ACTIONABLE ADVICE FOR FINANCIAL ADVISORS: Newsletters and Commentaries Focused on Investment Strategy

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2015-03-29 ECRI Recession Watch: Weekly Update by Doug Short (Article)

Friday's release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 131.6, up slightly from 131.2 the previous week. The WLI annualized growth indicator (WLIg) is at -3.2, up from the previous week's -3.6 and off its interim low of -4.9 in mid-January.

2015-03-29 Weighing the Week Ahead: Time for an Economic Spring Thaw? by Jeff Miller of New Arc Investments

In the absence of real data it is easy and tempting to speculate. Unlike last week, the week ahead features an avalanche of data – more in both quantity and importance than we have seen in a month. With some recent significant reports showing economic improvement we expect a change of focus.

2015-03-29 US Equity Market Review For the Week of March 23-27; Hey, We're Still Consolidating, Edition by Hale Stewart of Hale Stewart

Writing about market consolidation is very difficult. There are no strong rallies, massive volume spikes or huge losses to get the reader excited. Instead, the entire analysis focuses on prices pin-balling between two trend lines, usually on decreasing volume and weakening technical indicators. So if you’re looking for an article the grabs your attention by telling a story of an incredibly strong surge in bullish price action, move elsewhere. Because this week we again have a market that is consolidating.

2015-03-29 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

The largely trend-less environment of the past four months continues. Despite the fall this week, US equities are not oversold and sentiment is still heady. This suggests that a rally early in the week would likely fail. While April is one of the best months of the year, the first half of the month has been weak. If this pattern continues this year, there would likely be a more attractive entry point mid-month.

2015-03-29 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

Friday's release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 131.6, up slightly from 131.2 the previous week. The WLI annualized growth indicator (WLIg) is at -3.2, up from the previous week's -3.6 and off its interim low of -4.9 in mid-January.

2015-03-28 World Markets Weekend Update by Doug Short (Article)

Only two of the eight indexes on my world market watch, list posted a weekly gain. The top performing Shanghai Composite rose 2.04%, with Hong Kong's Hang Seng as a distant second at 0.46%. The losses of the other six indexes ranged from -1.05% to -2.84%, with the average of the eight at -1.10%, the worst since the -1.21% at the end of January.

2015-03-28 International Equity Commentary: February 2015 by Team of Thomas White International

International equity prices gained during February on expectations that the central banks in Europe and Japan would continue their quantitative easing programs, while the U.S. Federal Reserve could possibly delay its interest rate hikes. At the same time, economic trends from most major economies remained relatively stable. After two quarters of robust gains, the U.S. economy expanded at a slower pace during the fourth quarter of 2014, as expected.

2015-03-28 Living in a Free-Lunch World by John Mauldin of Mauldin Economics

I believe the fundamental imbalances we are seeing in the world (highlighted in the two papers mentioned above) are the result of the massive increases in global debt and misunderstandings about the use and consequences of debt. Too much of the wrong kind of debt is going to be the central cause of the next investment crisis.

2015-03-27 Michigan Consumer Sentiment at 93.0, An Improvement from the March Preliminary by Doug Short (Article)

The University of Michigan final Consumer Sentiment for March came in at 93.0, up from the 91.2 March preliminary reading but down from the final reading of 95.4 in February and the 98.1 level in January. had forecast 92.0 for the March final.

2015-03-27 S&P 500 Snapshot: Selloff Ends with a Modest Gain by Doug Short (Article)

Friday was a mixed bag of economic data. Hopes for an upward revision to Third Estimate of Q4 GDP were disappointed when the BEA left the annualized rate at 2.2%. The Michigan final Consumer Sentiment for March was an improvement on the preliminary reading, but it was below the February final and well off the January 11-year high. The S&P 500 spent the day in a narrow range, ending with a modest 0.24% gain, which snapped a four-day selloff. The index was down 2.33% for the week, its second worst weekly performance of 2015 (the worst being the -2.77% plunge in late January).

2015-03-27 Liquidity by Howard Marks of Oaktree Capital Management

My wife Nancy’s accusations of repetitiveness notwithstanding, once in a while I think of something about which I haven’t written much. Liquidity is one of those things. I’m not sure it’s a profound topic, and perhaps my observations won’t be either. But I think it’s worth a memo.

2015-03-27 Q4 GDP Third Estimate Remains Unchanged at 2.2% by Doug Short (Article)

The Third Estimate for Q4 GDP, to one decimal, came in at 2.2 percent, unchanged from the Second Estimate. Today's number was a minor disappointment for most economic forecasts, which were looking for a somewhat higher Third Estimate.

Here is a log-scale chart of real GDP with an exponential regression, which helps us understand growth cycles since the 1947 inception of quarterly GDP. The latest number puts us 13.6% below trend. That is slightly off the 14.0% below in Q1 of 2014.

2015-03-27 Emerging Markets Equity Commentary: February 2015 by Team of Thomas White International

Emerging Market Equities Emerging market equity prices advanced during the month of February on signs of improvement in global economic trends as well as expectations about quantitative easing in Europe and Japan. Encouraged by reduced inflation risks after the oil price decline, some of the emerging market central banks have also lowered interest rates in recent months.

2015-03-27 Global Economic Outlook Involves More than Fed News by Andrew Pease of Russell Investments

Andrew Pease outlines the key economic outlook points and key watch points going forward.

2015-03-27 Enjoying the Shade by Patricia Huang and The Matthews Asia Investment Team of Matthews Asia

As commentator Cherian George has said: “The legacy passed down to today’s Singaporeans isn’t one of random opportunism…There is nothing accidental about it.” Singapore’s first prime minister, Lee Kuan Yew, took charge of the city-state, transformed and drove it forward in the span of just a few decades. This week Matthews Asia pays tribute to this “giant of history.”

2015-03-27 Woe Betide the Value Investor by Jason Hsu, Vivek Viswanathan of Research Affiliates

The excess return earned by the average investor in value mutual funds was meaningfully negative over a 23-year period when the funds themselves outperformed the market. Why don’t all value investors benefit from the value premium?

2015-03-27 Are Equities Overvalued? by Michael Spence of Project Syndicate

Since the global economic crisis, sharp divergences in economic performance have contributed to significant stock-market volatility. Now, stocks are reaching relatively high levels by conventional measures – and it is difficult to discern precisely why.

2015-03-27 In a Challenging Environment, Policy Easing Sweeps Through Asia by Adam Bowe, Tomoya Masanao, Isaac Meng of PIMCO

The key change to our cyclical outlook for Asia: We have further downgraded our growth forecast for China to the low-6% range as real borrowing rates remain elevated. In Japan, we expect growth to recover from last year's technical recession, following the delay in the next value-added tax (VAT) hike and the increase in the Bank of Japan's easing program.

2015-03-27 Global Asset Allocation Shifts by Alexander Giryavets of Dynamika Capital L.L.C.

A couple of days ago BIS (Bank of International Settlements) released a seminal research piece “Global Asset Allocation Shifts” in which authors explain that weekly institutional and retail portfolio reallocations (not just fund flows) of U.S. investors are 90% driven by two factors easily identified as Yen (Risk On/Off) and Dollar factors hence reaffirming our Global Macro Framework. They also explore systematic predictability of these factors in great details.

2015-03-27 A Deeper Look at Smart Beta in Fixed Income by Sara Shores of BlackRock

While most tend to think of smart beta as a tool for stock portfolios, there are ways to apply it to bonds. Sara Shores shares a smart beta approach to balancing interest rate and credit risk.

2015-03-27 Japanese 10-Year Rates Double in 2015, Rise Above German Bunds by Bradley Krom of WisdomTree

Since reaching historic lows in mid-January, Japanese government bond (JGB)yields have doubled over the last several weeks. In the process, they have eclipsed German 10-year bund yields for the first time in over 20 years.

2015-03-27 A Tale of Two Economies: Singapore and Cuba by Frank Holmes of U.S. Global Investors

It would be nearly impossible to find two world leaders in living memory whose influence is more inextricably linked to the countries they presided over than Cuba’s Fidel Castro and Singapore’s Lee Kuan Yew, who passed away this Monday at the age of 91.

2015-03-27 REITs in a Rising Interest-Rate Environment by Wilson Magee of Franklin Templeton Investments

Wilson Magee, director of global real estate and infrastructure securities, Franklin Real Asset Advisors®, believes this environment is causing many investors to search for alternative investments that can add an income-oriented asset to their portfolio as well as gain exposure to global economic growth potential. He outlines why he thinks it’s an opportune time for many investors to consider diversifying into global real estate through an actively managed investment vehicle.

2015-03-27 Growth Expectations Are No Longer Cratering For Energy Stocks by Team of GaveKal Capital

Sales and earning growth expectations for energy stocks are still pretty awful for the next fiscal year (FY1). Sales are expected to drop by 17% and earnings by a whopping -29%. However, earnings are expected to make a V-shaped rebound. Analysts expect sales to grow by an average of 12.3% per year over the next three years (FY2-FY4). The rebound in earnings is expected to be even stronger. Earnings are expected to grow by an average of 32.5% per year over the following three years (FY2-FY4). These expectations are setting a high bar for the energy sector for 2016-2018.

2015-03-27 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

After Slow Start, the U.S. Should Regain Steam; Greece: The Debt Elephant in the Room; How Can Governments Keep Borrowing Under Control?

2015-03-27 The Monetary Illusion by Scott Minerd of Guggenheim Partners

The long-term consequences of global QE are likely to permanently impair living standards for generations to come while creating a false illusion of reviving prosperity.

2015-03-27 Will a Spring Thaw Lead to a Stock Surge? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

US economic data has been soft, repeating a trend we’ve seen in recent first quarters. But we believe growth will again bounce back as some of the temporary weights drop off. US stocks should continue to grind generally higher—but with heightened volatility—aided by better data and a still-dovish Federal Reserve. But investors shouldn’t ignore international opportunities. Global growth generally appears to be improving and foreign central banks are largely easing monetary policy, potentially benefiting risk assets.

2015-03-27 Deglobalization Redraws the Investment Map by Hayden Briscoe and Vincent Tsui of AllianceBernstein

Divergence between economies and financial markets has been a key macroeconomic trend over the last few years, and reflects in part the deglobalization of the worldwide supply chain. We expect the big winners to be countries and regions with large internal markets; the losers will be smaller countries which have yet to move up the export value chain.

2015-03-27 In US Small-Caps, Quality Is on Sale by James MacGregor of AllianceBernstein

Investors who wanted safety and certainty last year mostly shunned smaller-cap US stocks. As a result, many high-quality names are now on sale. With US growth likely to accelerate in 2015, we think these domestically oriented smaller-cap companies may turn out to be a real bargain.

2015-03-27 Median Household Income Up Slightly in February by Doug Short (Article)

Summary: The Sentier Research monthly median household income data series is now available for February. The nominal median household income was up $178 month-over-month and up $1,409 year-over-year. That's a 0.3% MoM gain and 2.7% YoY. Adjusted for inflation, the numbers were up $60 MoM and $1447 YoY. The real numbers equate to a 0.1% monthly increase and a 2.7% yearly increase.

2015-03-26 New Jobless Claims at 282K, Better than Forecast by Doug Short (Article)

Today's seasonally adjusted 282K beat the forecast of 290K. The four-week moving average at 297,000 is now 18,000 above its 14-year interim low set in early November of last year.

Here is a close look at the data over the past few years (with a callout for the past year), which gives a clearer sense of the overall trend in relation to the last recession and the volatility in recent months.

2015-03-26 Gasoline Volume Sales, Demographics and our Changing Culture by Doug Short (Article)

The Department of Energy's Energy Information Administration (EIA) data on volume sales is over two months old when it released. The latest numbers, through mid-January, are now available. However, despite the lag, this report offers an interesting perspective on fascinating aspects of the US economy. Gasoline prices and increases in fuel efficiency are important factors, but there are also some significant demographic and cultural dynamics in this data series.

