September 2017 Newsletter
Tax Policy, Class Struggle, Politics and Economics The broad layout of the new Republican tax plan is out. Don’t spend your time drilling down or getting excited about implications for 2017. John McCain lives. So too do far healthier Republican senators: Susan Collins, Rand Paul, and Lisa Murkowski. And no matter your political ilk, […]
November 2017 Newsletter
Heads up. There is a relationship between the value of stocks and interest rates. And, this relationship is probably different than you think. When yields on treasury bonds are extremely low, rising interest rates have a strong positive influence on stocks. As these yields move up toward 5% this relationship weakens. The chart below (Figure […]
October 2017 Newsletter
Be less anxious. While global growth has been tepid, during this period corporations have remained focused on lowering expenses and thereby enhancing returns to shareholders. Due to worldwide Quantitative Easing (QE), all G7 countries (U.S., U.K., France, Canada, Italy, Japan, and Germany) and BRIC countries (Brazil, Russia, India, and China) are experiencing economic expansions. This […]
Changing Investment Styles and the Economic Cycle
Changing Investment Styles and the Economic Cycle Monitoring the rate of change in the business cycle (ups and downs) is an important part of enhancing or reducing the risk of owning stocks. It’s what we spend hours doing daily in order to advance your account balances and preserve your capital. In the mature stage […]
Advanced Optimism and the Need for a Healthy Correction
Advanced Optimism and the Need for a Healthy Correction Has the market become too optimistic? The fact that analysts are asking this question suggests that fear of piling on has arrived. By short-term cycle standards, the market appears overdue for a healthy correction, though the current slow and healthy decline intimates a small correction. While […]
November 2016 Newsletter
In this report I discuss politics by way of economic research and tackle some of the asset class implications of a Trump or a Clinton victory. Do you hate me yet? Let’s begin with the bond market. Risk appears higher for the bond market heading into the post-election period for either candidate’s early administration as […]
August 2016 Newsletter
August 2016 Newsletter Fear and Promise and the Equity Risk Premium: 2016 Relax; that is, become less taut. A recent survey by Credit Suisse has found that investors are far too fearful. While the world is awash with many reasons to be fearful, the equities market continues to sport an equity risk premium of a […]
Late June 2016 Newsletter
Late June 2016 Newsletter Sometimes the equity research guys nail the bigger-issue: good news and bad news. At least that’s my attitude when they bring up a topic I’ve been talking about for eight years. As a precursor to what they have to say in the following paragraph, economies go through boom and bust cycles. […]
June 2016 Newsletter
June 2016 Newsletter Regarding the stock market: The roller coaster ride continues to be a tug-of-war between TINA, There Is No Alternative to stocks and bonds, which promise positive returns to people throughout the world used to negative interest rates (most all of Europe, and the Japanese) and American investors who remain lulled by decades […]
April 2016 Newsletter
April 2016 Newsletter The Ball is in the Fed’s Court Account values are up nicely after the S&P 500 experienced two 14% corrections over the last six months; this is something never witnessed before. The S&P 500 snapped back each time and S&P 500 valuations have now been tested twice. This could produce a more […]