What to watch in the week ahead 5/15

Key takeaways

  • Consumption data, housing starts and manufacturing are the highlights of next week’s economic calendar. 
  • Geopolitical risk is unlikely to subside anytime soon, as fighting intensifies in Eastern Ukraine. 
  • Yieldstreet launched Art Equity Fund IV, with iconic work from New York artist Jean-Michel Basquiat. 

As we anticipated last week, market movements were pronounced after the Fed meeting and CPI readings. The FOMC seemed confident in its plan – and market pricing is currently in line with it – of two additional 50 basis point hikes, with the potential to revert to smaller increases in September. However, CPI data overshot expectations, which increased market turmoil towards the end of the week as investors kept looking for direction in the tug of war between inflation and a potential recession. In addition, there was chaos in the crypto market, with a well-known stablecoin exchange balking amidst investor redemptions. 

In the meantime, the US remains a relatively safe haven for capital fleeing riskier geographies – such as Europe and Asia. Dollar demand has recently increased and is projected to remain strong until market uncertainty subsides. 

Ask the American consumer…

Investors looking for clues about the economy will be scrutinizing Tuesday’s April retail sales, which are expected to shed some light on consumer confidence. Consumption has been surprisingly resilient in the past readings despite inflation, supply-chain woes and a war in Europe, but consumers appear to have increased credit spending. According to data from the Federal Reserve, revolving consumer credit growth—mostly reflecting outstanding credit card balances—accelerated to a +42% annualized rate to $31 billion, raising sustainability questions going forward. 

Industrial production data – a leading indicator of economic activity – will also be released on Tuesday. The industrial production index (IPI) measures levels of production and capacity in the manufacturing, mining, electric, and gas industries, relative to a base year. A strong reading may point to lower odds of a recession. 

Invest in Art Today

Finally, the end of the week will be focused on housing numbers – housing starts on Wednesday and home sales on Thursday. Needless to say, the housing market is a bedrock – and a bellwether – of the US economy, and has been recently rocked by a decisive increase in mortgage rates that has decreased affordability. 

No end in sight 

With the United States Congress greenlighting an additional $40 billion in aid for Ukraine – which includes, but is not limited to, defense spending – Russian victory prospects appear to be fading. The war has entered a new phase, and neither party is for now incentivized to come to the negotiating table in earnest. While some friction emerged between the US and its European allies – more concerned about the price of energy and a higher risk of being directly involved in the confrontation – the Western alliance is still unequivocally supporting Ukraine. 

However, as hostilities protract, the negative geopolitical climate is likely to continue to increase equity risk premia, beyond what would be expected given the deteriorating macroeconomic conditions. 

A place to hide…

The equity market and crypto selloffs, while triggered by fundamental factors such as the increase in interest rates that put a dent on growth stocks and made margin positions unsustainable, were likely to have been exacerbated by retail investors being overly concentrated in some key assets – tech stocks being a telling example. This behavior was likely to have been partly fueled by platforms that market assets without giving investors the tools to make informed investment decisions. While liquidity – i.e. the capacity to sell a position at any given time – can give some peace of mind, it is helpful to remember that panic selling can lead to substantial losses, and create additional market turmoil. 

Yieldstreet continues to believe in the importance of offering investors professionally vetted opportunities within the private market space. This past week, amidst continued market volatility, we launched Art Equity Fund IV, which includes an iconic work from late New York artist Jean-Michel Basquiat. 

How helpful is this content?

Was this content helpful?

Sign up with Yieldstreet and be the first to know about our latest offerings, recent news, upcoming events, and more.

Your email will never be shared and will only be used for Yieldstreet updates. Already a Yieldstreet member? You're already set up to be notified.

Share this article:

Join a community of 350,000+ members

  • Gain access to unique offerings previously reserved for the ultra-wealthy

  • Customize your portfolio for income, growth, or a balance of both

  • Get started today and earn an average IRR of over 8%

What investors are saying about Yieldstreet

Apr 2022

The due diligence, risk management, and product education materials are thorough, excellent, and easy to use and understand.

Manoj J
Member since 2019
Apr 2022

Excellent and unique selections that I can't find elsewhere.

Jonathan S
Member since 2019
Apr 2022

The platform delivers in a very concise manner. Easy to get a clear understanding at a glance from the web or mobile app.

Tim S
Member since 2021
The testimonials presented on this page have been provided by actual investors in Yieldstreet funds without compensation. Yieldstreet has selected the testimonials, and certain testimonials have been edited to remove personally identifiable information and for brevity. Testimonials were not selected based on objective or random criteria, but rather were selected based on Yieldstreet's understanding of its relationship with the providers of the testimonials. The uncompensated testimonials presented here may not be representative of other investors' experiences, and there can be no guarantee that investors will experience future performance or success consistent with the testimonials presented.

The Yield

Our weekly podcast providing ideas about how to make money work for you and bring you closer to your dreams.

Since inception, over $2.5B has been invested on Yieldstreet

Join today for free to access alternative investment opportunities.