Error!

X

There was a problem contacting the server. Please try after sometime.

Sorry, we are unable to process your request.

Error!

X

We're sorry, but the Insights and Intelligence Tool is temporarily unavailable

If this problem persists, or if you need immediate assistance, please contact Customer Service at 1-888-522-2388.

Error!

X

We're sorry, but the Literature Center checkout function is temporarily unavailable.

If this problem persists, or if you need immediate assistance, please contact Customer Service at 1-888-522-2388.

Financial Professionals

Forgot password

Forgot Your LordAbbett.com password?

If you are a registered user, but have forgotten your LordAbbett.com password, please enter your email address.
Once your email address is verified, we will send you an email with instructions on how to reset your password.

EMAIL ADDRESS
e.g. joe@firm.com

Financial Professionals

Forgot Password

Thank you.

An email has been sent to with instructions on resetting your password.

Financial Professionals

Reset Password

NEW PASSWORD
Your password must be a minimum of characters.
CONFIRM NEW PASSWORD

Financial Professionals

Reset Password

Confirmation Message

Your LordAbbett.com password was successully updated. This page will be refreshed after 3 seconds.

OK

Financial Professional*

  • Gain access to exclusive LinkedIn Groups
  • Simplify your login
LOGIN WITH LinkedIn
LOGIN WITH LinkedIn

A verification Email Has Been Sent

Close

An email verification email has been sent to .
Follow the instructions to complete the email validation process.

I have not received my verification email

Check your SPAM mailbox and make sure that twelcome@lordabbett.com is allowed to send you mail.

I'm still having trouble

If you're still having trouble verifying your email address. feel free to contact us.

1-888-522-2388
clientservices@lordabbett.com


OK

We're sorry. We found no record of the email address you provided.

Close

Register For a LordAbbett.com Account
Using Your Email Address.

  • Registered Financial Advisors gain access to:
  • Our data mining tool, Insight & Intelligence
  • Best in-class practice management content
  • Educational events, videos and podcasts.
  • The Lord Abbett Review - Subscribe now!

Registered but Having Problems?

If you believe you are registered and are having problems verifying your email address, feel free to contact us.

1-888-522-2388 clientservices@lordabbett.com

Terms & Condition

X

These Terms of Use ("Terms of Use") are made between the undersigned user ("you") and Lord, Abbett & Co. ("we" or "us"). They become effective on the date that you electronically execute these Terms of Use ("Effective Date").

A. You are a successful financial consultant that markets securities, including the Lord Abbett Family of Funds;

B. We have developed the Lord Abbett Intelligence System (the "Intelligence System"), a state of the art information resource that we make available to a limited community of broker/dealers through the Internet at a secure Web site (the "LAIS Site"); and

C. We wish to provide access to the Intelligence System to you as an information tool responsive to the demands of your successful business pursuant to these Terms of Use. Accordingly, you and we, intending to be legally bound, hereby agree as follows:]

1. Overview. · Scope. These Terms of Use (which we may amend from time to time) govern your use of the Intelligence System. · Revisions; Changes. We may amend these Terms of Use at any time by posting amended Terms of Use ("Amended Terms of Use") on the LAIS Site. Any Amended Terms of Use will become effective immediately upon posting. Your use of the Intelligence System after any Amended Terms of Use become effective will be deemed to constitute your acceptance of those Amended Terms of Use.We may modify or discontinue the Intelligence System at any time, temporarily or permanently, with or without notice to you. Purpose of the Intelligence System. The Intelligence System is intended to be an information resource that you may use to contribute to your business research. The Intelligence System is for broker/dealer use only; it is not to be used with the public in oral, written or electronic form. The information on the Intelligence System and LAIS Site is for your information only and is neither the tax, legal or investment advice of Lord Abbett or its third-party sources nor their recommendation to purchase or sell any security.

