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Erik S. Weisman, Ph.D.

Chief Economist

Erik S. Weisman, Ph.D., is an investment officer, chief economist and portfolio manager at MFS Investment Management® (MFS®). As a member of the Fixed Income team, he manages the firm's US and non-US inflation-adjusted, strategic income, global total return and global government portfolios. 

He joined the firm in 2002 as a global sovereign fixed income research analyst. Previously, he served for two years as assistant to the US executive director for the International Monetary Fund and for two years as an international economist in the Office of Central and Eastern Europe of the U.S. Department of the Treasury. 

Erik earned a bachelor's degree from the University of Michigan and master's and Ph.D. degrees from Duke University.

 

August 14, 2017

by Erik S. Weisman, Ph.D., Chief Economist

Since we outlined our thoughts in early July on the impending shift in US Federal Reserve (the Fed) policy to gradually allow securities held on the Fed’s balance sheet to mature, a bit more information has come to light. In its July statement, the Federal Open Market Committee (FOMC) said it expects to begin implementing the balance sheet normalization process relatively soon, provided the economy evolves broadly as anticipated. Previously, the committee had indicated it expected to begin implementation this year, so observers, including us, have concluded that officials are comfortable beginning implementation of the runoff in the September–October time frame. However, if bills to raise the debt ceiling and fund the US government have not been passed by late September, the FOMC could defer action until later in the fall in order to avoid inserting itself into a moment of market uncertainty. 

by Erik S. Weisman, Ph.D., Chief Economist

Since we outlined our thoughts in early July on the impending shift in US Federal Reserve (the Fed) policy to gradually allow securities held on the Fed’s balance sheet to mature, a bit more information has come to light. In its July statement, the Federal Open Market Committee (FOMC) said it expects to begin implementing the balance sheet normalization process relatively soon, provided the economy evolves broadly as anticipated. Previously, the committee had indicated it expected to begin implementation this year, so observers, including us, have concluded that officials are comfortable beginning implementation of the runoff in the September–October time frame. However, if bills to raise the debt ceiling and fund the US government have not been passed by late September, the FOMC could defer action until later in the fall in order to avoid inserting itself into a moment of market uncertainty. 

August 11, 2017

For the week ending 11 August 2017

  • War of words between North Korea and US intensifies amid UN sanctions
  • US inflation rises less than expected
  • Venezuelan Constituent Assembly declares itself superior
  • South Africa’s Zuma survives confidence vote
  • UK floats trial balloon on divorce settlement

 

Global equities gave ground this week amid intensifying geopolitical concerns as tensions between North Korea and the United States ratcheted higher. Safe-haven assets were in demand as investors struck a risk-off posture. Bonds rallied, pushing the yield on the 10-year US note to 2.21% from 2.27% a week ago. Safe-haven currencies such as the Swiss franc and Japanese yen firmed, as did precious metals. Oil prices retreated modestly, as West Texas Intermediate crude declined to $48.20 a barrel from $49 a week ago. Volatility, as measured by the Chicago Board Options Exchange Volatility Index (VIX), rose considerably, to 15.50 from 9.90 last Friday.

August 11, 2017

For the week ending 11 August 2017

  • War of words between North Korea and US intensifies amid UN sanctions
  • US inflation rises less than expected
  • Venezuelan Constituent Assembly declares itself superior
  • South Africa’s Zuma survives confidence vote
  • UK floats trial balloon on divorce settlement

 

Global equities gave ground this week amid intensifying geopolitical concerns as tensions between North Korea and the United States ratcheted higher. Safe-haven assets were in demand as investors struck a risk-off posture. Bonds rallied, pushing the yield on the 10-year US note to 2.21% from 2.27% a week ago. Safe-haven currencies such as the Swiss franc and Japanese yen firmed, as did precious metals. Oil prices retreated modestly, as West Texas Intermediate crude declined to $48.20 a barrel from $49 a week ago. Volatility, as measured by the Chicago Board Options Exchange Volatility Index (VIX), rose considerably, to 15.50 from 9.90 last Friday.

August 4, 2017

For the week ending 4 August 2017

  • US nonfarm payrolls rise
  • Grand jury empaneled in Russia/election probe
  • Dow sets record on impressive corporate earnings
  • Trump signs bill sanctioning Russia, Iran and North Korea
  • US considers trade action against China
  • Greenspan sees bond bubble

 

Global equities edged higher this week amid continued strength in US markets as another impressive earnings season unfolds. The Dow surpassed the 22,000 mark during the week, aided by a tailwind from a weakening US dollar and supportive US economic data. The euro rose to an 18-month high, acting as a headwind for shares of European multinationals but supporting commodity prices. West Texas Intermediate crude oil prices broke above the $50-per-barrel barrier at midweek, but eased to end near $49, down slightly from last week’s $49.65. The yield on the US 10-year Treasury note slipped three basis points on the week to 2.27%. Volatility, as measured by the Chicago Board Options Exchange Volatility Index (VIX), declined to 9.9 from 11.0 a week ago. 

