Article Category: Psychology

Matt’s Market Insights

This week will be data-heavy as investors navigate an initial reading on Q2 GDP, the monthly jobs report, an FOMC meeting, and continued corporate earnings.

With the July jobs report on deck for Friday, I wanted to highlight some statistics published in a WSJ article written by Mortimer Zuckerman (thanks to subscriber John D. for the link). In his article, Zuckerman breaks down the most recent jobs report and provides some context to the headline figures.


Read more  

Posted in: Earnings Economy Psychology

Matt’s Market Insights

Ahh ... supply and demand, the two magical forces that free market capitalists hang their hat on. Conventional economics would tell us that the price of any asset is a function of supply and demand, and is typically set at the intersection of these two curves, see below. This relationship generally holds in the long-run, but short-term pricing has another component. You can call it psychology, emotions, or fear, whatever you like. In the short-run this intangible component can have a much larger impact on price than either supply or demand.


Read more  

Posted in: Economy Federal Reserve Interest Rates Oil Psychology

Matt’s Market Insights

There is nothing like central bank easing to get investors flocking to equities. As expected the ECB moved on Thursday to cut interest rates and also announced additional stimulus measures. The ECB's main lending rate was reduced from 0.25% to 0.15%, and they also introduced a negative deposit rate on cash that banks have parked with the central bank. The goal is to incentivize more bank lending, aka. increase the money supply. The ECB also alluded to preparations for direct purchases of loans and made clear that the door remained open for additional measures to come if needed.


Read more  

Posted in: Bonds Gold Inflation Interest Rates Momentum Psychology

Matt’s Market Insights

China and Russia just signed a huge natural gas deal that has been in the works for nearly a decade. The 30-year agreement will provide China with over $400 billion dollars worth of natural gas. This deal comes at an interesting time considering the situation in Ukraine. As events unfold, the European Union has been trying to find alternative sources of gas in anticipation of the Ukraine crisis causing supply disruptions. Nearly a third of Europe's natural gas comes from Russia, with about half of that traveling through Ukraine.


Read more  

Posted in: Bonds Economy Interest Rates Momentum Psychology

Matt’s Market Insights

There is a natural tendency to become more and more suspect of a bull market as its price levels and duration increase. We're now in the early stages of the 6th year of this bull market, a market which is already the fourth longest in nearly 100 years. Many tops have been called along the way but we have continued higher, either to the dismay of those watching or the delight of those participating.


Read more  

Posted in: Earnings Psychology

Back to top