Can a single index truly predict economic recessions? Join Megan as she answers this question in our latest episode. This month, the Leading Indicator Index has once again shown a negative trend, marking 27 out of the past 28 months. She unpacks the components behind this month's reading, such as declining ISM new orders, rising jobless claims, the infamous yield curve inversion, and waning consumer sentiment. Despite some positive signals from stock prices and building permits, the negative factors continue to dominate.

She also examines the skepticism surrounding this index's relevance as a recession indicator, particularly given its strong focus on goods in an economy where the service sector remains robust. Tune in as we explore the intricacies of this data and what it signals for our economic future. Don't miss out on this insightful discussion that will leave you better informed about the potential twists and turns in the economy. If you find our analysis valuable, be sure to share, like, and subscribe to Markets with Megan. For more episodes, visit our podcast page at verdece.com/podcasts. 

https://youtu.be/SPjk00xKSO0

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

The latest episode of our podcast shines a light on the intriguing dynamics of the housing market, focusing on the contrasting trends between multifamily and single-family homes. In June, we witnessed some unexpected developments that could reshape the future of real estate. With a notable 3% increase in housing starts and an even more impressive 3.4% rise in building permits, the housing market is showing signs of life, but not without its complexities.

Megan unpacks the latest housing data, revealing a mixed bag for the market. While multifamily housing starts surged by nearly 20%, single-family homes declined, marking the fourth consecutive month of decreased starts. This divergence raises important questions about the sustainability of current trends and the broader economic implications.

One key point of discussion is the persistent shortage of single-family homes in the U.S. Despite the encouraging numbers for multifamily housing, the single-family sector remains in a slump. Building permits for single-family homes have also declined for five consecutive months, signaling potential challenges ahead. The episode explores the factors contributing to this shortage, including rising construction costs, labor shortages, and regulatory hurdles.

The rise in multifamily housing is not just a statistical anomaly; it reflects broader economic conditions. As mortgage rates pulled back slightly in June, housing activity had a corresponding uptick. However, this positive momentum was primarily confined to the multifamily sector. Megan examines how demographic shifts, such as the increasing preference for urban living and rental properties among younger generations, drive this trend.

Tune in!

https://youtu.be/_dG3wSUnhVY

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

In this episode, Megan discusses the unexpected consumer spending behavior despite the high credit card debt and soaring interest rates. June's retail sales data has painted a surprising picture, showing how consumers navigate these economic pressures. Contrary to the anticipated decline, retail sales remained flat, providing a beacon of stability amid financial challenges.

One of the standout revelations from June's data is the strength in specific retail sectors. Internet sales, building materials, health care, personal care, and clothing posted significant gains. These areas have shown remarkable robustness, reflecting consumers' adaptive spending habits. The uptick in internet sales is particularly noteworthy, as it underscores the ongoing shift towards e-commerce. Building materials also rose, possibly driven by a renewed interest in home improvement projects.

Despite these positive trends, not all sectors fared equally well. Motor vehicle sales experienced a decline, likely influenced by falling automobile prices and possibly a saturation in demand. Additionally, restaurant spending showed some softness, indicating that consumers might be cutting back on discretionary spending in favor of essential items. This mixed performance across sectors highlights the complexity of consumer behavior in the current economic climate.

Find out more in today's episode.

https://youtu.be/vPOozGP0htY

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

Is the battle against inflation finally taking a turn for the better? We dissect two key reports that could signal major movements in the market. First, we bring you the good news from the Consumer Price Index (CPI) report, where a surprising deflationary reading hints at easing pressures for the Federal Reserve. Falling prices in sectors like energy, vehicles, and airline fares are shaping the economic outlook, so what could this mean for future policy adjustments?

