Trees Don’t Grow to the Sky We lead off this week with a confession. What follows is not original. We are paraphrasing a terrific report that came from the Federal Reserve earlier this month, titled “The coming long-run slowdown in corporate profit growth and stock returns”. The report very clearly highlights the longer-term impact of […]
Do you Believe in Miracles? We just completed the worst first half stock performance since 1970. (See chart below.) To make matters worse, rates increased and bonds were also hit extremely hard. The result was that the ‘standard’ 60/40 portfolio (60% S&P 500 /40% Aggregate Bond Index) declined a record 16.1% in the first half. […]
Stepping Back Stocks are expensive and inflation combined with low rates increases risk in bond portfolios. We’ve been spoiled by unusually high returns for a long time. It’s time to temper expectations. Alternative Investments can help manage risk and produce reasonable returns. It’s very easy to get caught up in the day-to-day, week-to-week action in […]
Stocks Remain A Prisoner of Interest Rates The stock market is following the bond market like a puppy. Rates down? Buy growth stocks. Rates up? Buy reflation stocks. U.S. growth estimates are rising, but they are falling in other developed markets. Unless something changes, rates are probably going nowhere. The economic experience in the U.S. […]
Does the Financial News Have You Confused? Here is a Simplification. Today’s world of instant and constant information can easily put us in a position where we can’t see the forest for the trees. Stepping back from the constant barrage of seemingly conflicting financial data points and focusing on the ‘forest’ can be an enlightening […]