2015-03-26 OFR: Assessing The Risk Of Overvalued Markets by Lance Roberts of Streettalk Live

A Review Of The Office Of Financial Research report on valuation risks and consequences.

2015-03-26 The Relationship of Suds and Bubbles by Matt Lloyd of Advisors Asset Management

The proliferation of news, information, opinion and fact (which all come across in the same way) has had an overwhelming effect on the common investor and the instructional as well. Attempting to delineate the crowded trade from the minority viewpoint is a far greater task currently. Though this increased dissemination of information is beyond the recognition of the investor’s psyche, it does have a more pronounced positive impact.

2015-03-26 Investment Times Are A Changin’: New Landscape and New Approaches by David Robertson of Arete Asset Management

Significant changes over the past 30-40 years make it very likely the next 30-40 will be very different than the last. Investors who are able to discard old assumptions and adapt to the new environment will be best suited to succeed and those who can’t or won’t will struggle. One thing that will have to change is that investors will need better access to high level investment expertise.

2015-03-26 Global Economic Overview: February 2015 by Team of Thomas White International

The global economic outlook improved in February, helped by encouraging data from some of the largest countries as well as supportive monetary policy measures. Monthly job additions in the U.S. exceeded expectations in February, continuing the robust trend from last year. Though wages are yet to see meaningful growth, the strengthening labor market should help the U.S. economy sustain the current pace of expansion.

2015-03-26 Dove or Ivory? A Case Study on Currency Impacts by Jeremy Schwartz of WisdomTree

Given the divergence of central bank policies, currencies are among the most important investment topics today. If the U.S. dollar continues to strengthen, it may be a headwind to U.S. multinationals earning revenue abroad, while boosting foreign companies that are earning revenue in the United States.

2015-03-26 Latin America Is Blowing Up Your EM ETF Performance by Team of GaveKal Capital

On an equal-weighted, USD basis, the MSCI Emerging Markets Index is up just 0.99% YTD compared to MSCI World Index which is up 5.65%. So is this just a simple continuation of the trend of emerging market underperformance that has been in place over the last 4 years ? Yes, but with a caveat.

2015-03-26 The Labor Market Conundrum: The Cyclical and the Secular by Russ Koesterich of BlackRock

Low workforce participation and slow wage growth are structural issues that the strengthening U.S. labor market must overcome in the long run.

2015-03-26 Why This Airline Just Landed in the S&P 500 Index by Frank Holmes of U.S. Global Investors

For the first time in its 84-year history, American Airlines was cleared for landing in the S&P 500 Index.

2015-03-26 Breaking Up is Hard to Do by Anthony Valeri of LPL Financial

The high-yield energy sector has kept pace with the broader high-yield bond market in 2015 even as oil prices weakened, a notable difference from 2014. Although we don’t believe the high-yield bond market will return to the June 2014 peak, the current yield spread may still represent good value given still strong corporate fundamentals and low defaults.

2015-03-26 Data Dependence, Broadly Defined - Implications of Last Week’s Fed Meeting by Zach Pandl of Columbia Management

At last week’s meeting, the FOMC made a widely-anticipated but nonetheless important change to the statement, dropping a commitment to be “patient” and thereby creating the option to hike rates at any meeting after April. In the end, this proved to be a sideshow to the more interesting changes in the Fed’s Summary of Economic Projections (SEP)—the forecasts officials’ provide at every other FOMC meeting.

2015-03-26 Rates and Bonds by Heather Rupp of AdvisorShares

So at long last we know whether the word “patient” stays or goes: it’s gone and Treasury yields have actually declined as a result. So far this year we have seen rates go from a 2015 low of 1.19% on the 5-year and 1.68% on the 10-year on February 2nd, and then spike a month later at 1.70% and 2.24%, respectively, on March 6th. So an over 50bps move in a month all over the worry about the word “patient” and whether rates will rise as early as June. Only for rates to fall after the statement was released and the key word removed.

2015-03-25 February Durable Goods Plunge by Doug Short (Article)

The March Advance Report on February Durable Goods released today by the Census Bureau was quite disappointing. Here is the Bureau's summary on new orders:

New orders for manufactured durable goods in February decreased $3.2 billion or 1.4 percent to $231.3 billion, the U.S. Census Bureau announced today. This decrease, down three of the last four months, followed a 2.0 percent January increase. Excluding transportation, new orders decreased 0.4 percent. Excluding defense, new orders decreased 1.0 percent.

2015-03-25 The "Real" Goods on the Latest Durable Goods Data by Doug Short (Article)

Earlier today the Census Bureau posted the Advance Report on February Durable Goods New Orders. This series dates from 1992 and is not adjusted for either population growth or inflation.

Let's now review Durable Goods data with two adjustments. In the charts below the red line shows the goods orders divided by the Census Bureau's monthly population data, giving us durable goods orders per capita.

2015-03-25 The Dollar Isn't the Peso Anymore (Part II) by Richard Bernstein of Eaton Vance

In May 2013, Richard wrote a report titled “The Dollar isn’t the Peso anymore.” He rebutted the argument that the U.S. dollar (USD) was weak. The data showed that the USD had actually troughed in the spring of 2008. For seven years now, the USD has been gaining strength and is today a standout among the world’s currencies.

2015-03-25 US Economy Badly Disappoints Analysts' Expectations by Gary Halbert of Halbert Wealth Management

Today we will talk about an economic indicator that I have not written about before, which is compiled and reported monthly by CitiGroup, the American multinational banking and financial services corporation headquartered in Manhattan.

2015-03-25 Five Reasons Why Interest Rates Will Stay Low by Jerry Wagner of Flexible Plan Investments

Last week we focused on investors’ waiting game with the Federal Reserve. Would their policy statement following last Wednesday’s meeting, like last month’s Groundhog Day sighting, suggest more weeks of winter in the form of rising interest rates?

2015-03-25 Silver and Gold: I Really Want to Look Up by Avi Gilburt of

For the last several weeks, I have provided you, and, sometimes even entertained you, with my perspective of a very evil pattern to play out in the metals. Such a pattern was supposed to test the 2014’s lows (and potentially even break them), and then rally to the 2015 highs to set up the final decline to the lower lows to end the 3+ year correction in silver.

2015-03-25 Can ECB Policy Heal Europe’s Ills? by Mike Amey, Andrew Bosomworth, Lorenzo Pagani of PIMCO

In this interview, Managing Directors Mike Amey, Andrew Bosomworth and Lorenzo Pagani discuss the conclusions from PIMCO’s quarterly Cyclical Forum in March 2015 and how they influence our European investment strategy. They also delve into the impact of the European Central Bank’s (ECB) balance sheet expansion on growth and inflation and reflect on Europe’s improving economic health.

2015-03-25 The Dollar's Ripple Effect by Burt White of LPL Financial

In technical analysis, “intermarket analysis” looks at the way in which various markets interact. Intermarket analysis primarily looks at four market sectors: currencies, commodities, bonds, and stocks. From a technical analyst’s perspective, focusing our attention on only one market without considering what’s happening in the others leaves us in danger of missing vital directional clues and potential profits. The dollar, which has appreciated 24.4% since June 30, 2014 (as of March 19, 2015), has had an unusually strong intermarket effect of late.

2015-03-25 Active vs. Passive Redux by Jeffrey Saut of Raymond James

Most of you know I spend my days gathering “thin reeds” and try to weave them into a favorable “investment bouquet.” As Yogi Berra said, “You can observe a lot by just watchin’!”

2015-03-25 Fed Policy Outlook - in *Retrograde? by Scott Brown of Raymond James

The question of whether the Fed would abandon the “patient” language should have not been an issue, but the financial press always tries to generate some level of tension. However, while the Federal Open Market Committee appeared to move closer to tightening monetary policy, it indirectly signaled that it would likely be much less aggressive.

2015-03-25 Signs of a Normalizing Market by Chris Clark of The Royce Funds

In the wake of the 2008 financial crisis, the Fed's monetary stimulus programs had the unintended effect of suspending the historically typical functioning of capital markets in terms of the productive and destructive uses of capital. Today, the fiscal climate is beginning to change. President and Co-Chief Investment Officer Chris Clark takes a look at what's happening in the current market and talks about why our discipline could be rewarded in the foreseeable future.

2015-03-25 The Big Four Economic Indicators: Real Retail Sales by Doug Short (Article)

Retail Sales fell again in February, down 0.58%, the third month of decline and substantially below estimates. The inflation-adjusted data, using the seasonally-adjusted Consumer Price Index, came in even worse at -0.80%. The chart below gives us a close look at the monthly data points in this series since 2009. I've included a linear regression to help us identify the trend.

2015-03-24 Vehicle Miles Traveled: A Structural Change in Our Behavior by Doug Short (Article)

The Department of Transportation's Federal Highway Commission has released the latest report on Traffic Volume Trends, data through January.

"Travel on all roads and streets changed by 4.9% (11.1 billion vehicle miles) for January 2015 as compared with January 2014." The less volatile 12-month moving average is up 0.36% month-over-month and 2.12% year-over-year. If we factor in population growth, the 12-month MA of the civilian population-adjusted data (age 16-and-over) is little changed, up 0.08% month-over-month and up only 0.97% year-over-year.

2015-03-24 Career Center by Various (Article)

Find career opportunities for firms that seek to add financial advisors and planners to their staff. Read more to find out how to post opportunities at your firm.

2015-03-24 An In-Depth Look at Fidelity's Contrafund by Larry Swedroe (Article)

Fidelity's largest actively managed fund is the Contrafund (FCNTX). It's also among Fidelity's top performers, making it their flagship fund, a status previously accorded to the Magellan Fund under Peter Lynch. Will Contrafund investors continue to enjoy outperformance or will they face flagging returns like Magellan's investors did following Lynch's departure?

2015-03-24 How do Deferred-Income Annuities Stack Up Against Rival Products? by Joe Tomlinson (Article)

Deferred-income annuities (DIAs) have received a lot of attention with new Treasury Department regulations encouraging their use. Many tout them as providing the most cost-effective way to generate retirement income. But retirement products are not one-size-fits-all. I'll show where DIAs fit among the products and investment solutions available to advisors.

2015-03-24 Krugman at His Worst by Robert Huebscher (Article)

As an economist, Paul Krugman has much to offer. Sometimes I agree with him, but more often he challenges me to defend my opposing position. When he uses his privileged perch at the New York Times to advance his political agenda, however, he is nothing more than another second-rate "talking head" littering the media. Such was the case with his column on March 16, Israel's Gilded Age.

2015-03-24 Inflation: A Six-Month X-Ray View by Doug Short (Article)

Here is a table showing the annualized change in Headline and Core CPI, not seasonally adjusted, for each of the past six months. I've also included each of the eight components of Headline CPI and a separate entry for Energy, which is a collection of sub-indexes in Housing and Transportation. We can make some inferences about how inflation is impacting our personal expenses depending on our relative exposure to the individual components.

2015-03-24 Two Approaches to Landing New Clients by Dan Richards (Article)

What does it take to build a high-performance team? My analysis shows that the best advisors follow two distinct approaches.

2015-03-24 A Long-Term Look at Inflation by Doug Short (Article)

The Consumer Price Index for Urban Consumers (CPI-U) released this morning puts the year-over-year inflation rate at -0.03%. It is substantially below the 3.85% average since the end of the Second World War and its 10-year moving average, now at 2.25%.

2015-03-24 Negative News and Bad Decisions by Daniel Solin (Article)

The financial media is engaged in a relentless pursuit of negative news items. They know it creates anxiety among investors, which increases viewers and readers. Understanding the role of negative news in your clients' lives will help you guide them toward sound and rational decisions.

2015-03-24 Words Every Client Likes to Hear by Beverly Flaxington (Article)

I've read a lot about different ways to show appreciation for clients: events to plan, gifts to send, newsletters to write, etc. Is there one thing that stands out more than anything else when it comes to letting clients know how important they are?

