Shifting Demographics and Rising Debt Levels

Shifting Demographics and Rising Debt Levels By Blu Putnam, Chief Economist Erik Norland, Senior Economist CME Group Demographic Changes Realign Economic Priorities ​​​​​​Nations with young populations focus on job creation as top economic priority. Health and wealth are twin pillars of aging nations with stagnant labor force. Lack of labor force growth could lead to … Read More

Lessons from 2008 and 2020

Policy Responses and Outcomes to Great Recession and Pandemic By Blu Putnam, Chief Economist ,CME Group Lessons from 2008 and 2020 ​​​​​​Great Recession began September 2008, equities recovery started in March 2009. Real GDP reached pre-recession peak in Q1 2011, jobs fully recovered in May 2014. Pandemic hit U.S. equities in late February, market recovery … Read More

Reshaping Fed Policy and Implied Volatility in Copper

Reshaping Fed Policy and Copper’s Elevated Implied Volatility By Blu Putnam, Chief Economist Erik Norland, Senior Economist CME Group Ending Fed Emergency Supports Fed signals earlier-than-expected exit from zero rates, tapering of asset purchases. A return to pre-pandemic norms might mean ending emergency supports. Biden administration appointments to Fed could help reshape monetary policy. Second-half … Read More

Dividend Slump and Ag Market Signals

Dividend Slump and Ag Market Signals By Erik Norland, Senior Economist, CME Group Investors Expect Dividends to Decline in 2020s ​​​​Investors expect dividends in real terms  to decline 15.4% by 2031. The expectations are based on a compounded inflation rate of 29.4%. Dividends grew by an inflation-adjusted 115% from 2010 to 2020. Higher bond yields and … Read More

Options in Oil and Inflation Narratives

Options in Oil and Inflation Narratives By Blu Putnam, Chief Economist Erik Norland, Senior Economist CME Group Oil in Backwardation ​Reopening of economies lifts WTI oil prices above $70/barrel. Oil market in backwardation, with demand expectations rallying spot prices. Options open interest rising for strike prices at $100 or higher. Could oil prices rise to $100 … Read More