2. Your Privileges. · Personal Use. Your use of the Intelligence System is a nontransferable privilege granted by us to you and that we may deny, suspend or revoke at any time, with or without cause or notice. · Access to and Use of the Intelligence System. The User ID and password (together, an "Access ID") issued by us to you (as subsequently changed by you from time to time) is for your exclusive access to and use of the Intelligence System. You will: (a) be responsible for the security and use of your Access ID, (b) not disclose your Access ID to anyone and (c) not permit anyone to use your Access ID. Any access or use of the Intelligence System through the use of your Access ID will be deemed to be your actions, for which you will be responsible. · Required Technology. You must provide, at your own cost and expense, the equipment and services necessary to access and use the Intelligence System. At any time, we may change the supporting technology and services necessary to use the Intelligence System. · Availability. We make no guarantee that you will be able to access the Intelligence System at any given time or that your access will be uninterrupted, error-free or free from unauthorized security breaches.

3. Rights in Data. Our use of information collected from you will be in accordance with our Privacy Policy posted on the LAIS Site. Our compliance with our Privacy Policy will survive any termination of these Terms of Use or of your use of the Intelligence System.

4. Your Conduct in the Use of the Intelligence System. You may access, search, view and store a personal copy of the information contained on the LAIS Site for your use as a broker/dealer. Any other use by you of the Intelligence System and the information contained on the LAIS Site these Terms of Use is strictly prohibited. Without limiting the preceding sentence, you will not: · Engage in or permit any reproduction, copying, translation, modification, adaptation, creation of derivative works from, distribution, transmission, transfer, republication, compilation or decompilation, reverse engineering, display, removal or deletion of the Intelligence System, any portion thereof, or any data, content or information provided by us or any of our third-party sources in any form, media or technology now existing or hereafter developed, that is not specifically authorized under these Terms of Use.

· Remove, obscure or alter any notice, disclaimer or other disclosure affixed to or contained within the Intelligence System, including any copyright notice, trademark and other proprietary rights notices and any legal notices regarding the data, content or information provided through the Intelligence System.

· Create a hyperlink to, frame or use framing techniques to enclose any information found anywhere on the LAIS Site without our express prior written consent.

· Impersonate any person, or falsely state or otherwise misrepresent his or her affiliation with any person in connection with any use of the Intelligence System.

· Breach or attempt to breach the security of the Intelligence System or any network, servers, data, or computers or other hardware relating to or used in connection with the Intelligence System; nor (b) use or distribute through the Intelligence System software or other tools or devices designed to interfere with or compromise the privacy, security or use of the Intelligence System by others or the operations or assets of any person.

· Violate any applicable law, including, without limitation, any state federal securities laws. 5. Your Representations and Warranties. You hereby represent and warrant to us, for our benefit, as of the time of these Terms of Use and for so long as you continue to use the Intelligence System, that (a) you are, and will continue to be, in compliance with these Terms of Use and any applicable laws and (b) you are authorized to provide to us the information we collect, as described in our Privacy Policy.

6. Disclaimer of Warranties.

· General Disclaimers.

THE INTELLIGENCE SYSTEM, THE LAIS SITE AND ALL DATA, INFORMATION AND CONTENT ON THE LAIS SITE ARE PROVIDED "AS IS" AND “AS AVAILABLE” AND WITHOUT ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND. WITHOUT LIMITING THE PRECEDING SENTENCE, LORD ABBETT, ITS AFFILIATES, AGENTS, THIRD-PARTY SUPPLIERS AND LICENSORS, AND THEIR RESPECTIVE EMPLOYEES, CONTRACTORS, DIRECTORS, OFFICERS AND SHAREHOLDERS (COLLECTIVELY, THE “LORD ABBETT GROUP”) EXPRESSLY DISCLAIM ALL WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING THE WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, AND NONINFRINGEMENT. YOU EXPRESSLY AGREE THAT YOUR USE OF THE LAIS SITE, THE INTELLIGENCE SYSTEM, AND THE DATA, INFORMATION AND CONTENT PRESENTED THERE ARE AT YOUR SOLE RISK AND THAT THE LORD ABBETT GROUP WILL NOT BE RESPONSIBLE FOR ANY (A) ERRORS OR INACCURACIES IN THE DATA, CONTENT AND INFORMATION ON THE LAIS SITE AND THE INTELLIGENCE SYSTEM OR (B) ANY TERMINATION, SUSPENSION, INTERRUPTION OF SERVICES, OR DELAYS IN THE OPERATION OF THE LAIS SITE OR THE INTELLIGENCE SYSTEM.

