Insights on markets, emergent trends, history, innovation, risk management, global economics, strategy, policy, and other topics that catch our attention. Inspired by ongoing research, conversations and events. Written and edited by Osbon Capital Management and published every Thursday morning.
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2024 will bring more positive novel surprises. New years always do. In 2023, it was the dramatic acceleration in AI, which touches nearly every industry, and the early stages of an answer to the obesity epidemic with GLP-1s. Here is a list of what’s on our minds going into 2024.
Treasuries, Patience, Bits
Treasuries Treasury yields are drawing attention now that they yield between a 2-4% risk-free rate of return. Treasury Bills (TBills) are liquid and commonly used by financial professionals, but most people are only vaguely familiar with what they are and how they work. For example, Warren Buffett keeps Berkshire Hathaway’s cash in T-Bills. We last used TBills in 2018, when…
The Fed, Lithium, Merge
The Fed As expected, the Fed raised rates yesterday by .75% to bring the Fed Funds rate to its highest since 2007. As of now, futures markets expect another .75% hike in November to bring the rate to 4% and a peak of 4.75% by March 2023. Commodity prices continue to fall, which will help bring down inflation numbers. Many…
Inflation and Aftershocks
Notes on Inflation Next week brings the Sept 21st Fed rate hike, which is expected to be 75bps. Former Secretary of the Treasury Larry Summers has been outspoken about the reasons for a 100bps hike, namely that we need to be more aggressive because inflation changes are reacting too slowly, if at all. Either way, this next hike brings the…
The Dollar, Population and Productivity
The Dollar The US dollar has soared in value recently to a multi-decade peak. The Euro is at parity for the first time in twenty years and the British Pound is getting closer to parity, something that happened only once for a very brief period in the 80’s. There are big shifts happening in all markets, and the currency market…
The Fed, DNA Sequencing, More AI Developments
Don’t Fight The Fed It’s an important time to practice investment patience. September brings another CPI release (Sept 13) followed by a Fed rate decision (Sept 21). The Fed has said many times they will continue to tighten until the inflation rate comes down. For now, we can get an early peek at the inflation numbers that will arrive at…
Inflation Update, Realistic Energy Transition, Stablecoins
Inflation Update The next Fed rate hike on September 21 depends on inflation metrics. One place to get an early peek at inflation is in commodity markets movements: Gasoline is down -35% from its peak in June, but still up y/y. Oil is down -20% from the high in June but still up 40% over the past year. Lumber, one…
Inflation, Pivots, XPrize
Inflation Last week we wrote about five key economic dates to keep a close eye on. The first, yesterday’s CPI inflation print, did not disappoint. Year over year, CPI inflation ticked down from 9.1% to 8.5%, and the monthly inflation was flat. About a month ago, we wrote about commodity market prices like oil, copper, wheat and corn falling roughly…
The Budget, Key Dates, Recession
Important Dates Ahead The Fed has said its actions will be data-dependent. We will all be watching closely when the next two (CPI) Consumer Price Index readings come out as well as the next (PCE) Personal Consumption Expenditure Index results. The PCE is a Fed favorite because they feel it is a more accurate representation of inflation. The next Fed…
Apple Health, Sentiment, Chips
Apple’s Convergence Device – Health One of the amazing things about software is that it gives engineers near infinite creation and creativity abilities. In particular, the iPhone is an excellent playground for testing new products and features because we carry it everywhere we go, it’s always on, and it’s full of useful sensors that can be used to record the…
