May 23, 2019 – Financial system stress comprises an important set of variables that we continually track. While not always indicative of where or when the next recession will start, we do believe it helps us find pockets of the market that may be more prone to breaking down. Importantly, the Federal Reserve now produces a biannual study, named the “Financial Stability Report,” and its second issue was released two weeks ago.
May 22, 2019 – While 2018 was a notable year for growth in the economy, with GDP expanding at a solid pace of 2.9%, it was also notable for the lack of growth coming from the housing sector. After making modest positive contributions to annual GDP growth in each year of the recovery since 2012, investment in the housing sector by businesses and households (known as residential investment in the GDP accounts) was nearly flat in 2018 (Figure 1).
May 21, 2019 – On May 23-26, elections will be held across the 28-nation European Union (EU) for the 751-seat European Parliament (EP). Campaigning has been vigorous in recent weeks, particularly by right-wing Eurosceptic nationalist candidates. Nevertheless, we expect pro-EU centrist candidates to prevail and that the outcome will be favorable for Europe’s long-term investment climate.