Megan also explores the more complicated picture painted by the Producer Price Index (PPI) report, which came in hotter than expected. Understand the mixed signals this sends to the Federal Reserve and the markets. Plus,she discusses the pivotal role of upcoming labor market reports in determining the next steps for economic policy. Get the comprehensive analysis that will help keep you informed on where the economy stands and the potential road ahead.

https://youtu.be/SVriWzFe6is

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

Is the Federal Reserve gearing up for a rate cut as early as September? Join us on today's episode as we review Chairman Jerome Powell's latest testimony to Congress. We'll dissect his comments on inflation and interest rates, and why his cautious optimism toward the 2% inflation target is making waves in the financial markets. Also, with a cooler job market on the horizon, investors are buzzing about the possibility of a rate cut sooner than expected. We'll explore the delicate balance the Fed is maintaining to ensure both economic stability and inflation control.

We'll also look at the potential consolidation within the small and mid-cap banking sectors and the political ramifications of the Fed's decisions. With the crucial CPI and Producer Price Index reports just around the corner, we'll discuss their potential impact on the Fed's future actions. Stay tuned for our in-depth analysis and insights, and don't forget to send your questions and comments to [email protected].

https://youtu.be/2phDAjkx2jE

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

In our latest podcast episode, we delve into some pressing economic issues that could have far-reaching implications for the broader economy and individual financial decisions. The latest ISM services report has revealed a worrying trend: a drop to 48.8, indicating the first contraction in the service sector since May 2020. This contraction is particularly concerning given the current economic environment marked by high inflation and mounting credit card debt.

The significance of the ISM services report cannot be overstated. Consumers spend the majority of their money on the service sector, which includes everything from dining out to healthcare. A contraction in this sector could signal a slowdown in consumer spending, which is a crucial driver of economic growth. The reading of 48.8 is especially alarming because any reading below 50 indicates contraction, while a reading above 50 indicates expansion. This drop is a stark reminder that the economy is not out of the woods yet, despite some recent positive indicators.

Adding to the concerns is the employment index, which plummeted to 46.1. This is significantly lower than the expected 49.5 and suggests that job growth in the service sector is also faltering. Employment is a key component of economic health, and a decline in this area could have a ripple effect across other sectors. This is particularly troubling as we approach the release of the crucial jobs report, which will provide further insights into the state of employment in the country.

New orders in the service sector also showed a declining trend, which is another red flag. New orders are a leading indicator of future activity, and a contraction here suggests that businesses are not seeing the demand they had anticipated. This could lead to reduced business investments and potentially even layoffs, further exacerbating the economic challenges.

https://youtu.be/rNH-mOHYlNE

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

In the latest episode, we explore the significance of the ISM Manufacturing Report and its implications for the U.S. economy. The report, which gauges the health of the manufacturing sector, recently registered a contraction with a reading of 48.5, underscoring ongoing economic challenges. Megan emphasizes that this metric, below the crucial 50-point threshold indicating expansion, signals potential impacts on broader economic indicators like GDP and inflation.

She analyzes key components of the report such as new orders and delivery times, which showed slight improvements amidst overall contraction. She also explains how these factors offered insights into future manufacturing activity and supply chain efficiency, though the sector's decline in production remains a concern linked closely with GDP performance.

We also addressed the inflationary landscape, noting a decrease in manufacturers' costs albeit with persistent pressures. This nuanced interpretation of economic data prepares listeners for upcoming insights amidst a holiday-shortened week. For those seeking a deep dive into economic indicators and their implications, "Markets with Megan" provides essential analysis and updates to navigate current economic trends effectively.

https://youtu.be/uN8saftdzCQ

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

In the 150th milestone episode of "Markets with Megan," we delve into some critical economic indicators that are currently shaping the Federal Reserve's approach to interest rates. Specifically, we discuss the unexpected slowdown in core PCE inflation, labor market trends, and what these mean for future rate policies. This episode is particularly significant as it not only reflects on how far the podcast has come but also offers a nuanced understanding of recent economic data.

