📑 Research Notes for 2021-07-06
This week, we look at Taylor Rule suggestions, the potential effects of Biden tax hikes, the generational wealth gap, and JPMorgan's Guide to the Markets.
We conduct extensive investment research and share the most interesting content that we come across every week. Here is a curated list of this week’s top observations.
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Taylor Rule Suggests Rates Should Be Higher.
(Disciplined Systematic Global Macro Views)
Should rates be higher or lower than current levels? Many can provide narratives associated with reasons for rates moving in either direction. To some degree, these are just guesses. If rates are falling, then the weight of market opinion is changing toward lower inflation expectations. If rates are rising, the opposite is occurring. To provide some concrete value decision, we need to have some valuation model that can get into the specific for why rates should be higher or lower.
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Big Tech and Healthcare Stocks Stand To Lose Most from Potential Biden Tax Hikes.
(Markets Insider)
Large-cap tech and healthcare stocks could suffer the most if US taxes go up or if a global minimum tax is enacted, BlackRock analysts wrote in a note. The category with the biggest market cap and lowest effective rate was information technology, including the likes of Amazon and Microsoft. The analysts suggested investors consider small- and medium-cap firms that are less exposed to international tax changes.
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Each New Generation Has A Harder Time Overcoming the Wealth of Their Parents.
(CFA Institute)
For the first time, a generation of young people discovered not without bitterness that they would live worse than their parents. The political-economic-social system that emerged in Western countries after World War II was based on a very simple premise: if you worked hard, if you tried hard enough, you could always live better than your parents. That truth held for a few decades. At the beginning of the eighties, it began a slow and gradual decline, finally consummated in the Great Recession of 2008.
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3Q 2021 Guide to the Markets.
(JPMorgan)
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Curated by Joseph Lu, CFA®
Joseph has over a decade of experience as an investment professional, primarily in quantitative analysis and portfolio management roles. He is the founder and managing director of Conscious Capital Advisors and a CFA® Charterholder. The CFA charter is a globally respected, graduate-level investment credential by the CFA Institute, a global association of more than 90,000 investment professionals working in over 133 countries.
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