Join Michael Cembalest as he explores a wide variety of investment topics, including the economy, policy and markets.
Biden goes for broke on growth, driving coincident and leading indicators to all-time highs; the Value recovery and where it goes from here; COVID herd immunity, the path to normalcy and rising concerns about thrombosis risks from vector vaccines.
Interest rate pretzels and the Zoom shock on real estate
If long-term US interest rates stay below 2%, that’s a great sign for equity investors. But if they don’t… it’s amazing to see the pretzels that people contort into to convince themselves that rising rates are not a problem for equities. Also: an early look at the Zoom shock on commercial and residential real estate, and the diverging COVID trends in the US vs Europe.
Very short stories
Short stories on the global recovery, plummeting COVID infections, Larry Summers & the bond market, SPAC sponsors, renewable energy, the Texas power outage and the battle for the Republican Party.
In this month’s note, we look first at the SPAC capital raising boom. Our main focus: returns to date for SPAC sponsors and investors, and the large wealth transfers taking place among SPAC participants. Second topic: Biden’s early stage energy policies (ban on new oil & gas leases on Federal lands, Keystone XL pipeline termination and conversion of Federal fleet to EVs) will probably end up increasing US oil & gas imports more than they reduce emissions.
Fear of Flying
Equity markets are flying. So is COVID. So are corporate reactions to Congressional objectors.
Outlook 2021: The Hazmat Recovery
Michael Cembalest’s views on what will drive markets and the economy in 2021, as well as the challenges we face that stimulus and vaccines can’t solve.