ecnfin

Structural Wage Stagnation Causes Economic Weakness

July 21, 2018 by Ivan V. Sichkar

The US economy has a structural wage stagnation. For the last 34 years, wages have been growing at the effective real annual rate of 0.51%. Consumers who rely on salary alone, cannot increase discretionary spending too much. As discretionary spending declines, economic growth will slow down. This creates a risk for the next economic recession.

Category: Economy | Tags: economic growth, historical income, inflation, real median income, structural wage stagnation, Wage stagnation, weak economic growth

Forecasting the Future Standard & Poor’s 500 Index for the Year-End 2018

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January 29, 2018 by Ivan V. Sichkar

This is my sixth annual forecast of the S&P 500 Index return for the year. It is based on the …
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Category: Economy, Finance | Tags: estimate stock market performance, forecast S&P500, future stock market performance, GDP and S&P 500, Predict stock market, Stock market return in 2018

Investors Cause Yield Curve to Invert

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September 4, 2017 by Ivan V. Sichkar

On one side, the Fed pushes short-term yields higher. On the other side, strong demand from investors pushes long-term yields lower. Investors may demand more long-term US government bonds in the coming years causing the yield curve to turn negative or to invert

Category: Economy | Tags: attractive long-term yield, attractive yield, baby boomers, Demand for Treasuries, Federal Reserve Bank, geopolitical risk, Inverted Yield, investors cause yield curve to decline, investors demand treasuries, monetary policy effect on the yield curve, return on US Treasury bonds, target date funds, US Treasury securities, Yield Curve

Fed Makes Yield Curve Look Flat

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August 25, 2017 by Ivan V. Sichkar

The yield curve is likely to continue to flatten. The Fed has a strong control over the short term rates through its FOMC policies: setting the federal funds rate and by purchasing US treasuries. The long-term yields are out of the Fed’s control

Category: Economy | Tags: Fed cannot control long-term yield, Fed effect on yield, Fed makes yield curve flat, Federal Reserve Bank, Flat Yield, monetary policy, yield, Yield Curve

Forecasting the Future S&P 500 Index for the Year-End 2017

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January 11, 2017 by Ivan V. Sichkar

Based on the statistical analysis and the forecast using GDP and S&P 500 data, I expect the S&P 500 Index to close at 2,375 on December 29, 2017. That is a potential annual upside of 6.1% from the closing price of 2,238 on December 30, 2016.

Category: Economy, Finance | Tags: forecast market performance, forecast of the stock market, forecasting S&P 500, GDP, GDP and S&P500, predicting stock market return, S&P500