2015-03-24 The Economic Outlook by George Mokrzan of Huntington National Bank

The United States forecast is for solid average annual economic growth of 3.1% in 2015 -- fastest in the economic recovery to date overall, although areas of the economy with high energy or international exposure will likely encounter headwinds. Strengthening employment conditions, continual improvements in consumer finances and steadily rising housing markets are likely to reestablish the consumer’s lead role in the U.S. economy in 2015.

2015-03-24 A New Playbook for Diversification by Chris Arthur of Eaton Vance

Is an active/passive/smart beta strategy the future of diversification? Chris Arthur, CFA, sees a growing need for a new approach and explains how this one works.

2015-03-24 March Economic Update by Kevin Moloney of Bronfman E.L. Rothschild

With the unemployment rate dropping to 5.5% in early March, the economy has reached the upper limits of the Federal Reserve’s estimate of long-run normal unemployment (5.2% - 5.5%). GDP growth remains stable, with a current estimate of 2.2% growth for the fourth quarter of 2014. The housing market recovery continues at a slow-but-steady pace, with prices rising twice as much as inflation during 2014 (+4.5%) according to the 20 city Case-Shiller Index. The most uncertain aspect of the economic recovery in the U.S. remains the consumer.

2015-03-24 The Active Passive Debate Evolves by Necessity by Roger Nusbaum of AdvisorShares

Daily Alts took a stab at the topic of evolving asset allocation and the blurring of the line between active and passive citing work/theory done by Eaton Vance. As a starting point, and something we’ve been talking about here for several years, the basic 60/40 may be losing some of its effectiveness especially on the 40 side, the fixed income portion, because interest rates are so low and as we learned from the most recent Fed statement may stay lower for longer. The article also considered a blurring of the line between active and passive management.

2015-03-24 Don't Fret Student Debt by Brian Wesbury, Robert Stein of First Trust Advisors

For the past six years, investors have faced one fear after another. One of those fears has been the more than $1 trillion of student loan debt outstanding. This debt is up 160% since the start of 2006 (and growing) while the share of student loans with payments 90 days late, or longer, has risen from 6.4% to 11.3%.

2015-03-24 US Equity Market Review For the Week of March 16-20: Small and Mid-Caps Outperform, Edition by Hale Stewart of XE Currency Blog

Last week, both the small and mid-cap ETFs broke through upside resistance and printed new highs. The IWCs were up 2.5% for the week, closing at 80.49 while the IJHs rose 4.5% and closed at 153.69. This continues a trend that started in early October where the small and mid-cap sectors outperformed the mega-cap stocks.

2015-03-24 A Relatively Dovish Fed Statement Helps Equities Recover Ground by Robert Doll of Nuveen Asset Management

Last week featured some disappointing economic data and further downward revisions of corporate earnings estimates, but investors focused heavily on last week’s Federal Reserve policy meeting. The Fed’s statement was more dovish than expected, and investors interpreted the comments as an indication that rate increases would not happen as soon as some anticipated.

2015-03-24 The New World Order: Part II by Bill O'Grady of Confluence Investment Management

In the second installment of our four-part series we focus on two themes. First, we examine the global public goods the superpower provides, and second, we analyze how the U.S. has done so. The global hegemon often faces tensions between the desires of domestic constituencies and its foreign obligations. Every superpower negotiates these pressures and each tends to have its own ways of meeting both objectives. However, no superpower can subjugate the goals and aspirations of its citizens indefinitely. If the cost of hegemony becomes too high, a nation may be unable to maintain the position.

2015-03-24 U.S. Trade: Shortchanged by a Strong Dollar? by Milton Ezrati of Lord Abbett

Worries that the elevated value of the greenback will crimp U.S. exports—and hurt corporate profits—are overstated.

2015-03-24 Cash Dividends are Key by Richard Skaggs of Loomis Sayles

The income potential of equities is positive right now – especially in this low interest rate and low inflation environment. The S&P 500 currently boasts a yield of around 2.0% and (assuming no recession) dividends should continue to grow.

2015-03-24 February Headline Consumer Price Index: First Increase in Five Months by Doug Short (Article)

The Bureau of Labor Statistics released the February CPI data this morning. Year-over-year unadjusted Headline CPI came in at -0.03% (rounded to 0.0%), up from -0.09% (rounded to -0.1%) the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 1.70% (rounded to 1.7%), up from the previous month's 1.65% (rounded to 1.6%). The non-seasonally adjusted month-over-month Headline number was up 0.43% (rounded to 0.4%), and the Core number was up 0.35% (rounded to 0.3%).

2015-03-24 Give'em the Old Razzle Dazzle by Peter Schiff of Euro Pacific Capital

Janet Yellen channels Billy Flynn? Last week the Fed Chairwoman treated us to a master class of rhetorical misdirection which produced some memorable examples of doublespeak, including the soon to be classic "Just because we removed the word 'patient' does not mean we're going to be 'impatient."' But perhaps more surprising than her new heights of verbal dexterity was the market's euphoria at being so blatantly manipulated. Never has the financial world enjoyed a lie so thoroughly.

2015-03-24 What Inflation Means to You: Inside the Consumer Price Index by Doug Short (Article)

Let's do some analysis of the Consumer Price Index, the best known measure of inflation. The Bureau of Labor Statistics (BLS) divides all expenditures into eight categories and assigns a relative size to each. The pie chart below illustrates the components of the Consumer Price Index for Urban Consumers, the CPI-U, which I'll refer to hereafter as the CPI.

2015-03-24 Richmond Fed Manufacturing Composite: Activity Declined in March by Doug Short (Article)

The March update shows the manufacturing composite at -8, down from 0 last month. Above zero indicates expanding activity; below zero indicates contraction. Today's composite number was well below the forecast of 2.

2015-03-23 Weekly Gasoline Price Update: No Change by Doug Short (Article)

It's time again for my weekly gasoline update based on data from the Energy Information Administration (EIA). Rounded to the penny, Regular was unchanged and Premium dropped a penny.

According to, California has the highest average price at $3.27, even topping Hawaii at $3.14. South Carolina has the cheapest Regular at $2.10.

2015-03-23 Chicago Fed: Economic Growth Slightly Below Average In February by Doug Short (Article)

"Index shows economic growth slightly below average in February": This is the headline for today's release of the Chicago Fed's National Activity Index, and here are the opening paragraphs from the report:

2015-03-23 Monetary Policy and the Economy: The Case for Rules Versus Discretion by John Hussman of Hussman Funds

Deviations in monetary policy from what one would have predicted (using past non-monetary variables alone) have zero correlation or ability to explain subsequent GDP growth (versus the levels that would have been predicted by past non-monetary variables alone). In other words, once we allow for the component of monetary policy captured by a fixed linear rule (the Taylor Rule comes close – and currently indicates an appropriate Fed funds rate of about 3% here), one can find no evidence in the historical record that additional activist monetary policy is useful.

2015-03-23 Dividend Value Investing: No Time for Suspension of Disbelief by Meggan Walsh of Invesco Blog

When Hollywood tells a story, the expectation is that viewers are willing to suspend disbelief to fully immerse themselves in the plot. But when the market tells a story, suspending disbelief may result in overly complacent investors who blithely ignore the potential downside risk of a profit cycle in its later stages, which we see today through the lens of our full-cycle perspective.

2015-03-23 Building a High-Conviction Portfolio of Superior Businesses by (Article)

Portfolio Manager Lauren Romeo talks about how many holdings that populate this Royce portfolio are companies we have seen persevere through various economic cycles, changing industry conditions, and company-specific challenges.

2015-03-23 Special Equity Fund: Looking Back at 2014 and Ahead to 2015 by (Article)

Portfolio Manager Charlie Dreifus discusses the current state of Royce Special Equity Fund's portfolio and what he believes could be a potential tailwind for some of his holdings as the year develops.

2015-03-23 A Body at Rest by Brian Andrew of Cleary Gull

As the temperature rises above 50 for the first time in several months, I am reminded of this Newtonian law that a body at rest will stay at rest unless an outside force acts on it. Perhaps the warm-up in weather is the “outside force” we all need to get moving again. I believe that the current market environment is similar to my body coming out of winter.

2015-03-23 Central Bank Policies And Market Distortions by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

Recurrent countercyclical monetary policies have given way to several distortions in the economy. It is believed that printed dollars have inflated both stocks and bonds in the US, but that is a misunderstanding! Still attractive, US Treasury Bonds may provide the basis for a sustained appreciation of the US dollar against foreign currencies. Once more, the widely anticipated interest rate hike by the FOMC may get postponed… further into oblivion!

2015-03-23 How Should Advisors Evaluate Alternative Strategies? by Michael Winchell of Larkin Point Investment Advisors LLC

Because modern portfolio theory emphasizes the value of holding instruments having low cross-correlations, we’ve heard many advisors describe the search for alternative investments as a search for assets with low correlations to either equities or bonds. This leads advisors too often to consider nontraditional assets over alternative strategies. We believe that perspective is too narrow and misses the larger point. It is our opinion that clients primarily desire reasonable returns with low volatility, and that there are many ways to achieve that goal.

2015-03-23 Tracking the Market with Social Media by Blair Jensen of Trade Followers

The Trade Followers 7 Day momentum indicator for the S&P 500 index (SPX) has confirmed the new uptrend and is indicating that it will most likely have staying power. One kink in the works is that momentum is overbought. This indicates that the market will need to digest recent gains before it can break to all time highs.

2015-03-23 On My Radar: Investors Behaving Badly by Steve Blumenthal of CMG Capital Management Group

There were several charts that caught my eye this week. The first is a chart that tells us the likely annual return for the S&P 500 Index will average just 2.25% over the next ten years. Many valuation measurements support a period of probable low future returns, but this particular data is different – it looks at the percentage of household equity ownership.

2015-03-23 Weighing the Week Ahead: The Quest for New Worries by Jeff Miller of New Arc Investments

In my last WTWA (two weeks ago, since I am allegedly on vacation. I resumed work on Fed day to watch and to meet with readers and potential investors near New Orleans. Next week I’ll be back on my normal). I asked whether good news was now bad for investors. The continuing Fed focus was once again a successful theme, despite the increasing irrelevance of Fed policy.

2015-03-23 Time to Ratchet Up Risk Management? Volatility is Back in Vogue by Patty Quinn McAuley of Clark Capital Management Group

Considering the full spectrum of risk management tools available when building asset allocations can help ensure that clients make the right decisions about their money regardless of market conditions. A personalized risk management approach will adjust and adapt to the changing markets based upon the desired outcome or goal of the client.

2015-03-23 Euro: Parity Like It’s 1999 by Scott Minerd of Guggenheim Partners

Europe stands to benefit as the euro nears parity with the U.S. dollar; the Fed knows the U.S. economy faces a winter soft patch; the outlook for equities and fixed income remains fundamentally strong.

2015-03-23 Understanding the CFNAI Components by Doug Short (Article)

The Chicago Fed's National Activity Index, which I reported on earlier today, is based on 85 economic indicators drawn from four broad categories of data:

  • Production and Income
  • Employment, Unemployment, and Hours
  • Personal Consumption and Housing
  • Sales, Orders, and Inventories

2015-03-21 The Fed -- Drunken Coxswain of the SS America by Paul Kasriel of Econtrarian, LLC

What if the Fed’s luck should change for the worse without its “smarts” changing for better? Well, that question now is relevant. After rebounding to a rate approximately equal to its long-run median, growth in total thin-air credit sharply decelerated in February, both on a year-over-year basis as well as a three-month basis.

2015-03-21 It’s Good to Be Better by Richard Davies of AllianceBernstein

What’s the real point of having a defined contribution (DC) plan in the first place? That’s the big question US plan sponsors needs to ask themselves. If the answer is helping employees achieve better retirement outcomes, then the DC plan can’t just be good: it’s got to be better.

2015-03-21 Beating the Emerging Benchmark Blues by Morgan Harting of AllianceBernstein

It’s been another tough start to the year for emerging-market equities, amid growing concern about political risk and economic growth. But we believe the seeds have been sown for a recovery that can best be captured through a selective investing approach to avoid the risks of a benchmark.

