Author Archives: Lenore Hawkins, Chief Macro Strategist

About Lenore Hawkins, Chief Macro Strategist

Lenore Hawkins serves as the Chief Macro Strategist for Tematica Research. With over 20 years of experience in finance, strategic planning, risk management, asset valuation and operations optimization, her focus is primarily on macroeconomic influences and identification of those long-term themes that create investing headwinds or tailwinds.
We are back to “bad-news-is-good-news” and “good-news-is-great-news”

We are back to “bad-news-is-good-news” and “good-news-is-great-news”

Thursday’s report on retail sales reasonably should have given the market at least some pause, but the market ignored the disappointing numbers and kept moving on up. The coming months and year are likely to be more challenging for investors than 2017, which is all the more reason to have solid investment strategies based on long-term themes.

The bottom line for the week is equities appear to have shrugged off the concerns from earlier in the month, 3-4 Fed hikes are increasingly likely and wage growth for much of the country remains stubbornly elusive despite the tightening labor market. We believe we have a decent grasp on what is behind the wage conundrum, but that is a topic for another day. As for what to expect from the markets in the coming weeks, we suspect that we are not out of the woods and that another retest of the recent lows is likely before moving on to make new highs.

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Inflation Rising While Wages Are Falling

Inflation Rising While Wages Are Falling

Inflation rising while hourly earnings have fallen in 5 of the past 6 months. The Fed will find it is under further pressure to hike and/or taper, which applies the brakes to any economic acceleration from tax cuts and more government spending.

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It’s Going to Take More Than a Week for the Market to Sort Itself Out

It’s Going to Take More Than a Week for the Market to Sort Itself Out

As gut-wrenching as last week was for many folks, the reality is it’s going to take some time for things to sort themselves out. Investors should certainly be getting ready with their shopping list of what they’d like to add to their portfolio and at what price it becomes attractive so they are ready to act when those price points arrive, but the reality is we’re probably not quite there yet.

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SNAP BACK TO REALITY: Bond yields deliver a long-awaited blow to equities

SNAP BACK TO REALITY: Bond yields deliver a long-awaited blow to equities

Well, this week was something different! Richly priced equities took it on the chin. The culprit? Rising interest rates, which increase borrowing costs in an economy that is once again heavily indebted across the board at a time when the Fed is reducing its balance sheet, thus hitting the bond market from both sides – weaker demand and extra supply. Add in record high corporate debt and ballooning consumer credit card debt and you have yourself one painful debt-fueled headwind.

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It’s Still Rock & Roll: As the Dollar Gets Rocked, Equities Continue to Roll

It’s Still Rock & Roll: As the Dollar Gets Rocked, Equities Continue to Roll

The economy and the markets aren’t the same thing and can diverge. Case in point, much of the current bull market has occurred during the weakest economic recovery in history. Now the markets are exultant to see an improving economic picture in much of the world, forgetting that we are already in a market that is hot, hot, hot! At the same time, we’re seeing the dollar plummet — great news for U.S. based companies with an international footprint but can have an impact on investors who see their gains negatively impacted. Is this the catalyst the market is looking for to spark a turnaround?

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2018 poised to be a much more interesting year than many are expecting

2018 poised to be a much more interesting year than many are expecting

With the market tear continuing, making new high after new high, while at the same time the dollar just experienced its fifth straight week of declines, we suspect 2018 is going to be a more interesting year than many are prepared to experience. And we aren’t even talking about tax reform related spending and investment assumptions. Instead in this weeks edition of the Weekly Wrap we digest the new data around wages, employment, savings, bond yields and household net worth. All the fun stuff to get you pumped for the weekend!

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Weekly Wrap: Retail Spending Figures Have the Financial Media Giddy, 
But Just How Strong is the Consumer?

Weekly Wrap: Retail Spending Figures Have the Financial Media Giddy, 
But Just How Strong is the Consumer?

We continue to see signs of modest economic improvement, but when it comes to households in the U.S., improvements are not broadly shared. We are seeing signs of inflationary pressures in producer prices, but little in terms of wage price pressures. On the consumer side, the great deflationary force that is online and mobile consumer shopping continues to overpower any potential inflationary pressures. The push-pull of these dynamics bodes well for companies that are riding the tailwind of our Connected Society investing theme, while addressing pain points being felt by Cash-Strapped Consumers.

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