Should We Be Alarmed? Suppose somebody came up to you and shouted: “I have terrible news about the economy. I think you should sell your stocks!” Alarmed, you say: “Oh, my God. Tell me more!” And this mysterious stranger shouts: “Run for the hills! The American economy just added 200,000 more jobs—more than expectations—and the […]
Downturn for What? On Tuesday morning, Wall Street traders woke up to something they haven’t experienced much of lately: actual market volatility. One trader posted an image of his Bloomberg terminal at the market opening (re-posted here), which showed an immediate scary-looking plunge in U.S. equities as the opening bell rung. By the end of […]
False Visions of the Future The financial experts know a lot more about the markets and how the markets will perform in the future than the ordinary rest of us. Right? As it turns out, the predictions made by financial experts are no better than those made by gypsies looking into crystal balls, soothsayers gazing […]
Eerily Quiet on the Market Front While the U.S. stock market tests new highs, and valuations keep rising farther above long-term averages, you may not have noticed something very odd about our current bull market. The last six and a half years have set a record for lowest market volatility, and the past 299 trading […]
When the Index Beats the Algorithms You might wonder why there wasn’t more media coverage of one of the most interest bets ever made in the investment world. We’re not talking about betting on a company; this bet was made between Berkshire Hathaway chairman Warren Buffet and a hedge fund called Protégé Partners, on whether […]
False Positive? We’ve all heard about as much as we can take about the U.S. Fed’s multi-part QE program, and similar stimulus programs instituted by the European Central Bank. What they mostly have in common is the purchase of government and certain mortgage-backed bonds on the world markets, which has the effect of holding down […]
Why Rebalance? You probably know that your investment portfolio is being rebalanced on a regular basis, but you might not know why. Is it for higher returns? For maintaining the agreed-upon balance of investments that is in your risk tolerance comfort zone? Does rebalancing help manage portfolio risk? The answer to the above is “yes,” […]
One of the oddities of a significant bull market—and this one we’re in today qualifies, as the second-longest in modern American history—is that they tend to go on longer than you might expect from the pure market fundamentals. The last leg of a bull market tends to be driven by psychology; people have recently experienced […]
It is probably not a good sign for an investment when its largest clearing firm takes out an advertisement in the Wall Street Journal asking for more regulatory oversight and warning investors that its investment category is so volatile that futures contracts could create devastating losses. Yet this is exactly what has happened recently when […]
2017 Third Quarter Report The last few years of a bull market are always a bit of a mystery to professional investors; the market rises faster than it did in the early, cautious years when nobody believed there WAS a bull market, even though there appear to be fewer fundamental or economic reasons for […]
