafe – the impact of excessive indebtedness on macroeconomic conditions, the comparison of pre-GFC Japan with post-GFC America, the diminishing return of fiscal and monetary policy...

Today's Post - https://bahnsen.co/3NqpaFA The Bank of England surprised markets by hiking rates a half point this morning (a quarter point had been expected). Chairman Powell did his very best in front of the House yesterday to basically swear they have more rate hikes left in them (all the while swearing they are data dependent, with the apparent contradiction between promising something six week...

Today's Post - https://bahnsen.co/3JpMzpy Brian Szytel here with you today, kicking off the first day of Summer with just what I know you all used to look forward to as kids – discussion on the days market action, Fed comments, and inflation. Not to worry, I won’t let you hit your Summer vacations uniformed with all thoroughly discussed in today’s podcast and video. Links mentioned in this episode...

Today's Post - https://bahnsen.co/3JpIamG Greetings from Grand Rapids, Michigan where I spoke at a large economics symposium today, and where I will be for the next couple of days before returning to NYC on Friday. As is my intention on most weeks with a Monday market holiday, this Tuesday DC Today is basically being done with the old school “Monday style.” Links mentioned in this episode: TheDCTo...

Today's Post - https://bahnsen.co/4301I8h We have had a lot to say about housing here in the Dividend Cafe over the years, most recently here with a broad update of projections for supply, demand, and pricing, and more philosophically, last year’s bulletin here that aimed to provide a bigger picture perspective on how to think about it all. I was and am proud of both issues of the Dividend Cafe an...

Today's Post - https://bahnsen.co/42KWXyW Markets rallied some more today as bond yields dropped further even though the curve inverted more (as long-dated yields dropped more than short-dated). The odds for a hike at the next meeting (which is six weeks away, I should point out) moved to 67% for a 25-basis point hike and 33% for no move again. Odds are evenly split that by the end of the year we...

Today's Post - https://bahnsen.co/467JeWa Brian Szytel here with you on today’s highly anticipated Fed Day. After 10 back-to-back rate increases from the Fed over the past year and a half where they raised short-term rates from 0% to just over 5% the Fed today paused (not necessarily ended) their rate tightening campaign with a ‘wait and see’ message on how their policy changes which operate with...

Today's Post - https://bahnsen.co/3N5Vy0n So the month of May CPI report came out this morning, and xxxxxxx Those who continue to be “frustrated” by the reasonable resilience of the economy in the face of the Fed’s desire to break it are up against a few different things. (1) The utter weirdness of believing an economy must be broken to beat inflation. It is not true, and it has never been true. (...

Today's Post - https://bahnsen.co/3N1hlWQ Futures opened flat last night and stayed flat throughout the night up until my early morning wake-up. They inched higher in the hours before the opening. The market opened up over +100 points and stayed up through most of the day, closing near a high The Dow closed up +190 points (+0.56%) with the S&P 500 up +0.94% and the Nasdaq +1.53%. There are now...

Today's Post - https://bahnsen.co/42yYfgC This was a big week in the Bahnsen household, but really for many families all over the country. Joleen and I celebrated the graduation from high school of our firstborn son, Mitchell. Many of you likely had kids, grandkids, and loved ones celebrate some graduation as well (college or high school). They are all special and memorable, and if you suffer from...

Today's Post - https://bahnsen.co/3WZi5jG It has not been a great week for global bonds with extra rate hikes as of late in Canada and Australia as of late and a re-pricing of Fed expectations here in the U.S. has kept bond yields on the short end of the curve higher, and even flattened the curve a tad with longer-dated yields coming up. We are still sitting at just a 74% chance of a pause in Fed...

Today's Post - https://bahnsen.co/3Joqzf1 Big rally in Energy and Real Estate today even as other markets stalled and reversed. The media world went into a trance this morning before the market opened on the news that CNN’s CEO, Chris Licht, had been fired. Though not much of a market story, it distracted everyone for the day and allowed it to be a mostly boring day in the world of financial media...

Today's Post - https://bahnsen.co/3X7RBwR A flattish day in markets but a big rally in Financials … The SEC is suing Coinbase, the major publicly traded exchange for cryptocurrency, for violating securities laws and defying regulatory requirements. This company is down -80% in value from its high, and now there exists an investigation or active charges with every major crypto exchange firm. Links...

Today's Post - https://bahnsen.co/3qnOZyl Ask David “With regards to the debt ceiling compromise, you point out that it suspends the debt ceiling entirely through the end of 2024. What I do not exactly understand is if the spending growth has been capped, then why would an increase in the debt ceiling be needed at all? ~ Mark The part you’re missing is revenue. We can reasonably know what expenses...

Today's Post - https://bahnsen.co/3qmaIH8 For a long time there was only one country on earth dealing with a bubble that had burst, spending way more than it was bringing in, seeing revenues decrease, juggling banks that weren’t actually solvent, and running extreme monetary policy to try and keep all the holes in the dam from bursting. That country was Japan in the 1990’s and into the next decade...

Today's Post - https://bahnsen.co/3C3vY77 As expected, the House passed the McCarthy-Biden debt ceiling bill, and the Senate will do their part by this weekend. The bill passed by a vote of 314-117, quite the nail-biter, with 165 Democrats voting yes and 149 Republicans voting yes. This allows us to now change our focus to the next end-of-the-world moment. Do not fear – it will not take long – a n...

Today's Post - The debt ceiling bill has gotten through the House Rules Committee and it appears nearly certain that the House will have the votes tonight for passage. What happened here proved to be even less dramatic than I predicted, and I was predicting that the media posture here was recklessly and shamefully melodramatic. I promise you this, though – no one will learn anything, and everyone...

Today's Post - https://bahnsen.co/3qlozNA “I agree with you overall concerning shareholder vs. stakeholder priorities in a company’s motivations. It did occur to me, however, that often the bad behavior examples provided by the advocates of the stakeholder paradigm don’t really involve a company acting in the best interests of shareholders, but rather having a near-sighted, excessively short-term...