Are we poised to relive the economic malaise of the 1970s and early-1980s? Inflation emerged as the primary concern for the markets during the second quarter. The Consumer Price Index (CPI) reached 8.6% in May, putting to rest any remaining hope that the inflationary pressures of the past year were “transitory.” While there are parallels … Continue reading Stagflation Redux?
Why are markets so volatile even though the Federal Reserve telegraphed their interest rate stance? Under the leadership of Chairman Jerome Powell, today’s Federal Reserve Board was supposed to be different than boards of the past. Although the Fed’s dual mandate continues to be maximum sustainable employment and stable prices, a goal of this board … Continue reading Is the Federal Reserve to Blame for the Recent Market Volatility?
The consensus seems to feel Chinese equities are uninvestable. Read why the herd could be wrong. The year was 2019. Chinese equities were in the middle of a strong year. Nearly half of the world’s largest technology companies by market capitalization were based in China. The Chinese government was on a mission to catch then … Continue reading The Great Fall of China
Where are the superior risk/rewards in this sensitive economy? Many investments have more than doubled since their pandemic lows. However, the U.S. equities market is in an interesting position as we enter the fourth quarter. Due to the sizable disruptions caused by the Delta variant and ongoing global supply chain issues, global markets have become … Continue reading Buy Economically Sensitive for a Sensitive Economy
It’s December 31st, 2019 and financial markets around the world just capped off one of the best years on record. At that time, if someone had told you we were on the cusp of one of the worst global health crises of all time – one that would all but cause the global economy to … Continue reading The Resiliency of Markets and Mankind
The financial media has recently begun to focus on the ongoing rotation from U.S. growth stocks to U.S. value stocks. Specifically, a rotation out of high valuation, momentum growth companies. It’s interesting to note this rotation actually began to occur quietly in September – something we’ve been anticipating for a number of months now. In … Continue reading The Rotation from Growth to Value
As 2020 begins, the year may change, but human nature does not. Humans evolve and refine their thinking, yet common cognitive biases remain. This is especially true when markets are near lows or, as the new decade begins, near highs. We believe enhancing awareness of these biases can improve long-term portfolio performance. So let’s take … Continue reading FOMO – Battling Biases in 2020 and Beyond
Signs of economic weakness are pervasive. Quantitative evidence from economic reports is depicting an obvious economic slowdown. Additionally, qualitative evidence, such as “expert” commentary and recession related media headlines, means the average American hears about an upcoming recession daily. After reading the headlines of poor economic reports and bearish commentary, one would expect equity markets … Continue reading The Bull Stock Market in the Bear Economy
Click here to view a PRINT VERSION of this article. Historically, two sectors with consistently slow earnings growth have been utilities and consumer staples. Over the long-term, these two sectors have posted annualized earnings growth of 3% and 5% respectively, below the S&P 500’s 7% earnings growth. Although earnings growth has been slower, and these … Continue reading Safe Is Not Safe Anymore
The old saying “stock prices follow earnings” was not in effect during 2018. The S&P 500 delivered outstanding earnings growth of 22% during the year. However, this impressive earnings growth coincided with the worst performance for the S&P 500 in over 10 years, along with one of the worst single quarters since 1940. Practically overnight, … Continue reading What Does the Recent US Stock Market Action Mean for 2019?
