Investment Insights are written by Angeles' CIO Michael Rosen
Michael has more than 30 years experience as an institutional portfolio manager, investment strategist, trader and academic.
Normally, I wouldn’t comment on any single economic release, but today’s GDP revision adds to the mounting evidence of a strengthening US economy. GDP growth in the third quarter was revised up to 5.0%, the fastest annualized pace since 2003 (see graph below).
This was not a case where the headline misled: all of the underlying components (except net exports) were revised higher. Corporate profits as a percentage of GDP reached a record high (see graph below). Following a 2% decline in output in the first quarter of the year, the economy racked up gains of 4.6% and now 5%.
GDP growth will likely slow from here (the economy is tracking around 3% growth in the fourth quarter). The decline in the price of oil is not a harbinger of imminent recession or of impending deflation. The economy is growing a little faster, inflation pressures are not yet evident, monetary conditions remain accommodative. Santa is being generous this year, and we are grateful.
Two weeks ago (13 August, No Panic (Yet)) I noted that the renminbi devaluation was officially described as a modest ...READ MORE
Ursa Minor 10-02-2015
The bears are stirring. Not yet rampaging, but there's a lot of red ink across most markets.Today's jobs report was ...READ MORE
Europe Falling 10-22-2014
Yes, pessimism over Europe's prospects is high, and valuations in Europe are relatively low. But both for good ...READ MORE