Yardeni QuickTakes (Page 70)

Fed Backstops the Banks

Mar 31, 2023 2 min read

The Fed has the banks' backsides covered. The Fed can't insure deposits, but it can guarantee that the banks have access to plenty of liquidity to meet deposit outflows without having to sell securities from their bond portfolios at a loss as happened to Silicon Valley Bank (SVB), forcing it into receivership on March 10. The banks are required to put up bonds as collateral for their

Ed Yardeni

April Is Coming

Mar 30, 2023 2 min read paid

April is the second best month of the year for the stock market. From 1928 through 2022, the S&P 500 was up 1.4% on average during the month, second only to July's 1.7% average gain (chart). The S&P 500 is up 1.5% since the end of February through today (chart). That's impressive given that Silicon Valley Bank imploded on

Ed Yardeni

Yardeni Press

Mar 30, 2023 1 min read

US stocks could end this year 14% higher because banking turmoil will trigger a Fed pause, veteran investor Ed Yardeni says The S&P 500 could hit 4,600 points by the end of this year, according to Ed Yardeni. The veteran investor turmoil in the US banking sector to lead to the Federal Reserve pausing its rate hikes. "This banking crisis is going to be very well-contained,

Ed Yardeni

Chips Are Hot Despite Recession Fears

Mar 29, 2023 2 min read paid

Semiconductor investors didn't get the recession memo. They have anticipated the industry’s improvement for many months. The S&P 500 Semiconductors industry stock price index has jumped 55.8% from its late 2022 low, as of Tuesday’s close (chart). The index remains 20.9% off of its November 29, 2021 peak. As is often the case in this industry, investors jumped into semiconductor shares before

Ed Yardeni

Dr Ed's Video Webcast 3/27/23

Mar 29, 2023 1 min read paid

The recent banking crisis has heightened fears of a recession. But still the S&P 500 is up ytd—buoyed greatly by the MegaCap-8 stocks. … The SVB debacle hasn’t changed our economic outlook, which pegs the odds of a recession at a relatively high 40%, as we’re not convinced it will lead to a credit crunch that triggers a recession. Below is exclusive early access to Dr

Ed Yardeni

Bad Breadth Again

Mar 28, 2023 1 min read

The ratio of the equal-weighted to market-cap-weighted S&P 500 stock price indexes is an interesting measure of market breadth. It is available daily since 1990 (chart). Based on this limited period, we can see that the ratio tends to rise following recessions and to peak before recessions. It bottoms just before or during recessions. The same pattern seems to apply to this ratio during bull and bear markets

Ed Yardeni

A Dish of Mixed Nuts

Mar 28, 2023 1 min read paid

Today's economic indicators show that the labor market remains tight, while manufacturing activity remains weak. That mix supports our soft-landing scenario with inflation continuing to moderate and the Fed done (or almost done) tightening. Consider the following: (1) Consumer confidence. The labor market remains strong according to the March survey of consumer confidence conducted by the Conference Board. The “jobs hard to get” response remained very low at

Ed Yardeni

A Wave of Bank Mergers Ahead

Mar 27, 2023 2 min read paid

The FDIC started to do its job immediately after it seized Silicon Valley Bank (SVB). The regulator transferred all SVB deposits and assets into a new “bridge bank” to protect depositors of the failed lender. On Monday morning, March 27, the FDIC announced that First Citizens BancShares will buy SVB’s deposits and loans, just over two weeks after the biggest US banking collapse since the global financial crisis. The

Ed Yardeni

Market Call

Mar 26, 2023 2 min read

Bond investors are having fun again. The 10-year US Treasury bond yield peaked last year at 4.25% on October 24. It was down to 3.38% on Friday. Most of this decline occurred since the start of the current banking crisis on March 9 (chart). Bond investors have been waiting for something to break in the financial system since last summer when the yield curve inverted. They are betting

Ed Yardeni

The Economic Week Ahead: March 27-31

Mar 25, 2023 2 min read

More important than any economic indicators this week will be whether there is more bad news indicating that the banking crisis is far from over. No news would be good news. That's what we're rooting for. We are expecting some bad news from the March regional business surveys conducted by the Federal Reserve Banks of Dallas (Mon) and Richmond (Wed), confirming the recessionary readings of the

Ed Yardeni

DEEP DIVE: Artificial Intelligence - Everything Everywhere All At Once

Mar 24, 2023 4 min read paid

The announcements have come fast and furiously. Anyone who has anything to do with AI is broadcasting it to the world loudly. Chip manufacturers, software providers, social media companies, and the average Joe all are talking about how they’re harnessing the power of AI to work faster and smarter. This week’s news has been dominated by Nvidia’s impressive AI offerings unveiled at its software developer conference and

Ed Yardeni

What's On The Fed's Books?

Mar 23, 2023 2 min read paid

The Fed provides a weekly snapshot of its balance sheet in its statistical release H.4.1. It comes out on Thursdays. The latest one for the week ended March 22 can be compared to the one for the week ended March 8 to see how the meltdowns of Silicon Valley Bank and Signature Bank (on March 9 & 10) affected the Fed's balance sheet. The total assets

Ed Yardeni

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