We know in the Pacific Northwest, rain is a fact of life, more so in the winter and spring than in the summer, it does rain in the summer but that is not the normal day. A normal summer gives us lots of sun with rain occasionally, whereas winter supplies us with lots of clouds and rain and bits of sun. Over a full summer we are not disappointed over the amount of sun we get, this is the “long-term”, and this is climate.
Read MoreAfter a brief hiatus, we return following a week with few economic and market reports. That is not to say that the week was without news, most notably when Fed Chair Jerome Powell spoke Thursday and spooked the markets with the comment that the Fed is a long way from done in its fight against inflation.
Read MoreInflation is the driving force behind the rate increases that the Federal Reserve has presented since March 2022. Inflation peaked in summer 2022, and it has been cut by more than half since the Fed raised rates from the range of 0.0%-0.25% to the range of 5.25%-5.5%, a more than 20-fold increase.
Read MoreThe Federal Reserve has increased its overnight target rate 5.25% since March 2022. Rate increases this fast and large would, by most thinking, quickly slow the economy.
Read MoreOctober has the reputation as a terror for the capital markets. October 1929 is seen as the start of the bear market of the Great Depression. October 1987 holds the record for the largest single day plunge when the market fell more than 22%. Leading into October this year, there were reasons to believe we could see a return of the October Terrors.
Read MoreLast week’s economic reports were highlighted by Friday’s personal consumption expenditures report. This report showed consumer spending remained strong, but inflation, excluding food and energy, was below expectations. Also released last week was the final estimate for second quarter gross domestic product growth and initial jobless claims, both below expectations.
Read MoreEconomic forecasts are known to be wrong most of the time. Even the best forecasters suffer through periods of incorrect predictions. There are many reasons why this is the case. Sometimes the forecaster does not include needed data, a surprise event, either positive or negative, could move the economy away from the expected path and overconfidence of the forecaster.
Read MoreEconomic reports that were published last week gave us a glimpse of the health of the economy and maybe an indication of what the Fed will do at their meeting this week. Both consumer and business reports suggest the economy is performing better than expected. On the other hand, inflation exceeded expectations, which is not a positive for the outlook. In total, though, the reports painted an optimistic picture of the economy.
Read MoreOn August 1, Fitch Ratings downgraded the U.S.’s long-term default rating to AA+ from AAA. Fitch cited an “expected deterioration over the next three years”, a high and growing debt burden, and the erosion of governance relative to ‘AA’ and ‘AAA’ rated peers over the last two decades.
Read MoreIn August, Allen Trust Company celebrated in our beautiful, newly redecorated Vancouver, Washington office, located downtown right across from Esther Short Park. During the event and later online, many mentioned their appreciation for our decision to open a new location in The ‘Couv – a trend for Oregonians these days for many reasons.
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