2015-03-21 Five Reasons to Hold High Yield in 2015 by K. Sean Clark of Clark Capital Management Group

We believe that the high yield market may reward investors who adopt a tactical approach. Here are five reasons we anticipate a reemergence of opportunities in the high yield space in 2015.

2015-03-21 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

What Is Full Employment, and Are We There Yet?; Negative Interest Rates Are Spreading Across Europe; The Return of the U.S. Debt Ceiling

2015-03-21 Stuck in Neutral by Rob Isbitts of Sungarden Investment Research

We see emphasis on “neutrality” in outlook in several of the indicators we follow at Sungarden, including our Sungarden® Stock Scoring System. From a fundamental and technical standpoint, we see fewer screaming long-term buys than we have in some time, yet we also don’t see too many situations that signal pending disaster.

2015-03-21 What the Federal Reserve and the Fear Trade Do for Gold by Frank Holmes of U.S. Global Investors

Following the Federal Open Market Committee (FOMC) meeting yesterday, Federal Reserve Chair Janet Yellen made it clear (again) that interest rates would not be raised until inflation gains more steam. With current inflation rates negative for the first time since 2009, and with the U.S. dollar index at an 11-year high, we can probably expect near-record-low interest rates for some time longer.

2015-03-21 Optimism, Pessimism and Opportunity by Ed Perks of Franklin Templeton

Given that the S&P 500 has been on a tear since 2008, logging double-digit returns in five of the past six years, and US Treasury rates remain near historical low levels, many investors are questioning their prospects for long-term total return. Ed Perks, chief investment officer and portfolio manager, Franklin Equity Group®, offers his views on why he remains optimistic about the US market’s prospects, and where he’s looking for investment opportunities today.

2015-03-21 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 131.1, down slightly from 131.6 the previous week. The WLI annualized growth indicator (WLIg) is at -3.7, up from the previous week's -4.0 and off its interim low of -5.0 in mid-January.

2015-03-21 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

Strong price and breadth suggest the uptrend from the March low has further to go. A dip early in the week is a high probability buy set up. But gains from here are likely to be short lived; nibble traders may want to sell into strong gains on the expectation of weakness over the next month.

2015-03-20 The Declining Demand for Driving Vehicles by Doug Short (Article)

Paul Hodges, who writes a blog for on Chemicals and the Economy, recently sent me link to his fascinating study on the correlation between gasoline prices and the Department of Transportation's monthly statistics on vehicle miles driven. Paul offers a new perspective with a scatter chart showing the correlation between gasoline prices (vertical axis) and per-capita vehicle miles traveled on the horizontal axis.

2015-03-20 Northern Trust Perspective by Team of Northern Trust

The long-telegraphed launch of quantitative easing by the European Central Bank (ECB) has added some accelerant to financial market trends in place so far this year. European stocks, which had been strong performers in local currencies, have continued their strong performance while European bond yields have declined even further.

2015-03-20 Key Questions for China Investors in 2015—Part III by Andy Rothman of Matthews Asia

In this final installment of a three-part Sinology series, Andy Rothman, Matthews Asia Investment Strategist, answers the question: is China’s property market heading for a crash? He also discusses what he believes are the biggest long-term risks to growth and stability—an absence of the rule of law and trusted institutions.

2015-03-20 The student loan debt crisis revisited: For-profits come to the forefront by Leighton A. Hunley of Milliman, Inc.

Problems connected with high levels of student loan debt continue to make headlines. Today, the controversy centers around for-profit colleges, which, according to The Wall Street Journal, teach about 11% of higher education students, but whose students account for 44% of defaults on federal loans.

2015-03-20 Navigating Interest Rate Cycles with the Laddered Bond Portfolio by Josh Gonze of Thornburg Investment Management

The purpose of fixed income for most investors is to generate income and serve as ballast in their broader portfolios. It’s not meant to be the fastest boat in the water, but rather the most seaworthy. Since the global financial crisis, major central banks have kept interest rates at rock-bottom levels and provided abundant liquidity through asset purchase programs more commonly known as quantitative easing.

2015-03-20 Conference Board Leading Economic Index Remains in Growth Territory by Doug Short (Article)

Note from dshort: I've appended a couple of rather striking charts at the bottom of this commentary in response to a suggestion from my friend Bob Bronson. What would the Conference Board's LEI look like if it were adjusted for population growth and inflation? Check it out.

2015-03-20 The Philly Fed ADS Business Conditions Index by Doug Short (Article)

The Philly Fed's Aruoba-Diebold-Scotti Business Conditions Index (hereafter the ADS index) is a fascinating but relatively little known real-time indicator of business conditions for the U.S. economy, not just the Third Federal Reserve District, which covers eastern Pennsylvania, southern New Jersey, and Delaware. Thus it is comparable to the better-known Chicago Fed's National Activity Index.

2015-03-19 De-risking Goes Beyond Interest Rate Risk: The Case for Dynamic Asset Allocation in an LDI Solution by Catherine LeGraw of GMO

In this piece, we introduce a measure of valuation risk, and demonstrate how rotating growth assets into a valuation-aware dynamic strategy can help to reduce risk, improve long-term returns, and help improve funded status in the case of a reversion to the mean.

2015-03-19 Muni market – Favorable environment remains in place by James Dearborn of Columbia Management

Municipal bond market volatility in early '15 may have investors wondering if they should sell today and lock in their gains from 2014. After 13 consecutive months of positive returns, the muni market turned negative in February and the first two weeks of March as interest rates rose. After such a long and strong run, it is not surprising that the muni market has taken a step backward. That said, we do not see reason to panic and continue to believe that the muni market remains on sound footing due to supportive market fundamentals and technicals, as well as our entrenched high tax environment

2015-03-19 Cabela’s: Little Room for Error by Jenny Hubbard of Diamond Hill Capital Management, Inc.

Through our research process, we attempt to identify actionable investment ideas, but we often conclude that a company does not present an immediate long or short investment opportunity. A decision not to invest in a company is valued just as much as a decision to invest in one, but we are always expected to stay current on our area of coverage in case conditions change.

2015-03-19 Patiently Waiting by Anthony Valeri of LPL Financial

The Fed faces a number of obstacles now and may require greater justification to suggest raising interest rates as soon as June. Bond market reaction to recent Fed meetings has been initially bearish but muted overall. Maintaining the word “patient” could have different implications for segments of the bond market.

2015-03-19 Dollar Strength is a Symptom, Not a Cause by Burt White of LPL Financial

We do not think the strong U.S. dollar will derail the bull market. The dollar itself is not a key driver of market performance; it is a symptom.

2015-03-19 Growth in the Euro Zone: Europeans Consuming Again by Laura Sarlo of Loomis Sayles

Euro area growth appears set to outperform in 2015, thanks in part to a stronger consumer. Consumers are feeling more confident about their own economies, and in some spots, job growth and wage increases provide an additional boost. Here are some of the major consumer trends I have noticed across the euro zone.

2015-03-19 Dropping the "Patient" Word Does Not Mean the Fed Is "Impatient" by Team of Northern Trust

Markets sometimes hang on every word from the Federal Reserve. In recent weeks, they had been hanging on a single word: “patient.” This term had been used to describe the prospective approach to policy tightening in recent statements; analysts speculated that removing the term would be a strong signal that rates would be heading up soon.

2015-03-19 Merk Analysis: How to Diversify When the Fed Out of Patience? by Axel Merk of Merk Funds

The S&P 500 has more than tripled in six years, just like in 1929 and 1999-2000. What could possibly go wrong?

2015-03-19 Could India “Run the Table” like China by Jeremy Schwartz of WisdomTree

Jeremy Schwartz had the opportunity to speak with Rob Lutts, CIO of Cabot Wealth Management, a client of WisdomTree, about a research trip to India he had just taken. India has been a standout among emerging market countries, and Lutts’ outlook is that India remains a very attractive place to allocate part of his growth portfolio capital.

2015-03-19 Yellen Loses "Patience," But Maintains Flexibility by Brian S. Wesbury and Robert Stein of First Trust Advisors

The Federal Reserve is no longer committed to being “patient” before it starts raising rates. In Fed-speak, that means it will actively consider raising rates starting in two meetings, which will be in mid-June.

2015-03-19 10 Investment Quotes To Live By by Lance Roberts of Streettalk Live

As markets hover near all-time highs, investors have become quite complacent that the current bull market trend will continue indefinitely. But why shouldn't they? After all, the Central Banks of the world have made it a primary mission to ensure that asset prices don't fall in order to keep extremely weak economies limping along.

2015-03-19 Proposed Changes to U.S. Bankruptcy Code Could Create Opportunities in Distressed Credit by Sai S. Devabhaktuni, Ethan Schwartz of PIMCO

The American Bankruptcy Institute's (ABI) proposals aim to balance the objectives of effective reorganization of debtors and the maximization of asset values for all creditors and stakeholders. The proposals seem to mark an effort to modify the positions of different creditor classes in bankruptcy, a move that could disadvantage both senior and junior creditors depending on the particular case.

2015-03-19 Riding a Wave of Accommodation by Carefully Richard Clarida, Andrew Balls of PIMCO

PIMCO’s quarterly Cyclical Forum was held earlier this month to evaluate and assess the state of the global economy, to reach consensus on the near-term macroeconomic outlook, and to explore the tail risks to that outlook.

2015-03-19 Meet the world’s worst economic forecasters – The Fed by Lance Roberts of Streettalk Live

I have been tracking the Federal Reserves forward looking projections ever since they begin releasing their forecasts. The purpose of tracking these projections was to compare the Fed's forecasts with what eventually became reality. The record is now clear...they are the worst economic forecasters...ever.

2015-03-19 Philly Fed Business Outlook: Modest Growth, A Bit Below Expectations by Doug Short (Article)

The latest gauge of General Activity came in at 5.0, essentially unchanged from last month's 5.2 and the lowest reading since the -2.0 contraction in February of last year. The 3-month moving average came in at 5.5, down from 11.9 last month. Since this is a diffusion index, negative readings indicate contraction, positive ones indicate expansion. The Six-Month Outlook was little unchanged at 32.0 versus the previous month's 29.7.

2015-03-18 APViewpoint Event: "The Tested Strategy That Increases Client Assets by Doug Short (Article)

Presenter: Dan Richards
Wednesday, March 18, 2015 - 4:15 PM ET

In today's time-pressed world, advisors need to make sure that every minute counts when communicating with clients. In this webinar, you'll hear what today's most successful advisors are doing to operate more effectively:

2015-03-18 Curse of the Brilliant Client by David Edwards of Heron Financial Group

What do I say when clients think they know more than I do? At my firm, we work with executive families. Our clients are brilliant; many have advanced degrees from top universities. These clients have ascended to the pinnacles of their careers and are accustomed to being the smartest person in the room.

2015-03-18 The Surging U.S. Dollar - Good For Some, Bad For Others by Gary Halbert of Halbert Wealth Management

The US dollar has been surging against most other currencies over the last year. The question is, is the rising US dollar good for the economy and the investment markets, or not? No doubt, the rising dollar has been buffeting the US equity and bond markets this year and is increasingly cited as the main culprit. That is what we will delve into today.

2015-03-18 How Far Will the Euro Fall? by Anatole Kaletsky of Project Syndicate

The US dollar is hitting new 12-year highs almost daily, while the euro seems to be plunging inexorably to below dollar parity. But there are plenty of reasons to believe that the exchange-rate trend may already be overshooting.

2015-03-18 Alpha Matters More in Muted Equity Markets by Chris Marx of AllianceBernstein

In a Wall Street Journal article last week, financial advisors described how exuberant investors had unrealistic expectations for stock market returns after a six-year rally. We think a more pragmatic approach should aim to beat a slower-paced market in an effort to capture compounding returns.