· Disclaimer Regarding Investment Research.

THE INTELLIGENCE SYSTEM INCORPORATES DATA, CONTENT AND INFORMATION FROM VARIOUS SOURCES THAT WE BELIEVE TO BE ACCURATE AND RELIABLE. HOWEVER, THE LORD ABBETT GROUP MAKES NO CLAIMS, REPRESENTATIONS OR WARRANTIES AS TO THE ACCURACY, TIMELINESS, COMPLETENESS OR TRUTHFULNESS OF SUCH DATA, CONTENT AND INFORMATION. YOU EXPRESSLY AGREE THAT YOU ARE RESPONSIBLE FOR INDEPENDENTLY VERIFYING YOUR INVESTMENT RESEARCH PRIOR TO FORMING YOUR INVESTMENT DECISIONS OR RENDERING INVESTMENT ADVICE. THE LORD ABBETT GROUP WILL NOT BE LIABLE FOR ANY INVESTMENT DECISION MADE BY YOU OR ANY OTHER PERSON BASED UPON THE DATA, CONTENT AND INFORMATION PROVIDED THROUGH THE INTELLIGENCE SYSTEM OR ON THE LAIS SITE.

· Survival.

THIS SECTION 6 SHALL SURVIVE ANY TERMINATION OF THESE TERMS OF USE OR YOUR USE OF THE INTELLIGENCE SYSTEM..

7. Limitations on Liability.

NONE OF THE MEMBERS OF THE LORD ABBETT GROUP WILL BE LIABLE TO YOU OR ANY OTHER PERSON FOR ANY DIRECT, INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE, SPECIAL OR EXEMPLARY DAMAGES (INCLUDING LOSS OF PROFITS, LOSS OF USE, TRANSACTION LOSSES, OPPORTUNITY COSTS, LOSS OF DATA, OR INTERRUPTION OF BUSINESS) RESULTING FROM, ARISING OUT OF OR IN ANY WAY RELATING TO THE INTELLIGENCE SYSTEM, THE LAIS SITE OR YOUR USE THEREOF, EVEN IF THE LORD ABBETT GROUP HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS SECTION 7 WILL SURVIVE ANY TERMINATION OF THESE TERMS OF USE OR YOUR USE OF THE INTELLIGENCE SYSTEM.

8. Miscellaneous Provisions.

· Governing Law. This Agreement will governed by and construed in accordance with the laws of the State of New York, without giving effect to applicable conflicts of law principles.

THE UNIFORM COMPUTER INFORMATION TRANSACTIONS ACT OR ANY VERSION THEREOF, ADOPTED BY ANY STATE, IN ANY FORM ("UCITA") WILL NOT APPLY TO THESE TERMS OF USE. TO THE EXTENT THAT UCITA IS APPLICABLE, THE PARTIES HEREBY AGREE TO OPT OUT OF THE APPLICABILITY OF UCITA PURSUANT TO THE OPT-OUT PROVISION(S) CONTAINED THEREIN.

The Intelligence System is not intended to be used by consumers, nor are the consumer protection laws of any jurisdiction intended to apply to the Intelligence System. You agree to initiate and maintain any action, suit or proceeding relating to these Terms of Use or arising out of the use of the Intelligence System exclusively in the courts, state and federal, located in or having jurisdiction over New York County, New York.

