President Trump explained this week that he is “very, very close” to appointing a new Fed Chair. As we continue to await this highly anticipated decision, several key hints were made this week that can give us a general idea of where Trump is leaning. After meeting with Janet Yellen, Trump praised her as “terrific” without giving us an idea of whether she will be re-appointed or not. Gary Cohn seems to be out of the running, narrowing down the finalists to Yellen, Stanford economist John Taylor, and Fed Governor Jerome Powell. This will continue to be an important development to watch as the appointment carries large implications on our economy as a whole.
Deutsche Bank (DB) and Barclays (BCS) both missed earnings this week while several big tech stocks helped keep the market chugging. Amazon (AMZN), Twitter (TWTR), and Alphabet (GOOGL) all beat expectations as their stocks surged after hours on Thursday. It took nearly 3 months, but Amazon CEO Jeff Bezos is finally back atop the list of richest men alive after surpassing Bill Gates with a massive third quarter earnings beat. After a sluggish summer, it seems the FAANG stocks have bounced back in the month of September and continue to feed the bull market.
This past weekend, the Prime Minister of Spain, Mariano Rajoy, called for the removal of Catalan President Carles Puigdemont as tensions in the region continue to escalate. Rajoy announced plans to dissolve the regional government by removing current leaders and holding immediate new elections. Hundreds of thousands of Catalonia residents took to the streets to protest the Prime Minister’s presumed act of aggression. This will be an interesting development to watch as continued unrest will have a far-reaching impact on Catalonian banks and the Spanish economy as a whole.
The European Central Bank announced this morning that it would extend the duration of its bond-buying program while cutting its monthly bond purchases in half. Mario Draghi announced that starting in January, the ECB would cut its monthly bond purchases from 60 billion euros to 30 billion euros. Since this decision will have far-reaching consequences for future borrowing costs, the ECB decided to extend the duration of the program to slow down its impact. In addition, Draghi explained that the bank would keep the program open-ended in case of a financial downturn, which sent European shares higher as markets anticipated cheap money for a longer period.
We are proud to announce that Rapunzl came in 3rd place at the 2017 Fund Conference yesterday as we connected with brilliant entrepreneurs from around the country. Thank you to everyone who voted and showed up for the annual event.