2015-03-18 Keep it Simple: India is Outperforming Because Oil is Crashing and Inflation is Tame by Team of GaveKal Capital

India has for years battled high levels of inflation which has in many ways kept the country from realizing its full economic potential. Over the last year though, basically since the price of oil stopped going up, Indian inflation has remained tame. As global growth has continued to muddle through, the further collapse of the price of oil has been a major tailwind for India since global growth has not collapsed in lockstep.

2015-03-18 Global Economic Perspective: March by Franklin Templeton Fixed Income Group® of Franklin Templeton Investments

IN THIS ISSUE: United States Prepares for Interest-Rate Hikes; But Much of the World Is Still in Monetary Easing Mode; European Outlook

2015-03-18 WSJ Economists' Forecasts for 10-Year Yields and the Fed Funds Rate by Doug Short (Article)

The big economic news today will start the statement from the Federal Open Market Committee at 2 PM ET and followed by Janet Yellen's press conference 30 minutes later. The economic press has been a veritable cacophony pundit views on whether the word "patient" remains or is discarded in the new statement. Here is the key sentence in the previous statement (emphasis added).

2015-03-17 Gundlach - Don't Bet on Higher Rates by Robert Huebscher (Article)

Even if the Fed raises short-term interest rates as many expect it to, longer-term bond investors won't face a decline in prices, according to Jeffrey Gundlach. Indeed, the market may have already priced in the effect of rate hikes, he said.

2015-03-17 Prognosis Excellent for Health Care by Sponsored Content from Invesco (Article)

Three years of outperformance is rare; a fourth would be unprecedented. Parts of the health care sector are more defensive, but opportunities to outperform exist even in an up market. Biopharmaceutical pipelines, M&A activity and reform will help drive longer-term health care outperformance.

2015-03-17 How Advisors Are Positioning Fixed-Income Portfolios by Bob Veres (Article)

I asked the readers of my Inside Information newsletter service to tell me how they're preparing for an impending Fed rate hike. To date, I've received 178 pages of responses from advisors all over the country and across the spectrum, from indexers to fervent believers in active management, representing large and small firms investing on behalf of wealthy or middle-income clients.

2015-03-17 MLPs Will Weather the Storm by Sponsored Content from ClearBridge Investments (Article)

A significant decline in oil prices has led to increased MLP volatility. However, their fundamentals remain robust. Our latest white paper examines the economics of the U.S. oil and natural gas markets and their impact on the outlook for MLPs.

2015-03-17 Do Liquid Alts Justify Their Costs? by Robert J. Martorana, CFA (Article)

Liquid alts are complex and expensive, so it is natural for advisors to ask if they worth the time and trouble. In this article, I answer this question. I evaluate returns with special emphasis on 2014, when managed futures (notably the AQR Managed Futures Strategy Fund - AQMIX) soared and the largest global macro fund, MainStay Marketfield (MFLDX), stumbled.

2015-03-17 The Skill Set for Exceptional Performance by Dan Richards (Article)

Once you have built an initial client base, you face a very different set of challenges to take your practice to the next level. Overcoming that challenge boils down to identifying and cultivating the skill set needed for exceptional performance - and that's building and managing a high-performance team.

2015-03-17 How to Deal with High-Anxiety Clients by Daniel Solin (Article)

This is not an easy time to be an investor. Market volatility, often represented in the financial media through triple-digit gyrations in the Dow), creates understandable anxiety. Here's how to assess the source of your clients' anxiety and some tips for easing it.

2015-03-17 Bounded Rationality, Unbounded Confidence by Baijnath Ramraika, CFA® and Prashant Trivedi, CFA® (Article)

Our rationality is limited by the information we have, the cognitive limitations of our minds and the finite amount of time we have to make a decision. Herbert A. Simon called that concept "bounded rationality." As a consequence of these limitations, our confidence becomes unbounded. We will discuss the implications of this phenomenon and how investors can overcome it.

2015-03-17 Market Cap to GDP: The Buffett Valuation Indicator by Doug Short (Article)

Note from dshort: In response to several requests, here's a somewhat belated update to the popular "Buffett Indicator".

I've now updated the GDP denominator with the BEA's Q4 Second Estimate. The numerator is from the Fed's Z.1 Financial Accounts. The indicator remains over 2 standard deviations above its mean at an interim high of 127.4%. We'll get one more tweak of the Q4 2014 indicator on March 27th. The bigger news will be our first look at the Q1 2015 data on April 29th.

2015-03-17 The Art of Pension Hopping by Antolin Du Bois, CFP® (Article)

Clients who are unlikely to complete a traditional 30-year defined-benefit pension and are willing to pursue an un-orthodox strategy of switching work locations, continually re-purchasing prior service completed in another location will increase their work options, their retirement security and their overall pension income.

2015-03-17 How to Get Your Team to Use Your CRM by Beverly Flaxington (Article)

After a lengthy search, my staff and I agreed on a CRM system and paid for consulting and installation. Now we have installed it, but no one is using it. They offer excuses: it is unwieldy or they don't have the time. How do I get them to use the system that they asked for in the first place?

2015-03-17 Monetary Policy Concerns Continue to Weigh on Markets by Robert Doll of Nuveen Asset Management

Investors continued to focus on global monetary policy last week. The divergence between the start of the European Central Bank’s quantitative easing program and the pending shift in the Federal Reserve’s policy stance caused the euro to fall, the U.S. dollar to rally and acted as a drag on U.S. equities. Concerns over a weakening corporate earnings environment acted as an additional headwind for stock prices. the S&P 500 Index declined 0.8% for the week.

2015-03-17 The Messy Politics of Economic Divergence by Mohamed El-Erian of Project Syndicate

The world is increasingly characterized by divergence – in economic performance, monetary policy, and thus in financial markets. Though there is a broad consensus on what must be done to rebalance the global economy, political leaders remain unwilling to fulfill their economic-governance responsibilities.

2015-03-17 Resist the Rate-Hike Huff by Brian Wesbury, Robert Stein of First Trust Advisors

In June 2013, then-Federal Reserve Chair Ben Bernanke hinted the time to “moderate” quantitative easing was approaching. The press called this “tapering”. The Fed would end QE gradually, by slowly shrinking its asset purchases rather than going cold turkey.

2015-03-17 FOMC Preview: When, How Often, and How Much by John Canally of LPL Financial

What the FOMC says, if anything, about the rising dollar and its implications, could have ramifications for monetary policy over the next several quarters and beyond. In addition to “when,” market participants may start asking “how much” and “how fast” rates may increase once the Fed begins to raise the rates. We are watching several factors to gauge when the Fed may begin to hike rates, including wages, the output gap, inflation, and inflation expectations.

2015-03-17 The New World Order: Part I by Bill O'Grady of Confluence Investment Management

We have focused for several years on the issue of the uncertainty surrounding America’s superpower role. It has been our position that the U.S. has lacked a coherent foreign policy since the Cold War ended in the early 1990s. Although we cannot definitely say that a new policy is in place, the trappings of one appear to be emerging. The focus of this paper is how policy seems to be evolving and why. This will be a four-part report. Part I begins with the evolution of U.S. foreign policy, focusing on the 25-year cycle pattern between the adaptations to new circumstances.

2015-03-17 Japan: Why Stagnation Is the "Abe Normal" by Milton Ezrati of Lord Abbett

Until the prime minister draws the "third arrow"—structural reform—from his quiver, Japan's economic and investment prospects will remain limited.

2015-03-17 The 11-Year Itch: Waiting for the Fed to Act by Jon Denfeld of AllianceBernstein

It was 2004: the New England Patriots won their second Super Bowl, Facebook was launched and the US Federal Reserve raised interest rates for the first time in four years—the start of a two-year cycle of rate hikes. To markets, it seems like a distant memory.

2015-03-17 The Airline Industry Ascended to New Records in 2014 by Frank Holmes of U.S. Global Investors

Just as the U.S. economy is in full-recovery mode, so too is the airline industry. It’s lately made an impressive about-face from only a decade ago and, in 2014, soared to several new benchmarks.

2015-03-17 Waiting for the Squirrel by Jerry Wagner of Flexible Plan Investments

Spring has finally begun to show itself here in Michigan. It has been a brutal winter. Molly, our six-year-old, loveable mutt (of “Where’s Molly” fame), loves the new freedom that warmer weather brings. She bounds from the door each chance she gets and instead of the quick return that the winter’s cold elicited, she is gone for hours. Where does she go? First there is a quick reconnaissance of the property, carefully sniffing every square inch it seems. Then, she’s caught the scent. A flash of movement catches her eye. It’s her arch nemesis - the squirrel.

2015-03-17 Should You Buy in to Oil’s Secular Bear Market? by William Smead of Smead Capital Management

March 10th is one of my favorite days of the year. The tech bubble of the late 1990's burst on March 10th of 2000 and the biggest bear market of my career (2007 peak to 2009 low) bottomed on March 10th of 2009. There is a great deal to learn from those two dates in history as it pertains to the way secular bear markets work and how long it takes to move from the most popular investment in the world to being completely out of favor.

2015-03-16 Extremes in Every Pendulum by John Hussman of Hussman Funds

Whether or not it is fully appreciated, we are observing extremes in nearly every pendulum of the global financial markets. The situation is likely to be seen in hindsight as one of the broadest points of financial distortion in history.

2015-03-16 How Scary Is the Bond Market? by Robert Shiller of Project Syndicate

With the bond market appearing ripe for a dramatic correction, many are wondering whether a crash could drag down markets for other long-term assets, such as housing and equities. But when an event has never occurred, it cannot be predicted with any semblance of confidence.

2015-03-16 Welcome to the World of Taxes! A Philosophical Introduction for New Taxpayers by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, discusses his philosophy on taxes for the high net worth, especially from an international perspective.He notes "two waves" of investors who are new to tax planning.

2015-03-16 This Too Shall Pass by Scott Minerd of Guggenheim Partners

Behavioral finance reminds us that ignoring daily volatility roiling the market is wise. Instead, investors should focus on the positive, fundamental outlook for equities and fixed income.

2015-03-16 Should Greece Stay or Go? by Jeremy Schwartz of WisdomTree

Professor Jeremy Siegel and I spoke with University of Texas professor James Galbraith on February 27. Professor Galbraith has an inside look on the ongoing Greek debt dynamics, as he became friendly with the current Greek finance minister Yanis Varoufakis as a colleague at the University of Texas.

2015-03-16 An Overview of Nontraditional Assets by Michael Winchell of Larkin Point Investment Advisors LLC

We review a collection of nontraditional assets and acknowledge the growing attempts to offer more liquid instruments with market exposure to these assets. However, it is our opinion that these assets will ultimately represent a small portion of the overall allocation to alternative investments.

2015-03-16 On My Radar: Rate Hike Ahead, Bond Model Says Sell by Steve Blumenthal of CMG Capital Management Group

I wrote a piece in Forbes this week titled “Rate Hike Ahead, Bond Model Says Sell”. The gist of the piece is about a tug of war between opposing views on the direction of interest rates. The outcome of this contest will enrich some and demoralize others.

2015-03-16 Ingredients Missing for a Turnaround in Brazil by Russ Koesterich of BlackRock

Brazil has struggled in the past years, bogged down by unfavorable economic conditions including a collapse in growth. A recovery would hinge upon some much needed structural reforms.

2015-03-16 APViewpoint Event: "The Tested Strategy That Increases Client Assets by Doug Short (Article)

Presenter: Dan Richards
Wednesday, March 18, 2015 - 4:15 PM ET

In today's time-pressed world, advisors need to make sure that every minute counts when communicating with clients. In this webinar, you'll hear what today's most successful advisors are doing to operate more effectively:

2015-03-16 Empire State Manufacturing: Modest Expansion, Below Expectations by Doug Short (Article)

This morning we got the latest Empire State Manufacturing Survey. The diffusion index for General Business Conditions at 6.90 shows a slippage from last month's 7.78, which signals expansion at a modest pace. The forecast was for a reading of 8.0.

