Independent Strategy
Independent Strategy: Nick Kennedy

Nick Kennedy, Chief Economist

NICK KENNEDY, Chief Economist, joined Independent Strategy in December 2012. He bears primary responsibility for all aspects of Independent Strategy’s investment research process, with a focus on macroeconomics and financial market strategy. He holds an honours degree in Politics and Modern History from Manchester University and holds the MSTA designation from the Society of Technical Analysts.

Posts by Nick Kennedy

The headline Q2 GDP number looks like quite a big miss as +6.5% q/q ann. versus the +8.5% mkt median.  And Q1 was revised down a touch too.  But the underlying picture still looks pretty robust in reality.  In fact, the bulk of the miss could be attributed to the ongoing disruptions that Covid continues to generate, specifically in terms of the further sharp decline we saw in inventories, which knocked 1.1% pts from that 6.5% rate.  Government spending was also notably weak (its contribution knocking a further -0.3% pts off the headline), particularly government investment.

Amid the ongoing spread of the Delta variant the Google activity data through to 24th July is showing a fairly clear picture as to where the damage is being done.  And its perhaps not much of a surprise to see that the places where vaccine rollout has been most efficient are faring rather better than in the countries where efforts have been rather more pedestrian.

The Google activity data through to 17th July continues to support the recovery thesis, with global activity remaining near its recent peaks and economic activity holding above its pre-pandemic starting point (+3pts).  Mobility meanwhile has eased a little bit, remaining 17pts below where it stood pre-Covid.

Vaccinations Total global vaccinations administered rose 6% (down from a growth rate of 7% in the prior period), an increase of 210mn.  The rate of increase fell everywhere in both developed and developing economies, with the exception of Southeast Asia.

The Google activity data through to 10th July throwing up nothing to alter the underlying view that the economic recovery continues to move ahead.  Global activity is trundling along near recent highs.  That is important given the recent uptick in Covid cases as the Delta variant continues to spread – largely we would stress among unvaccinated groups, which also happen to be in most cases those that are unlikely to suffer from the more severe symptoms that forced lockdowns earlier in the Pandemic.

Strong payroll gains with some additional impetus from upward revisions.  Overall the economy added 850k jobs in June (mkt 700k) up from 583k in May (revised from 559k), of which 662k came from private payrolls (mkt 600k).  Manufacturing added 28k jobs and government 188k.  Labour participation unchanged at 61.6% and the unemployment rate actually ticked up to 5.9%, as job gains were netted off with an increase in the labour force.  Note prime age participation (25-54) increased for both male and female workers.  This is positive and should dampen worries about labour scarcity.

Looking at the Google activity data through to 26th June it looks as if there are some early signs that the recent pick up in infections/increase in risk perceptions has started to eat into activity a little.  But even in places where infection rates have risen fairly rapidly – the UK for example – the corresponding drop off in activity has been mild.

Independent Strategy Media

MEDIA » 28th June, 2021Redline Money Mixdown — Episode 16: “Fed Speak”

Carolyn Wright, David Roche and Richard Harris discuss “Fed speak”.

RedLine Money takes the expertise of David Roche and Richard Harris as they talk markets, prices, bubbles, and busts — and some even more interesting topics!

Where is your Red Line?  No losses?  Make as much as inflation?  Or make as much money as you can?  How much pain can you take? Investors need to find out what their red line is — and how it moves.  The RedLine Money podcast can help you find it.

David and Richard have nearly a century between them of searching for the Red Line in bull markets and bear.  Hear what the crowd isn’t saying about current markets and price moves.  In the long term, and even longer — back to the Egyptians.  See markets as an engineering system, a biological organism, or as the behaviour of sub-atomic particles.  You don’t get this from anywhere else.  You know it makes sense.

David Roche, Independent Strategy Ltd

Richard Harris, Port Shelter Investment Management

Carolyn Wright (moderator)

RedLine Money is produced weekly in Hong Kong.

Music by TimMoor from Pixabay

Network:
Independent Strategy Media

MEDIA » 21st June, 2021Redline Money Mixdown — Episode 15: The advantages of women

Carolyn Wright, David Roche and Richard Harris discuss the advantages of being a women in post-Covid open societies.  See our report Did Covid cure the virus of man? (https://www.instrategy.com/reports/did-covid-cure-the-virus-of-man/)

RedLine Money takes the expertise of David Roche and Richard Harris as they talk markets, prices, bubbles, and busts — and some even more interesting topics!

Where is your Red Line?  No losses?  Make as much as inflation?  Or make as much money as you can?  How much pain can you take? Investors need to find out what their red line is — and how it moves.  The RedLine Money podcast can help you find it.

David and Richard have nearly a century between them of searching for the Red Line in bull markets and bear.  Hear what the crowd isn’t saying about current markets and price moves.  In the long term, and even longer — back to the Egyptians.  See markets as an engineering system, a biological organism, or as the behaviour of sub-atomic particles.  You don’t get this from anywhere else.  You know it makes sense.

David Roche, Independent Strategy Ltd

Richard Harris, Port Shelter Investment Management

Carolyn Wright (moderator)

RedLine Money is produced weekly in Hong Kong.

Music by TimMoor from Pixabay

Network:

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