Is the Snap Back in Rates Really that Surprising?

The post-Fed action in the bond market yesterday was impressive, yet left some begging for answers. If the Fed raised short rates yesterday and reiterated its plans for the subsequent five rate increases through 2018, shouldn’t the long-end be selling off? If it were only that easy. The bond market has several headwinds that are […]

Q&A with Peter Zeihan, Part 2: Three New Wars

Absent Superpower

We recently met with geopolitical strategist Peter Zeihan to discuss world events since the American election and his new book, “The Absent Superpower: The Shale Revolution and a World without America.” In the book, Peter credits energy and resource innovations with reshaping the global geopolitical environment. We covered so much ground in our visit with […]

Hot Air Balloon Economy

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The interplay between debt and income can be a difficult thing to understand. Here is a useful analogy. Imagine a hot air balloon lying on the ground preparing for take-off. The fuel tank, used to heat the air, is the balance sheet in this analogy while the loft of the balloon is the income statement. […]

A Massive Liquidity Illusion

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Since the election we’ve heard the rally in stocks characterized as a “Trump Trade” or a “reflation” trade. We think there is a really important element missing from this analysis that could change very quickly over the next several weeks. On March 16, 2017 (the day after the Federal Reserve is expected to raise interest […]

Putting the Snap IPO into Historical Context

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The Snap IPO has garnered a fair amount of coverage over the last two days so we thought we’d put some data behind the phenomenon. The most striking thing about the Snap IPO is clearly the valuation. Snap doesn’t have any earnings, but it does have a modicum of sales. After two days of trading […]

Q&A with Author Peter Zeihan: How Shale is Reshaping America and the World

Absent Superpower

We recently met with geopolitical strategist Peter Zeihan to discuss world events since the American election and his new book, “The Absent Superpower,” released last month. In the book, Peter credits energy and resource innovations with reshaping the global geopolitical environment. He predicts by 2019, US oil production costs could drop to $25 per barrel, […]

Why Hitting 2% Real GDP Growth Is Key For US Corporate Profits

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While the myth that stock market returns are highly correlated to a country’s GDP growth rate has largely been debunked, there remains a strong, and intuitive, relationship between corporate profits and GDP. GDP measures the output of an economy and corporate profits are simply the income to capital owners derived from that output (with some accounting adjustments made along the […]