For the week ending 4 August 2017

  • US nonfarm payrolls rise
  • Grand jury empaneled in Russia/election probe
  • Dow sets record on impressive corporate earnings
  • Trump signs bill sanctioning Russia, Iran and North Korea
  • US considers trade action against China
  • Greenspan sees bond bubble

 

Global equities edged higher this week amid continued strength in US markets as another impressive earnings season unfolds. The Dow surpassed the 22,000 mark during the week, aided by a tailwind from a weakening US dollar and supportive US economic data. The euro rose to an 18-month high, acting as a headwind for shares of European multinationals but supporting commodity prices. West Texas Intermediate crude oil prices broke above the $50-per-barrel barrier at midweek, but eased to end near $49, down slightly from last week’s $49.65. The yield on the US 10-year Treasury note slipped three basis points on the week to 2.27%. Volatility, as measured by the Chicago Board Options Exchange Volatility Index (VIX), declined to 9.9 from 11.0 a week ago. 

July 28, 2017

For the week ending 28 July 2017

  • US growth sees modest Q2 bounce-back
  • Fed: Balance sheet runoff to commence “relatively soon”
  • IMF lowers US growth outlook, raises others'
  • US Senate debates Obamacare changes
  • Abe’s support slides as scandals mount
  • Trump backs corporate, middle-class tax cuts

 

Global equities rose a touch this week, with major US indices once again setting new highs. The yield on the US 10-year note rose six basis points to 2.30% on the week while the price of West Texas Intermediate crude oil rose over $3 a barrel to $49.65. Volatility, as measured by the Chicago Board Options Exchange Volatility Index (VIX), rose to 11.00 from 9.9 a week ago. 

For the week ending 28 July 2017

  • US growth sees modest Q2 bounce-back
  • Fed: Balance sheet runoff to commence “relatively soon”
  • IMF lowers US growth outlook, raises others'
  • US Senate debates Obamacare changes
  • Abe’s support slides as scandals mount
  • Trump backs corporate, middle-class tax cuts

 

Global equities rose a touch this week, with major US indices once again setting new highs. The yield on the US 10-year note rose six basis points to 2.30% on the week while the price of West Texas Intermediate crude oil rose over $3 a barrel to $49.65. Volatility, as measured by the Chicago Board Options Exchange Volatility Index (VIX), rose to 11.00 from 9.9 a week ago. 

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James T. Swanson, CFA

Chief Investment Strategist

James Swanson, CFA, is an investment officer and chief investment strategist of MFS Investment Management® (MFS®). He is also a fixed income portfolio manager. 

James offers his insights and perspective on the markets and the economy to MFS clients around the world through in-person meetings, his Strategist's Corner online column and a blog launched in 2011. He is a frequent guest commentator on the markets on CNBC, Fox Business and Bloomberg Television and is often quoted in leading national and financial publications, including the Wall Street Journal, the New York Times, the Los Angeles Times and Investor's Business Daily. James joined MFS in 1985. He was named fixed income strategist in 2001 and chief investment strategist in 2004. 

He is a graduate of Colgate University and the Harvard Business School. James holds the Chartered Financial Analyst designation.

July 2017

by James T. Swanson, CFA, Chief Investment Strategist

For decades, experts at the US Federal Reserve, academic economists and portfolio managers have been at war with inflation — the phenomenon of price increases without commensurate productivity gains. Investors and policymakers alike hate inflation because it robs consumers of buying power and discourages money flows into long-term investments for fear that their value will be eroded. The remedy for inflation in past cycles has been for central banks to raise interest rates in order to cool off growth and end speculative investing, thus curbing broad-based consumer price increases. Usually inflation flare-ups occur a couple of years into a cycle, or at mid-cycle at the latest.

by James T. Swanson, CFA, Chief Investment Strategist

For decades, experts at the US Federal Reserve, academic economists and portfolio managers have been at war with inflation — the phenomenon of price increases without commensurate productivity gains. Investors and policymakers alike hate inflation because it robs consumers of buying power and discourages money flows into long-term investments for fear that their value will be eroded. The remedy for inflation in past cycles has been for central banks to raise interest rates in order to cool off growth and end speculative investing, thus curbing broad-based consumer price increases. Usually inflation flare-ups occur a couple of years into a cycle, or at mid-cycle at the latest.