During a period of just over three months, the Nasdaq 100 not only recovered from a …
Please try again later. With the Fed directly supporting corporations, shareholders are being shielded from risks related to declining sales and bankruptcy. Recall that a company’s weight in the S&P 500 is determined by its market cap. You also have the option to opt-out of these cookies. The money supply roughly includes … A company’s market capitalization is calculated as its current stock price multiplied by its total number of outstanding shares. As the chart below reveals, ballooning cash balances, principally from higher income individuals, are, at least partially, being recycled by the banks. Our coverage consists of equities, ETFs, futures, forex, bonds, mutual funds and economic data. It has become evident over the last few months that the stock market and the economy can dance to very different tunes. The chart below shows the rapid increase in total US money balances: –Monitoring the quantity of money in an economic system is important because In the current environment, with unemployment surging – in the US it reached 14.7% in April – and expectations of an imminent end to the generous welfare of the past few months, individuals and households, which can afford to choose, have chosen to save rather than spend their state-decreed windfall. At some point in the near future they may need to make a swift withdrawal: –Rising global uncertainty has seen the velocity of money collapse further; nonetheless, lower interest rates and lower bond yields both favour stocks. To help us understand why this may be the case, this infographic charts the University of Michigan’s Index of Consumer Sentiment against the S&P 500, before diving into potential underlying factors for their divergence. Here are a few observations: –With US unemployment hitting levels not seen since the Great Depression and the harmonised OECD average at its highest in two decades, it seems unlikely that consumer spending will rebound too rapidly. Global Money Supply Growth and the Great Inflation Getaway by It has become evident over the last few months that the stock market and the economy can dance to very different tunes.
This means that certain sectors can form a larger part of the index than others. M1 includes currency i.e. Within IT, we can highlight the FAANGM subset of stocks, which include some of America’s These companies have grown rapidly over the past decade, and continue to perform strongly during the pandemic. The results are patently evident in the money supply data: –Necessary cookies are absolutely essential for the website to function properly.
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