Ringing the BellBell Tower Associates' Thoughts on Global Economics and Markets
How does one detect a disease with few signs, a disease whose symptoms may not manifest for months, years—even a decade? If a collection of researchers from a number of universities (including Indiana, Purdue, and the Indiana Melvin and Bren Simon Cancer Center) is correct in their latest findings, the answer may be found in a fundamental building block of human life. Using nanotechnology, these researchers have designed a microRNA sensor to diagnose pancreatic cancer before it spreads to other organs, which limits the options available to treat it.
It’s a common occurrence in the biotech sector; a company is doing fantastically, their stock rising, due to great news about their product, and then all of a sudden someone you’ve never heard of, someone who is “short the stock” (we’ll talk about what that means in a second) comes out and says the stock is worthless and, in the blink of an eye, the stock price tumbles. What should you do? Jump out with the crowd? Assume that the short seller is right? Or hold on tight?
It’s a common reality for too many to find a missing pair of keys perhaps in the pantry, or in the fridge, with an elderly family member in the house. But can something as a simple as a game make a difference?
One of the biggest economic concerns in recent years has been the stagnation of wages, but many times, simply looking at those numbers on a paycheck—the nominal wage—is not enough to tell if wages have really gone up or down. Sometimes, it is necessary to look at real wages.
Buying a stock in general is a difficult decision. Will it go up? Down? Flat-line? Squiggle around in a chart on that one website I saw? The list of questions goes on. Some people can be paralyzed by the prospect of looking at a stock, much less buying one. All those different graphs and opinions! Doesn’t have to be that difficult. Having useful information and research behind you can push you in the right direction.
Imagine you are a football player, and you just sacked the opposing team’s quarterback for a ten-yard loss. You are pumped, doing your little sack-dance, when suddenly you see the yellow flag flying and the referees come sailing in. Turns out, the NFL just changed the rules. You’re not allowed to hit the quarterback unless you’re one of the defensive linemen, and you’re just a linebacker.
You now have an idea what it may be like to be in the markets following the Federal Reserve (FED)’s decision not to raise interest rates in yesterday afternoon’s press conference. FED Chair Janet Yellen made a number of remarks that raise the question: has the FED changed the rules in the middle of the game?
The Ancients were not known to be entirely investor-savvy people. The great Aristotle believed it was unnatural for money to breed money and thus condemned investing. There are always exceptions, however.
GDP numbers released seem to indicate positive growth in the US economy. Whew! After seeing the Stock markets here and abroad taking severe nose-dives and discussions of the Fed possibly changing its mind about raising interest rates, the Bureau of Economic Analysis’ newest news release sent waves of cool air down the sweaty neck of the financial world.
Now, unlike Shakespeare’s play, the probability that there is a secret fairy king who is increasing Personal Consumption Expenditures for the benefit of the GDP is extremely low. Nevertheless, it would be fruitful to pull back the curtain to see behind the GDP stage before jumping to any conclusions.