Economics

The frequency of calls that the market is in a euphoric bubble is increasing. It’s worth exploring some of the evidence used to reach that conclusion before deciding whether now is the time to adopt a more cautious stance and to ready oneself for the benefits lower prices deliver.   continue…

by Roger Montgomery Posted in Economics.

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The monthly household spending indicator released by the Australian Bureau of Statistics (ABS) last week, is an additional data point crucial to the Reserve Bank of Australia’s (RBA’s) ongoing monitoring and decision making. Household spending was 3.6 per cent higher than this time last year. This follows a slight dip we saw in December 2023. The ABS reported a 1.2 per cent increase in December 2023 and 2.9 per cent increase in January 2024.   continue…

by Brett Craig Posted in Aura Group, Economics.

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In this week’s video insight, I explore the equity market’s outlook, stressing the balance between disinflation and positive growth against the backdrop of potential inflation and economic slowdowns. Market dips, while concerning, are seen as opportunities, especially in smaller companies, provided inflation or recession risks don’t materialize. I highlight the significant role of the U.S. Federal Reserve and central banks in shaping expectations through interest rate policies. Recent shifts in market sentiment, driven by economic data and Fed caution, illustrate the challenge of forecasting amidst these uncertainties. continue…

by Roger Montgomery Posted in Economics, Video Insights.

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The S&P500 is up 10 per cent in the first quarter of calendar 2024. Another useless fact is that the S&P 500’s rally set 22 new records in 2024 alone, and its market value has grown by over U.S.$9 trillion since late October. 

It’s worth reflecting on our prediction from last year that innovative growth stocks would outperform mega-cap tech stocks in 2024 as investors broadened their risk appetite to include small caps.  continue…

by Roger Montgomery Posted in Companies, Economics.

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The Australian Bureau of Statistics (ABS) last week, released the monthly Consumer Price Index (CPI) figures for February. The consumer price index is a measure of inflation published by the Australian Bureau of Statistics. The monthly CPI read came in at 3.4 per cent in the 12 months to February 2024. The rate has now remained unchanged for three consecutive months. When excluding the volatile items, which included fuel, fruit and vegetables, and holiday travel, the CPI level was 3.9 per cent. This is a downward revision from the 4.1 per cent reported in January.  continue…

by Brett Craig Posted in Aura Group, Economics, Editor's Pick.

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The week of March 18, 2024 marked a significant legislative move as the U.S. House of Representatives endorsed a bill mandating the separation of TikTok from any affiliations with the Chinese government. The endorsement received substantial bipartisan support, with 90 per cent of Republicans and 75 per cent of Democrats voting in favour.  continue…

by Roger Montgomery Posted in Companies, Economics.

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The Reserve Bank of Australia (RBA) board left the cash rate on hold at 4.35 per cent last week, in line with market expectations. The decision was made off the basis that “inflation continues to moderate, but remains high.” continue…

by Brett Craig Posted in Aura Group, Economics.

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I was very lucky to attend the Harvard Business School Owner/ Presidents Management program over the three years to 2006. In my class of 100 mature–age students, around half were from the U.S., and the remainder were from several other countries. I know it is a gross generalisation, but it would be fair to say the U.S. students excelled at any “marketing” related case studies but noticeably under-performed in any case studies related to “accounting”.  continue…

by David Buckland Posted in Economics, Foreign Currency.

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The latest e-commerce report from Australia Post simultaneously reinforces what we know about the ineffectiveness of monetary policy and recent Commonwealth Bank household spending insights reports. 

The headline data from Australia Post reveals Australians reduced their online spending by 1.2 per cent in calendar year 2023, compared to the year before, to $63.6 billion.  continue…

by Roger Montgomery Posted in Economics.

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In this week’s video insight, I discuss the Reserve Bank of Australia’s (RBA) recent decision to maintain current interest rate levels and anticipate the upcoming announcement from the U.S. Federal Reserve (Fed), where no changes are expected. Instead, the focus shifts onto potential indicators regarding future rate cuts. With recent market shifts and economic data influencing expectations, I delve into the broader implications for investors, highlighting the importance of maintaining a long-term perspective amidst short-term economic and financial fluctuations. 
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by Roger Montgomery Posted in Economics, Video Insights.

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