2015-03-16 Brazil: Macro Headwinds Are Strengthening by Sean Newman of Invesco Blog

Invesco Fixed Income’s outlook on Brazil as a sovereign credit is deteriorating. Downside risks to growth have increased given the country’s deteriorating fiscal position, rising interest rates, lower commodity prices, global growth headwinds, water and electricity shortages, among other challenges. The key for markets, in our view, will be the administration’s ability to deliver on promised fiscal adjustments.

2015-03-14 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

Our overall view continues to be that 2015 will not be like 2013 or 2014. This is a year where fundamentals improve while equity prices mark time, allowing sentiment and valuation to fall back inline. This is a common pattern: large parts of 1994, 1996, 1998, 1999, 2004 and 2005 were similar. That November and December were the first back to back down months in 3 years bears out the change in character.

2015-03-14 Ingredients Missing for a Turnaround in Brazil by Russ Koesterich of BlackRock

Brazil has struggled in the past years, bogged down by unfavorable economic conditions including a collapse in growth. A recovery would hinge upon some much needed structural reforms.

2015-03-14 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

China Moves Cautiously Toward a New Normal; Deleveraging Is Unfinished in the Industrialized World; Will Lower Borrowing Costs in Europe Be a Boon for U.S Firms?

2015-03-14 The Airline Industry Ascended to New Records in 2014 by Frank Holmes of U.S. Global Investors

Just as the U.S. economy is in full-recovery mode, so too is the airline industry. It’s lately made an impressive about-face from only a decade ago and, in 2014, soared to several new benchmarks. This industry is flying high again.

2015-03-14 The U.S. Dollar: Is Strength a Weakness? by Jim McDonald of Northern Trust

The U.S. dollar has seen strong upward moves in the past 9 months. What would continued dollar strength mean for economic growth, earnings and asset class performance? Find out more in Jim McDonald's latest strategy piece.

2015-03-14 Will Dipping Data Lead To Dramatic Drop? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

US stocks have been resilient, although there has been an uptick in volatility. Economic data has shown some softening, but we believe it is temporary in nature. However, the risk of a correction is elevated in our view and investors should be prepared for such a possibility by having a diversified portfolio and keeping a close eye on rebalancing opportunities after pullbacks. Meanwhile, investors should also look overseas for global diversification opportunities as monetary policy easing should help to bolster asset values.

2015-03-13 Prospect of U.S. Fed Hike & its Effect on Asian Assets, Part I by Gerald Hwang of Matthews Asia

How close are we to a U.S. Federal Reserve (Fed) rate hike? How would a hike affect Asian securities? These are the questions we explore in this two-part series of Asia Insight.

2015-03-13 Equities: Enhancing the Core/Satellite Framework by Sabrina Callin, Andrew Pyne of PIMCO

?In a lower-returning environment, investors may need to look beyond traditional active or passive approaches in order to capture equity alpha. The “building blocks” of equity alpha include high active share stock selection, smart beta-based strategies and portable alpha approaches. These complementary sources of alpha can be implemented in an enhanced core/satellite framework to allow investors to pursue the returns needed to meet their objectives.

2015-03-13 Charting The Winners And Losers Of The Latest Surge In The USD by Team of GaveKal Capital

On March 4th we wrote in The Dollar Is Breaking Out Again And What It Means For Stocks that "for a variety of cyclical and structural reasons...stocks in North America tend to be the relative beneficiary of USD strength while stocks in other regions generally, but not always, tend to underperform. The negative correlation is especially strong for European stocks." Well, since then the USD has surged another 6% so we thought we'd review how things have played out.

2015-03-13 Could the Search for Income Lead to Instability? by Daniel Loewy, Morgan Harting of AllianceBernstein

Years of quantitative easing has pushed yields on government bonds down to record lows, and income-starved investors are being pushed out the risk spectrum, forced to choose between more volatile assets to find income. Finding acceptable levels of income exposes portfolios to greater instability ahead—we believe a multi-asset approach can help.

2015-03-13 Household Net Worth: The "Real" Story by Doug Short (Article)

Let's take a long-term view of household net worth from the latest Z.1 release. A quick glance at the complete data series shows a distinct bubble in net worth that peaked in Q4 2007 with a trough in Q1 2009, the same quarter the stock market bottomed. The latest Fed balance sheet shows a total net worth that is 50.9% above the 2009 trough and 22.2% above the 2007 peak and at an all-time high. The nominal Q4 net worth is up 1.9% from the previous quarter and up 5.2% year over year.

2015-03-13 Producer Price Index: Another Negative Surprise by Doug Short (Article)

Today's release of the February Producer Price Index (PPI) for Final Demand came in at -0.5% month-over-month seasonally adjusted. That follows the previous month's -0.8% decline. Core Final Demand (less food and energy) also came in at -0.5% month-over-month following a -0.1% change the month before. The forecasts were for 0.3% headline and 0.1% core. The year-over-year change in Final Demand is -0.7%, the lowest in the brief history of this data series.

2015-03-13 The Fed Balance Sheet: What Is Uncle Sam's Largest Asset? by Doug Short (Article)

Pop Quiz! Without recourse to your text, your notes or a Google search, what line item is the largest asset on Uncle Sam's balance sheet?

  • A) U.S. Official Reserve Assets
  • B) Total Mortgages
  • C) Taxes Receivable
  • D) Student Loans

2015-03-13 Big Government, Little Buns by Brian Wesbury, Robert Stein of First Trust Advisors

You’re kidding, right? It’s 2015. How can a populated country run out of bread? It would be understandable if a natural disaster or devastating war caused a shortage, but neither of these is happening in Venezuela – and they seem to be running out of bread. Why? Well, Socialism, of course.

2015-03-13 Keep it Short? The Limited-Term Fixed Income Market by Mark Otterstrom, Susan Regan of Ivy Investment Management Company

Concern about interests rates has made fixed income investors more aware of the potential for interest rate risk – or the risk that a rise in rates will reduce the value of their longer-maturity securities. This risk, which is often expressed as a bond or bond fund’s “duration,” has led some investors to consider investments believed to have less potential risk. These securities, which are considered to have a lower duration, are seen as less vulnerable to market volatility.

2015-03-12 The Q Ratio and Market Valuation: New Update by Doug Short (Article)

Note from dshort: This commentary has been updated to incorporate the Federal Reserve release of the Q4 Financial Accounts.

The Q Ratio is a popular method of estimating the fair value of the stock market developed by Nobel Laureate James Tobin. It's a fairly simple concept, but laborious to calculate. The Q Ratio is the total price of the market divided by the replacement cost of all its companies.

2015-03-12 A Stunning Miss for February Retail Sales by Doug Short (Article)

The Advance Retail Sales Report released this morning shows that sales in February came in at -0.6% month-over-month, which comes on top of a -0.8% in January and a -0.9% decline in December. Core Retail Sales (ex Autos) came in at -0.1%, which follows a -1.1% in January and a -0.9% December decline. The general pundit view is that unseasonably cold weather was responsible for the weak numbers.

2015-03-12 Great Advice from Bill Bernstein by Roger Nusbaum of AdvisorShares

Investing/indexing legend Bill Bernstein was interviewed by and had a couple of great nuggets that are useful for any type of investor and helpful for advisors’ communication with their clients.

2015-03-12 Is a New U.S. Bear Market Hanging Over Our Head? by Robert Lamy of The Forecasting Advisor

The current bull stock market is now six years old and it will start its seventh year on March 9th. As of March 6th, the S&P 500 stock price index has risen by 206% from the last bear market through of March 9th, 2009. This gain implies that the current bull market recorded a larger increase and rose for a longer period than most of the previous bull markets over the past fifty years.

2015-03-12 Beige Book Suggests Continued Modest Economic Growth by John Canally of LPL Financial

The latest Beige Book suggests that the U.S. economy is still growing at a “modest or moderate” pace that is at or above its long-term trend, and that some upward pressure on wages is beginning to emerge. Optimism on Main Street remains high despite the recent barrage of bad news on the economy. Over the past three Beige Books, the BBB averaged +85, in-line with the +89 average reading in all of 2014.

2015-03-12 Global Macro Framework by Alexander Giryavets of Dynamika Capital L.L.C.

Global Carry, Yen and Dollar are irrefragable drivers of Global Macro. As we explain equities and bonds are just derivatives of these factors. We expose how the big picture asset dynamics worked since the GFC, brief on what happened over the last year and conclude with comments on dollar blowout over the past week.

2015-03-12 Pop Quiz: What Is The Best Performing Regional Sector YTD? by Team of GaveKal Capital

The recent focus of the financial world (including for us) has been on the massive currency moves going on in the forex markets. By this point, everyone and their grandma knows that the US dollar has been on an explosive move higher. Since we are in a stronger US dollar environment now that must mean the US stock market has been outperforming in US dollar terms, correct? Not so fast.

2015-03-12 Cutting Through the Currency Fog by Mark Phelps, Dev Chakrabarti of AllianceBernstein

With the euro sliding deeper against the dollar this week, equity investors have been getting nervous. But why is everyone so surprised when known currency fluctuations derail earnings? In our view, a sharper focus on company exposures can help create a “natural” currency hedge in global equity portfolios.

2015-03-11 Continuing Proof of Structural Changes in the U.S. Workforce by Doug Short (Article)

At last year's Jackson Hole Symposium, Fed Chair Janet Yellen delivered an extended analysis of "Labor Market Dynamics and Monetary Policy". Her speech essentially reviewed the ongoing debate over the mix of cyclical versus structural factors in employment since the Great Recession.

I've updated a series of charts illustrating some structural changes in the workforce that are far more significant than the cyclical impact of the Great Recession.

2015-03-11 A Patient Fed Considers Losing Patience by Peter Schiff of Euro Pacific Capital

I have always argued that quantitative easing and zero percent interest rates were misguided policies to combat economic weakness. But as the years went on, misguided turned into irresponsible, which led to ridiculous, and then turned into dangerous. But lately, the only word that comes to mind is "surreal." How should we react when central bankers begin to speak like Willie Wonka?

2015-03-11 Strong Jobs Report Hits Fed's Rate-Hike Target Zone by Gary Halbert of Halbert Wealth Management

Last Friday’s unemployment report for February was stronger than expected, both in terms of new jobs created and the headline unemployment rate which fell from 5.7% to 5.5%. This sparked growing fears among investors that the Fed will move to raise short-term interest rates sooner rather than later. Stocks fell sharply just after the report.

2015-03-11 Metals May Have an Evil Intent by Avi Gilburt of

From an anecdotal sentiment perspective, before I go into this week’s analysis, I would like to give you a little feedback from this year’s Prospectors and Developers Association of Canada (PDAC) annual convention. I was honored at being a featured speaker there this year, and discussed how I viewed us as being on the cusp of the next great bull market in the investment world. But, the most common comment I received from all those with whom I spoke was that the attendance had been quite underwhelming.

2015-03-11 The Expansion Settles, but Its Foundation Is Strong by Team of Northern Trust

Growth in the U.S. economy tapered a bit in the fourth quarter, but the outlook ahead remains very positive. Real gross domestic product (GDP) grew 2.2% in the fourth quarter after a 5.0% increase in the third quarter, but some special factors were at play that should ease as the first quarter of 2015 winds down.

2015-03-11 Worries about the Looming Fed Hike Spill Over by Russ Koesterich of BlackRock

Many investors are anxious about a possible bubble in stock markets, but those fears seem overblown to us. The greater near-term danger may be a more aggressive Federal Reserve.

2015-03-11 A Contrarian Case for Brazil by Mark Mobius of Franklin Templeton Investments

Many investors in Brazil, including us, have been a little frustrated over the past couple of years with its lack of growth and progress. Gross domestic product (GDP) in Brazil grew a mere 0.2% in 2014 (estimated), a far cry from the 7.5% it saw in 2010. However, we believe Brazil has all the elements in place to achieve much higher rates of growth if the political will is there.