YOU HEREBY CONSENT TO THE PERSONAL JURISDICTION AND VENUE OF THE COURTS, STATE AND FEDERAL, LOCATED IN OR HAVING JURISDICTION OVER NEW YORK COUNTY, NEW YORK. YOU AGREE THAT YOU WILL NOT OBJECT TO A PROCEEDING BROUGHT IN YOUR LOCAL JURISDICTION TO ENFORCE AN ORDER OR JUDGMENT OBTAINED IN NEW YORK.

· Relationship of Parties. The parties to these Terms of Use are independent contractors and nothing in these Terms of Use will be construed as creating an employment relationship, joint venture, partnership, agency or fiduciary relationship between the parties.

· Notice. All notices provided under these Terms of Use will be in writing and will be deemed effective: (a) when delivered personally, (b) when received by electronic delivery, (c) one business day after deposit with a commercial overnight carrier specifying next day delivery, with written verification of receipt, or (d) three business days after having been sent by registered or certified mail, return receipt requested. We will only accept notices from you in English and by conventional mail addressed to: General Counsel Lord, Abbett & Co. 90 Hudson Street Jersey City, N.J. 07302-3973 We may give you notice by conventional mail or electronic mail addressed to the last mail or electronic mail address transmitted by you to us.

· Third-Party Beneficiaries. The members of the Lord Abbett Group are third-party beneficiaries of the rights and benefits provided to us under these Terms of Use. You understand and agree that any right or benefit available to us or any member of the Lord Abbett Group hereunder will also be deemed to accrue to the benefit of, and may be exercised directly by, any member of the Lord Abbett Group to the extent applicable.

· Survival. This Section 8 will survive any termination of these Terms of Use or your use of the Intelligence System. The undersigned hereby signs these Terms of Use. By electronically signing and clicking "Accept" below, these Terms of Use will be legally binding on me. To sign these Terms of Use, confirm your full name and enter your User ID and Password (as your electronic signature) in the fields indicated below and click the “I Accept” button.

 

Economic Insights

The Federal Reserve is right on schedule by taking its time—not too fast, not too slow.

Philadelphia Federal Reserve Bank president Charles Plosser has, it seems, become the leading hawk on the Federal Reserve Open Market Committee (FOMC). Since the FOMC sets the nation’s monetary policy, people pay close attention. And he has frightened many of late, saying, according to some popular interpretations, that the Federal Reserve will have to get going with unwinding its extremely easy monetary policy and raise interest rates sooner and perhaps more dramatically than is generally expected. But these fears are largely misplaced. Plosser is neither as radical as he seems in some media reports nor is the inflation situation such that it will likely move him or the rest of the FOMC to shift policy dramatically.

Plosser Ain’t That Far Out
Plosser has been described as the “north pole of hawks on inflation.” At that, it is easy to see why traders fear his influence. But if his rhetoric has a hawkish tone, what he says is not all that different from Chairperson Janet Yellen or the rest of the FOMC for that matter. Nor has he ever advocated a sudden change in policy.

To be sure, throughout the entire period of extreme monetary ease, he has consistently sounded a cautionary note on inflation potentials. He was issuing such warnings as far back in 2011. But alerting his fellow policymakers and the investment community to longer-term risks is entirely different from advocating an immediate, radical policy change. Indeed, at no point did he say that the Fed should tighten immediately. He objected to the second and third phases of quantitative easing because he worried over the long-term consequences of enlarging the Fed’s balance sheet and the difficulties that would impose when it came time for the Fed to change course. But his was a dispute over technique, not the immediate direction of policy.

