The Commodities Channel

Home Prices Rose 6.2% Year-over-Year in September

With today's release of the September S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index were up 0.5% month over month. The seasonally adjusted national index year-over-year change has hovered between 4.2% and 6.2% for the last thirty months. Today's S&P/Case-Shiller National Home Price Index (nominal) reached another new high.

Weekly Gasoline Price Update: WTIC Jumps 3%

It's time again for our weekly gasoline update based on data from the Energy Information Administration (EIA). The price of Regular and Premium were down four and nine cents, respectively, from last week. According to GasBuddy.com, Alaska has the highest average price for Regular at $3.21 and San Francisco, CA is the most expensive city, averaging $3.28. Alabama has the cheapest at $2.22. The WTIC end of day spot price closed at 58.11, a 3.0% increase from this time last week.

On My Radar: Trade Signals Remain Risk On

Happy Thanksgiving to you and your wonderful family. Today’s post is holiday short because by the time it hits your in box I’ll hopefully be home with IPA in hand celebrating a hard-fought Black Friday golf tournament victory. Daughter, Brianna; son, Matthew and good friend, Stevie Oh, rounds out our foursome. If you are familiar with golf, it’s a scramble format where each player tees off.

From Reflation to Inflation

The U.S. economy is shifting from reflation to inflation – and we have greater confidence in inflation returning to its medium-term trend and the Federal Reserve’s target. Better wage growth and potential fiscal stimulus should cement this transition.

The Flattening Yield Curve Is Not A Threat to US Equities

On its own, a flattening yield curve is not an imminent threat to US equities. Under similar circumstances over the past 40 years, the S&P has continued to rise and a recession has been a year or more in the future. Investors should expect the yield curve to flatten further in the months ahead.

Gobble, Gobble: Thanksgiving Dinners Stuffed with Savings Despite Rising Fuel Costs

A helpful way to look at inflation is the changing cost of a typical Thanksgiving dinner for 10 people. For the second straight year, the cost actually declined from the previous year’s holiday, according to the American Farm Bureau Federation (AFBF). This year’s feast, including staples such as turkey, rolls, sweet potatoes and more, fell $0.75 to a five-year low of $49.12. On an inflation-adjusted basis, that’s down more than $10 from 30 years ago. The turkey alone cost about 1.6 percent less than last year.

Things We Are Thankful For

We’re thankful for this year’s economic growth in the U.S., which has exceeded most expectations. A soft first quarter has been followed by two quarters in which real activity expanded at an annual pace exceeding 3%.

Where Might Credit Risks Exist? Follow the Supply

In 2017, corporate credit, including high yield, saw a resurgence in interest within a longer-term trend of increasing supply. In recent weeks, however, it has shown some cracks.

The Upside of Unintended Consequences

There could always be an exogenous event like military conflict with North Korea, strife in the Middle East that cuts off oil flow or Russian aggression in the Baltics that unsettles markets. The market is assuming none of that will happen, and if the market is right, we have at least one to two years to go before we get into serious trouble. My overall conclusion is that there are significant investment opportunities outside the United States and many portfolio managers are under-weighted globally.

The "Real" Goods on the October Durable Goods Data

Earlier today the Census Bureau posted the Advance Report on Durable Goods New Orders. This series dates from 1992 and is not adjusted for either population growth or inflation. Let's now review Durable Goods data with two adjustments.

Jeremy Siegel: The S&P 500 is Fairly Valued

The bull market in U.S. equities is behind us, according to Wharton professor Jeremy Siegel, who says that the S&P 500 is now “fairly priced.”

Chicago Fed: Growth Up in October

"Index points to a pickup in economic growth in October." This is the headline for today's release of the Chicago Fed's National Activity Index, and here is the opening paragraph from the report: "Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) rose to +0.65 in October from +0.36 in September."

Time to Trim, but Not Abandon Gold

Gold has performed surprisingly well this year. Russ discusses why that might not be the case going forward, and it may be time to pare positions.

On My Radar: A Fatal Attraction for the Slim Chance

My daughter, Brianna, and I were recently listening to a Charlie Rose interview on Bloomberg Radio. I love the way he asks direct questions. The interview featured Jeremiah Tower, a little-known chef who pioneered a restaurant revolution in the 1970s that gave rise to the culinary style known as “California Cuisine.”

Synchronized Global Growth May Have Arrived

Nearly 10 years after the financial crisis brought the global economy to its knees, conditions have finally improved enough to crystallize my conviction that synchronized global growth is currently underway. Revenue and earnings growth are up year-over-year, not just in the U.S. but worldwide. Despite President Donald Trump threatening to raise tariffs and tear up trade deals, global trade is accelerating. World manufacturing activity expanded to a 78-month high of 53.5 in October, with faster rates recorded in new orders, exports, employment and input prices.