2015-03-11 The Market Is Pricing In Two Rate Hikes In 2015 (And Four In 2016) by Team of GaveKal Capital

According to Fed Fund futures, the market currently expects about 2 rate hikes by December 2015 (assuming the Fed raises rates by 25 basis points each time). Fed Funds futures is pricing the Fed Funds Rate at 54 basis points by December 2015. The market was most optimistic regarding delaying fed hikes in mid-January when the market was pricing in only about one and half hikes for 2015.

2015-03-11 Optimal Diversification Portfolio for Upcoming Interest Rate Environment by Chuck Self of iSectors

Historical patterns in interest rates leading to the current trend; Macroeconomic activity supporting future rising interest rates; Recommendations for optimizing client portfolios in such an environment

2015-03-10 Small Business Optimism: A Fractional Monthly Gain by Doug Short (Article)

The latest issue of the NFIB Small Business Economic Trends is out today. The March update for February came in at 98, a fractional change of 0.1 point from 97.9 the previous month and off the December interim high of 100.4. The index is now at the 37th percentile in this series. The forecast was for 99.2.

2015-03-10 A Warning Sign from the Latest Wage Data: Update by Doug Short (Article)

Note from dshort: I've added a second chart to show the correlation between hourly earnings and inflation.

Over the weekend, my virtual friend and occasional correspondent New Deal Democrat requested some assistance on visualizing Average Hourly Earnings of Production and Nonsupervisory Employees.

2015-03-10 The Hidden Peril in Sequence of Returns Risk by Wade Pfau (Article)

Should retirees place greater faith in stocks' ability to outperform bonds over reasonable holding periods or in insurance companies and bond issuers' ability to meet their contractual guarantees? Your position on this fundamental question will determine how you choose to build retirement income strategies for your clients.

2015-03-10 Curiouser and Curiouser... by Sponsored Content from Legg Mason (Article)

Though historically low, U.S. interest rates are actually high in comparison to the rest of the developed world. U.S. bonds appear overpriced on domestic fundamentals, but they are a bargain based on global valuations.

2015-03-10 America's China Codependency by Michael Edesess (Article)

The massive Chinese investment in Treasury securities helps keep interest rates extremely low. This hugely increases the incentive for Americans to borrow. All that is needed is "collateral," and Americans will go out and borrow to their hearts' content and buy Chinese goods.

2015-03-10 What Advisors Can Learn from Bernie Madoff by Dan Richards (Article)

Few advisors would admit that they have anything to learn from Bernie Madoff. But setting the obvious ethical issues aside, advisors can still learn from the most notorious con artist of our generation.

2015-03-10 'Cheating' for Alpha with Beta by Ryan J. Lehman (Article)

In a recent white paper, our colleagues at GMO very appropriately asked, "Is Skill Dead?" In this paper they examined the results of the large-cap blend peer group, and offered an optimistic outlook for active managers despite recent underperformance. In this article, I expand upon their work and our own by discussing how managers "cheat" for alpha by taking positions in out-of-benchmark risk premia and beta exposures, and how those bets have compromised recent results.

2015-03-10 Use "Self-Distancing" to Make Better Decisions by Daniel Solin (Article)

Before I became a consultant and coach to a number of financial planning firms, I used to run my own investment advisory firm. I believe the advice I give today is far superior to the actions I took when I managed my own firm. Now I understand why.

2015-03-10 President Obama's 2016 Federal Budget Proposal by Tim Steffen (Article)

Both parties are focused on passing some type of tax reform this year, and in order to do that Republicans will likely have to concede on at least some of the president's wishes. Which of those may survive remains to be seen, but it's now up to the Republicans in Congress to respond with a proposal of their own.

2015-03-10 How to Make a Graceful Departure by Beverly Flaxington (Article)

I can't seem to find the magic conditions to make it worth my while to create a succession plan and retire. What advice do you have that might push me to finally figure out how to make a graceful departure?

2015-03-10 Stranded in NYC by Jeffrey Saut of Raymond James

The week began well enough as I arrived Sunday a week ago in Orlando for the 36th annual Raymond James Institutional Investors conference. As previously stated, there were more than 1,000 portfolio managers (PMs) and analysts there to listen to some 300 companies’ presentations. In addition to the PMs and their analysts, our analysts anchored the presentations by the CEOs and CFOs of those companies.

2015-03-10 February Employment Report - Is It Enough? by Scott Brown of Raymond James

Job growth remained strong in February, leading financial market participants to believe that the Fed will begin to raise short-term interest rates sooner (June) rather than later (September) and, more importantly, at a faster pace than thought earlier. The report is only one item that the Fed will consider when it meets to set monetary policy (March 17-18).

2015-03-10 Good News is Still Good News by Brian Wesbury, Robert Stein of First Trust Advisors

The stock market sold off hard last Friday and the reason looks clear: job creation was stronger than the consensus expected in February, the fourth straight month of upside surprises in payrolls.

2015-03-10 On My Radar: Rut Ro Rastro by Steve Blumenthal of CMG Capital Management Group

At the beginning of each month, I like to look at a series of valuation metrics: Median PE, Price to Sales and Price to Operating Earnings. Let’s look at them today. The logic, of course, is simple. When expensively priced, reduce exposure and reduce return expectations. When inexpensively priced, overweight exposure and increase return expectations. Let’s also take a look at what has been driving the market higher. Some argue that individual investors are still on the sidelines. I don’t think so and I show evidence that they are almost as fully invested as they were at the 2000 and

2015-03-10 The 6th Anniversary of 676 by David Edwards of Heron Financial Group

On March 9th, 2009, the S&P 500 made an intra-day and 20 year low at 676.53. Millions of Americans drew a straight line from the mid-September 2008 failure of Lehman Brothers through that March low and projected that the S&P 500 would be zero by June. Armed with that projection, average investors liquidated hundreds of billions of dollars in stock investments, never to return. Those investors will never be able to retire.

2015-03-10 Demographic Trends in the 50-and-Older Work Force by Doug Short (Article)

Note from dshort: I've updated this commentary with the latest numbers from last week's Employment Report.

This is not the scenario that would have been envisioned a generation ago for the "Golden Years" of retirement. Consider: Today nearly one in three of the 65-69 cohort and almost one in five of the 70-74 cohort are in the labor force.

2015-03-10 Will Dow Jones Become the Last Buyer of Apple? by Jerry Wagner of Flexible Plan Investments

Spring arrives in the northern hemisphere this month. Its appearance holds various connotations to different people, although my unscientific poll of a few random individuals leads me to believe the majority of the population has a positive bias toward its arrival. Daylight Savings Time has already kicked in, and soon winter’s frozen landscapes thaw, daylight hours lengthen, flowers bloom, and the frequency of outdoor activities increases. Ah, spring time!

2015-03-10 Stock and Bond Funds Grow with the Flows by Milton Ezrati of Lord Abbett

No redistribution here: Even as equity fund flows have turned positive, bond funds continue to see inflows. Here’s a closer look at the trend—and what it means for investors.

2015-03-10 Happy Birthday Bull Market by Burt White of LPL Financial

The current bull market celebrates its sixth birthday today (March 9, 2015). Bull markets do not die of old age, they die of excesses, and we do not see evidence of excesses emerging today. Some of our favorite leading indicators suggest the economic expansion and bull market may continue through the end of 2015.

2015-03-10 Good luck, Jonathan. Good luck, Nigeria. by Kaisa Stucke of Confluence Investment Management

This week we look at the upcoming Nigerian presidential election and how the persistent threat of the Boko Haram terrorist movement has complicated the democratic process. The election promises to be a close one between the incumbent, Goodluck Jonathan, and a former military leader, Muhammadu Buhari. In turn, we look back at the 2011 presidential election and analyze how that election facilitated the rapid spread of Boko Haram. Exacerbating matters further, the country suffers from a deepening divide between the Christian south and the Islamic north, which we discuss in detail in this report.

2015-03-10 Q&A with Jeff Knight: What’s in store for 2015? by Jeff Knight of Columbia Management

I believe we are still going through a process that is flattering to financial market returns. But after six years and a tripling of the stock market, recognize that we're getting late in the game. Does Europe hang together? Do events in the Ukraine or Greece disrupt the economic recovery in Europe? Is the Fed’s tightening appropriate, or does it represent a threat to financial markets? Will those who come out on the short end of oil’s dramatic repricing emerge as a threat to capital markets either through default and bankruptcies, or worse through geopolitical tensions?

2015-03-10 Why Holding Cash May Mean Losing Money by Russ Koesterich of BlackRock

There are many reasons to hold cash in your portfolio, but sometimes it can be too much of a good thing. Russ Koesterich explains the risks of a large cash position and offers some alternatives.

2015-03-10 Never Smile at a Crocodile by John Mauldin of Mauldin Economics

We will briefly survey my worry closet today before resuming our series on debt, in which we’ll encounter Paul Krugman’s lament that “Nobody understands debt.”

2015-03-10 Structural Trends in Employment by Age Group by Doug Short (Article)

The Labor Force Participation Rate (LFPR) is a simple computation: You take the Civilian Labor Force (people age 16 and over employed or seeking employment) and divide it by the Civilian Noninstitutional Population (those 16 and over not in the military and or committed to an institution). The result is the participation rate expressed as a percent.

2015-03-09 Inside the World of Multiple Jobholders: Two Decades of Trends by Doug Short (Article)

What are the long-term trends for multiple jobholders in the US? The Bureau of Labor Statistics has two decades of historical data to enlighten us on that topic, courtesy of Table A-16 in the monthly Current Population Survey.

At present, multiple jobholders account for about five percent of civilian employment. The survey captures data for four subcategories of the multi-job workforce, the current relative sizes of which I've illustrated in a pie chart.

2015-03-09 What Does That Difference Mean? by John Hussman of Hussman Funds

The difference between actual market returns over a given time period, and the returns that one would have projected earlier based on reliable valuation measures, is extremely informative about where current valuations stand, and about where future market returns are headed.

2015-03-09 ISM Data for January and February Point to Modest U.S. Real GDP Growth in 2015 Q1 by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) released data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers, and the media as they provide the earliest reading on the current state of the economy.

2015-03-09 Recession Probability Models - March 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession. While I don’t agree with the methodologies employed or probabilities of impending economic weakness as depicted by the following two models, I think the results of these models should be monitored.

2015-03-09 An Overview of Alternative Investments by Michael Winchell of Larkin Point Investment Advisors LLC

If you have been thinking about adding alternative investments to your clients’ portfolios, it’s important to step back and analyze the various types of investments available to you—which, despite being lumped together in the same category, have become increasingly varied.

2015-03-09 The Stock-Bond Disconnect by Kenneth Rogoff of Project Syndicate

How should one understand the disconnect between the new highs reached by global equity indices and the new depths plumbed by real interest rates worldwide? Several competing explanations attempt to reconcile these trends, and getting it right is essential for calibrating monetary and fiscal policy appropriately.

2015-03-09 The Dollar isn’t the Peso anymore (Part II) by Richard Bernstein of Richard Bernstein Advisors

The US dollar rally is in its seventh year and we expect this trend to continue. Many observers, including the Fed, continue to worry about inflation. However, we think a strong USD and disinflation/deflation seem more likely than inflation so long as global overcapacity forces nations to fight for market share and depreciate their currencies.

2015-03-09 Personalized Risk Management: Helping Clients Make Smarter Decisions about Their Money by Patty Quinn McAuley of Clark Capital Management Group

Patty writes about helping clients achieve successful investment outcomes and about communicating effectively with clients.

2015-03-09 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Last week we highlighted several signs coming from Twitter that a short term top was in the making. One of them was Twitter momentum for the S&P 500 Index (SPX) turning down from over bought levels and at the same time creating a negative divergence. This week momentum is warning that the selling we saw last week will most likely continue. After painting a negative divergence, 7 day momentum has broken its newly formed uptrend line. This suggests that investors and traders are not committed and were quick to exit positions established during the February rally.