One of the most intriguing topics covered is the latest reading on core PCE inflation, which showed a mere 0.08% rise. This is the lowest month-over-month increase since November 2020. The core PCE, or Personal Consumption Expenditures Price Index, is a key inflation indicator closely monitored by the Federal Reserve. A slowdown in core PCE inflation is generally seen as positive news because it suggests that inflationary pressures may be easing, giving the Federal Reserve some breathing room. This figure is even more striking when compared to the January reading, which showed a much higher increase of 0.5%. The significant drop suggests that the measures taken by the Federal Reserve to control inflation are beginning to bear fruit.

https://youtu.be/b1GTTR8EQHA

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

In our latest podcast episode, we delve into the surprising uptick in the first quarter GDP for 2024, which has defied expectations and sparked a wave of cautious optimism. This third reading showed a slight increase to 1.4%, up from the previous estimate of 1.3%. This unexpected growth has left many economists and analysts scratching their heads, trying to decipher the mixed signals sent by various economic indicators.

One of the key components of this GDP report is personal consumption, which, despite being the largest part of GDP, came in lower than expected. Initially estimated to rise by 2% for the quarter, it only increased by 1.5%. This weaker-than-expected consumer spending is a significant factor, as it reflects the overall economic health and confidence of the general public. Consumers are the backbone of the economy, and their spending habits directly influence GDP growth. The lower personal consumption indicates that despite the uptick in GDP, there is underlying weakness that could pose challenges in the coming months.

Another critical aspect discussed in the episode is the core Personal Consumption Expenditures (PCE) price index, which is the Federal Reserve's favored measure of inflation. The core PCE price index was revised up to 3.7% for the quarter, from an earlier estimate of 3.6%. This mixed inflation reading presents a dilemma for the Fed, as it tries to balance stimulating economic growth while keeping inflation in check. Higher inflation rates can erode purchasing power and savings, making it a critical factor for both policymakers and consumers.

https://youtu.be/QvHUeMWyzQA

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...

Megan addresses the alarming drop in housing starts and building permits, which have reached their lowest levels since June 2020. Both single-family and multifamily homes are affected, signaling a broad-based decline in construction activity. Housing starts are a crucial indicator of construction activity, while building permits serve as a leading indicator for future construction. The decline in both metrics suggests that the housing market is struggling to recover, exacerbating the already critical inventory shortage.

This persistent lack of inventory is keeping housing prices high, making it difficult for the Federal Reserve to manage inflation effectively. Megan highlights that while the Fed can influence monetary policy, it has limited tools to directly address the housing shortage. The central bank cannot build new houses, and thus, housing inflation remains a "sticky" issue that complicates their efforts to control overall inflation rates.

In addition to the housing market woes, Megan also touches upon recent trends in the tech sector. After a significant surge, the tech market is experiencing some profit-taking, which is contributing to market volatility. This profit-taking is a natural part of market cycles, especially after a period of substantial gains. However, it adds another layer of complexity to the current economic landscape.

Rising bond yields are another critical topic of discussion in this episode. Bond yields have been on an upward trajectory, which could have significant implications for future Federal Reserve actions. Higher bond yields generally indicate higher borrowing costs, which can dampen economic activity. Megan suggests that the combination of high housing prices and rising bond yields presents a challenging environment for the Fed. The central bank must carefully balance its actions to avoid stifling economic growth while trying to manage inflation.


https://youtu.be/f6NHKV3fx98

Disclaimer: material was prepared by Verdence Capital Advisors, LLC (“VCA”). VCA believes the information and data in this document were obtained from sources considered reliable and correct and cannot guarantee either their accuracy or completeness. VCA has not independently verified third-party sourced information and data. Any projections, outlooks
or assumptions should not be construed to be indicative of the actual events which will occur. These projections, market outlooks or estimates are subject to change without notice. This material is being provided for informational purposes only and is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice. Past performance is not a guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product or anynon-investment related content, made reference to directly or indirectly in these materials will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any
discussion or information contained in this report serves as the receipt of, or as a substitute for, personalized investment advice from VCA. Due to various factors, including changing market conditions and/or applicable laws, the co...