Even his most recent statements suggest nothing about a sudden shift at the Fed. In, for instance, his June 24th talk to the Economic Club of New York, he mentioned the risk of inflation, but he couched it as a risk not a likelihood. He spoke less of the immediate future than in terms of “three to four years.”1 That hardly contradicts Yellen’s indication of no rate increase until 2015. Also like Yellen and many others at the Fed, Plosser insists that any change in monetary policy will hinge on unfolding economic events. As he has made clear, he would wait to raise rates above today’s near-zero levels until unemployment drops considerably more and fundamental inflation trends run at or above 2% a year. This is little different than the general Fed line. He has said that the Fed will probably move on rates “sooner than people think,”2 but that is more a response to his reading of market expectations than a statement that things will change tomorrow. Plosser senses that traders expect rates to stay low indefinitely. He wants them to know this expectation is misplaced. In this regard, too, he is little different from Yellen or former Fed chairman Ben Bernanke before her, both of whom have issued the same message through in slightly less strident language. As with them, it also is worth noting that Plosser’s warning says nothing about a rate increase tomorrow or even before 2015 for that matter.3

Inflation Aggregates Hardly Flash Danger Signals
Recent readings of the Consumer Price Index (CPI) might raise inflation concerns. So far this year, the overall measure, which includes food and fuel, has risen at a 2.7% annual rate. If there were reason to expect such a pace to last, it would indeed be worrisome and would also challenge the Fed to alter policy soon. But that is hardly the case. The spring acceleration in overall inflation had its roots in clearly temporary surges on fuel and food prices. None of these are likely to continue at their recent pace. Both sorts of prices have, in fact, already begun to moderate. Still, more compelling is the moderate underlying trend. The Labor Department reports that the overall CPI rose 2.0% over the past 12 months, right at the Fed’s preferred level and slightly lower than the previous 12 months.4     

The Fed’s preferred inflation measure, the personal consumption deflator, offers an even less worrisome picture than that painted by the CPI. According to the Commerce Department, which collects and records the data, this index has increased so far this year at a slightly slower rate than the CPI, advancing at a 1.9% annual rate, pushed up, like the CPI, by temporary surges in food and fuel prices. A measure that excludes the effects of food and fuel pricing showed a more modest rate of increase during the two months. Longer-term trends leave even less sign of the kind of inflationary pressure Plosser and other Fed policy hawks fear. Over the past 12 months, the overall consumer price deflator increased only 1.7%, well under the Fed’s 2.0% preferred rate, and a measure that excludes the effect of food and fuel increased only 1.4%.5 Neither is a cause for concern.

Nor Do Commodity Prices Give Much Cause for Concern
Commodity prices, often identified as an early warning of a generalized inflation, give a mixed picture. They always do. On balance, they, too, hardly point to an imminent takeoff in inflation.

Most concerning when it comes to inflation are oil prices. According to the New York Mercantile Exchange, the price of a barrel rose from about $92 at the start of the year to a high of $107 earlier in July, a 16% increase.6 The jump reflected the basics of supply and demand less than the fears engendered by geopolitical tensions in Ukraine and in Iraq (See Economic Insights, July 21.) If these matters get out of hand, oil prices could rise higher, but if supplies from Russia and the Persian Gulf continue to flow, as they have, then prices could easily fall back to where they started this year or even lower. Indeed, largely because these situations seemed to have stabilized or, at the very least, not deteriorated any further, oil prices during the past few weeks have dropped back down below $102 a barrel, a 13% drop from their highs. An inflationary momentum from this source depends on a serious deterioration in the geopolitical situation, which, though possible, is hardly a basis on which to change monetary policy, certainly not preemptively.

The other source of inflationary concern is meat prices. So far this year, they have risen at an astronomical rate.  According to the Chicago Merchantile Exchange, feeder cattle, for instance, jumped almost 28% from year-end 2013 to highs earlier this spring. Lean hog prices rose more than 30% during this time. But promising future relief, wheat prices (after rising some 23% from the start of the year to April) have fallen steeply since then, so that prices year to date are actually down more than 7%. Corn prices have followed a still more dramatic pattern, shooting up and then turning down, falling year to date on balance by just less than 17%. And, indeed, meat prices already have begun to moderate. Feeder cattle and lean hog prices have each dropped about 3% during the last couple of weeks.7

