The Spread Widens

The Spread Widens

  This week, I want to focus on what is called a “credit spread” indicator. We highlighted the specific indicator above about a year ago. It measures high-yield (junk bond) credit spreads. In particular, it evaluates the distance between a safe asset—in this...
Measuring Inflation

Measuring Inflation

  Inflation—a general rise in the price of goods and services in an economy—can be problematic for the stock market for various reasons. Not only do input prices go up, which can crimp corporate profits, but consumers lose purchasing power if wages don’t also...
Hitting the Slopes

Hitting the Slopes

  For this week’s Indicator Insights, we highlight a price-based indicator that measures the intermediate-term trend of the stock market. Specifically, it measures the 126-day (6-month) moving average of the S&P 500 stock market index, shown as the orange...
The Trend Tires Out

The Trend Tires Out

  When you look at a graph of the stock market, or, more specifically, an index of stocks—like a global stock market index—you notice that it tends to travel in trends over time. Sometimes it trends up, and sometimes it trends down. Coming out of the pandemic...