Meanwhile, other commodity prices look reasonably moderate. Gold prices, often seen as a proxy for general expectations on inflation, have risen so far this year, gaining about 12%. But they remain more than 25% below their highs of late 2012. And gold is already off 2.0% since hitting recent highs earlier this spring. Industrial price indicators also offer a moderate picture. Copper prices, for instance, after falling with the weather-induced economic slowdown earlier in the year, have risen again more recently. They nonetheless remain below the levels at which they began the year. Lumber prices have followed a similar down and up pattern, but at present they remain more than 8.0% below the levels at which they began the year. The Dow Jones-UBS Overall Commodity Index, though up about 5.0% so far this year, has already dropped from its recent highs.8

Nor Do Wage Patterns Raise Any Inflationary Flags
Wages, as Plosser is often at pains to explain, tend to lag. Still, they remain a crucial indicator of whether the Fed needs to worry about what economists call a wage-price spiral. This pattern, usually identified as the main source of any sustained inflationary momentum, is when wages rise to keep pace with expected inflation, forcing managements to pass through the costs in higher prices, causing those expectations to be realized, and, in the process, sustaining a general price advance. Here, too, there is little to no sign a dangerous inflationary pressure that might warrant an abrupt shift in monetary policy, including premature rate increases.

So for this year, the Labor Department reports, hourly earnings of all employees have risen 1.2%, or 2.5% at an annual rate. Weekly earnings have increased 1.7%, or 3.4% at an annual rate. In itself, these figures would hardly send up an inflationary flag. After all, productivity has grown about 1.0% during the past year and has trended up at an even faster rate, suggesting little cost pressure in these wage gains, certainly none in excess of the Fed’s inflation preference. What is more, these earnings gains would have come in even lower were it not for the relatively heavy use of overtime. There is no sign here of even the beginnings of a wage-price spiral that might force the Fed’s hand on policy. Nor is this year very different from the recent past. Over the last two years, hourly earnings have risen at a 2.1% annual rate and weekly earnings have increased at a 2.2% annual rate. After accounting for productivity advances, costs are rising at a pace well below the 2.0% informally targeted by the Fed.9

Different industries exhibit considerable variation in wage gains. That, of course, is always the case. But there is no sign of a widespread acceleration that might create concern about a wage price spiral. Just using broad measures can give an indication. Weekly earnings in goods producing industries have risen at a 2.6% annual rate during the past two years and at a 3.3% annual rate so far this year, a slight acceleration but hardly enough to warrant a policy shift, especially because manufacturing productivity increased 2.3% during the past year, taking most of the cost sting out of such earnings increases. In services, weekly earnings have risen at a 2.0% annual rate in the past two years and at a 3.5% annual rate so far this year. This acceleration, too, implies only modest cost pressures and no hint of a wage-price spiral. A further acceleration could raise legitimate concerns in this regard, but that is nowhere in the data, certainly not yet.10

Pulling the Pieces Together     
To be sure, past extreme monetary ease engenders concern of ultimate inflationary pressure. It is why Plosser attracts so much attention in the financial community. Many there share his fears. But for all the reasonableness of such thinking, clearly little or nothing in today’s statistics point to an immediate realization of such concerns, certainly not enough to justify a sudden change in monetary policy. But if there is no pressing need for the Fed to deviate from plan, Plosser’s policy warnings are right in principle. Ultimately, the Fed will need to move away from its policies of extreme ease. It will have to do so before the inflationary momentum builds. The decision to taper quantitative easing and to end the program this fall is a part of this plan. So, too, is the Fed’s decision to begin to raise interest rates gradually next year and then go on overtime to normalize the Fed’s posture and its balance sheet. But all of this, whether described by Plosser, Yellen, or even the monetary doves on the FOMC, should unfold very gradually and, as the economic situation seems to demand, no sooner than scheduled. 

 

ABOUT THE AUTHOR

Lord Abbett's Blog

 

videoOur blog, The Investment Conversation, features timely commentary and analysis from Lord Abbett experts. Join the conversation.

RELATED COMMENTARY