2015-03-09 Why Is the Fed’s James Bullard Optimistic about the U.S. Economy? by Jeremy Schwartz of WisdomTree

On February 20, Professor Jeremy Siegel and I had the pleasure of speaking to St Louis Federal Reserve Bank (Fed) president James Bullard, who is a member of the Fed monetary policy committee. 2015 is shaping up to be an interesting year for monetary policy, with the Fed expected to hike interest rates.

2015-03-09 Ratio of Part-Time Employed Still Remains Higher Than the Pre-Recession Level by Doug Short (Article)

Let's take a close look at Friday's employment report numbers on Full and Part-Time Employment. Buried near the bottom of Table A-9 of the government's Employment Situation Summary are the numbers for Full- and Part-Time Workers, with 35-or-more hours as the arbitrary divide between the two categories. The source is the monthly Current Population Survey (CPS) of households. The focus is on total hours worked regardless of whether the hours are from a single or multiple jobs.

2015-03-08 Weighing the Week Ahead: Is Good News Now Bad for Investors? by Jeff Miller of New Arc Investments

Anyone who wants to speculate on what the Fed is thinking must include some actual evidence from past transcripts. If, for example, you want to suggest that the Fed “wants a market correction” (you can’t make this stuff up) then you have to find at least one historical example where some participant raised that idea. Otherwise, shut up!

2015-03-07 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Quantitative easing comes to the eurozone; U.S. job growth is strong, but wage growth is not; The California port strike has troubled trade... and economists

2015-03-07 The Strong USD Is Negatively Impacting US Trade by Team of GaveKal

Exports have been a solid contributor to US GDP growth for the last few years, while consumption and residential investment have been more restrained. Recently, with consumption firming and likely to improve further from the tail-wind of lower oil prices, and exports faltering, it appears the drivers of the US economy are trading places. It appears that we should expect trade to subtract from growth in the coming quarters.

2015-03-07 The Search for a Low Expense Ratio Ends Here by Rob Isbitts of Sungarden Investment Research

The investment of the decade is not mutual funds or ETFs. It is individual stocks. You may just not realize it yet.

2015-03-07 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.6, unchanged from the previous week. The WLI annualized growth indicator (WLIg) is at -4.6, down from the previous week's -4.5 but off the interim low of -5.0 in mid-January.

2015-03-07 The Official Unemployment Rate is Meaningless by Steve K. Rumsey of Optimus Advisory Group

The Bureau of Labor Statistics (BLS) official unemployment report, also known to economic wonks as U-3, has historically been used to give a fairly accurate depiction of the overall employment situation in our country. Not anymore. This "depiction" of the jobs/employment environment is now meaningless.

2015-03-07 Trampled Under Foot: Earnings Estimates Crushed; But Not Stocks by Liz Ann Sonders of Charles Schwab

The pace of earnings estimate cuts by Wall Street analysts and companies has been well sharper than the norm, suggesting the bar has now been set so low as to make it easier to hurdle. That’s what investors can hope for heading into the next earnings season; but the risk around earnings and valuation is unquestionably higher than it’s been in some time.

2015-03-07 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

Our overall view continues to be that 2015 will not be like 2013 or 2014. This is a year where fundamentals improve while equity prices mark time, allowing sentiment and valuation to fall back inline. This is a common pattern: large parts of 1994, 1996, 1998, 1999, 2004 and 2005 were similar. That November and December were the first back to back down months in 3 years bears out the change in character.

2015-03-07 After a Dismal 2014 Business Development Companies Poised to Outperform in the New Year by Grier Eliasek of Prospect Capital Corp.

After a dismal performance in 2014 business development companies are enjoying a reversal of fortune, floating to the top of the leaderboard in the New Year. They’re outpacing their interest-rate sensitive brethren, utilities and REITs, bonds and the S&P 500 alike amid widespread anticipation that the Federal Reserve will lift interest rates mid year. As the stock market grows ever more expensive and profit margins are reaching record highs, the catalysts that should drive outperformance in BDCs grow stronger and stronger considering that most BDCs are trading at single-digit multiples.

2015-03-06 Taking a Multi-Asset Approach to Inflation by Duy Nguyen of Invesco Blog

With more than two decades of stable inflation in the US and forecasts calling for moderate inflation in the short term, many investors have become complacent about the risk of inflation to the real value of their portfolios. But inflation can change unexpectedly, and although we don’t believe that change is necessarily imminent, investors should remain vigilant about addressing this risk.

2015-03-06 Hot and Cold Bonds by Anthony Valeri of LPL Financial

January 2015 was the best month for high-quality bonds since December 2008. In February 2015, high-quality bonds posted their worst monthly performance since June 2013 and the taper tantrum sell-off. High-yield bonds experienced ups and downs thus far in 2015. After a muted January, high-yield bonds returned 2.4% in February, the largest single month gain since October 2013. After a wild first two months, we expect more muted returns over the remainder of 2015.

2015-03-06 Market Fragility and Opportunity by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup Advisors

Investing is a funny business. It is usually wise to invest the opposite of how the market feels to you. Six years ago stocks had fallen by 50%, the financial institutions that underlie our global economy were buckling, and the economy was in shambles. Investors were running from the stock market in droves. But because prices and expectations were low and because all the major central banks flooded the world with liquidity it was actually a great time to invest.

2015-03-06 Opportunities in Global Financial Disintermediation by Dave Gallagher of Calamos Investments

Increasing financial disintermediation is a strong secular theme providing tailwinds in several financial industries, but a likely arduous and complicated process warrants the need for a disciplined focus on both risk and reward. The financial system essentially performs one basic function—the direct or indirect movement of funds from savers to borrowers or investors. Although financial disintermediation is formally defined as the shifting of funds from indirect to direct financing, the term is more commonly used to describe the increasing role of non-bank intermediaries.

2015-03-06 The Great Monetary Expansion by Scott Minerd of Guggenheim Partners

While winter weather will likely distort first-quarter economic data, accommodative monetary policy around the world means the long-term outlook remains positive.

2015-03-06 Malaysia: Too Indebted to Spend? by Satya Patel of Matthews Asia

Many Asian households are dependent on debt. Malaysia has been working to reshape its economy while addressing the risk of high household debt levels. Asia Weekly examines this issue.

2015-03-06 China’s Reforms: Will They Work? by Hayden Briscoe of AllianceBernstein

The internationalization of China’s currency is proceeding hand in hand with the liberalization of the country’s capital markets. If China can surmount its short-term challenges, the impact of these reforms on global economies and markets should be profound.

2015-03-06 ECB Asset Purchases = (Big) Equity Decline? by Team of GaveKal Capital

We have commented quite a bit on the dismal revisions to sales and earnings estimates (see here, here, and here for just a few examples). As we have noted, European stocks have excelled in the downgrade department, led by the Energy sector.

2015-03-06 Growth Surprises and Possible Risks by Bill McQuaker (Article)

Bill McQuaker, Co-Head of Multi Asset, provides an update on the positive surprises that have unfolded recently in European data, the extent to which that has been reflected in prices and a few risks to keep an eye on mid-year.

2015-03-06 On the Investment Process of a Global Generalist by Jason Brady of Thornburg Investment Management

The process and logic behind the security selection and the construction of portfolios is, in many ways, as complex as the markets themselves. A portfolio of 50 holdings culled from only 500 possible choices leads to: 500!/(50!*(450!)) or 2.31442 x 1069 potential portfolios! That’s a lot of potential outcomes, and this doesn’t even take into account the various possible weights of those choices.

2015-03-06 Surprisingly Strong Jobs Growth in February by Doug Short (Article)

Today's report of 295K new nonfarm jobs in January was well above the forecast of 240K. However, January nonfarm payrolls were revised downward by 18K from 257K to 239K. The unemployment rate ticked down from 5.7% to 5.5%.

2015-03-06 The Civilian Labor Force, Unemployment Claims and the Business Cycle by Doug Short (Article)

What does the ratio of unemployment claims tell us about where we are in the business cycle and our current recession risk? At present, the ratio for Continued Claims has been trending down. Excluding the 1981 recession, the Initial Claims trough lead time for a recession has ranged from 7 to 22 months with an average of 12 months if we include the 1981 recession and 14 months if we exclude it.

2015-03-05 Treasury Snapshot: Where Are Yields Headed? by Doug Short (Article)

With Quantitative Easing behind us as well as the Fed's first semi-annual congressional testimony, let's take a quick look at US Treasuries. The yields on the 10-, 20- and 30 year Treasuries had trended downward rather dramatically since the end of 2013. They hit their recent lows at the end of January. The 20- and 30-year yield hit record closing lows of 2.04% and 2.25%, respectively. The yield on the 10-year Note closed at 1.68%, substantially off its 3.04% close at the end of 2013 but above its 1.43% historic low in July of 2012.

2015-03-05 Another Bubble? by Burt White of LPL Financial

The Nasdaq Composite just hit 5000 today as this report was going to press and is nearing its all-time record closing high of 5048. Even with the Nasdaq at 5000, we do not believe stocks have reached bubble territory. The Nasdaq has a much stronger foundation today of valuations, profits, and sentiment.

2015-03-05 Don’t Audit It: Reign It In by Brian Wesbury of First Trust Advisors

Some in Congress want to “Audit the Fed.” But an audit, unless the word is used in a very broad sense, would be redundant and basically irrelevant. The Fed is already audited, by Deloitte & Touche LLP and it releases an annual report that includes the auditor’s opinion, each year.

2015-03-05 Positioning U.S. Community Bank Investment Portfolios for 2015 by Chitrang Purani, Thomas Luciano of PIMCO

When market uncertainty is elevated and bank profitability is an ongoing concern, taking an extreme view toward investing cash or harvesting liquidity is not optimal. Currently, we do not see as much value in interest rate or duration risk for bank portfolios as yields imply a moderate path for future policy rates. We believe there are opportunities for banks to earn income without taking excess interest rate risk or limiting flexibility against the need to fund future opportunities.

2015-03-05 A Fair Hearing for Sovereign Debt by Joseph Stiglitz, et al. of Project Syndicate

Last July, when US federal judge Thomas Griesa ruled that Argentina had to repay in full the "vulture" funds that had bought its sovereign debt at rock-bottom prices, the decision reverberated far and wide, affecting bonds issued in a variety of jurisdictions. Do US court rulings really apply to contracts executed in other countries?

2015-03-05 The High Yield Default Outlook by Heather Rupp of AdvisorShares

We see default risk as the most prominent risk for credit investors. As we look forward, a benign default environment is projected over the next few years.

2015-03-05 The Dollar Is Breaking Out Again And What That Means For Stocks by Team of GaveKal Capital

The ICE US dollar index looks to have broken out of what has been a rather short-lived consolidation after the massive move since the middle of 2014. If this is in fact the start of another round of dollar strength, then stock investors should carefully consider where in the world to deploy cash into stocks. For a variety of cyclical and structural reasons, certain regions of the world tend to outperform in periods of USD strength and others lag. We'll try to shed some light on that with the below charts.

2015-03-05 Searching for Yield Down Under by Russ Koesterich of BlackRock

The persistence of low yields has had investors searching for income high and low for a while now. Recently, investors are expanding their hunt to some less than obvious places.

2015-03-05 India the Best-Performing Emerging Market by Frank Holmes of U.S. Global Investors

India had an incredible banner year. The world’s largest democracy, home to 1.25 billion people, was the best-performing emerging market in 2014, delivering over 29 percent. It was followed by the Philippines in second place and Indonesia in third.

2015-03-05 Greek Problems Born from Socialism by John Browne of Euro Pacific Capital

Like many of the important discussions in the economic world today, the negotiations between Greece and its European creditors has become increasingly absurd . Late on Friday, February 20, in a tense meeting between the new Greek Finance Minister and a host of ministers from 19 Eurozone countries, Germany apparently 'authorized' negotiators to accept a four-month extension of the $272 billion bailout so long as the Greeks promised to make a series of difficult fiscal steps needed to stay solvent over that time frame.

2015-03-04 Anticipating the Employment Report for February by Doug Short (Article)

The economic mover and shaker this week is the Friday employment report from the Bureau of Labor Statistics. This monthly report contains a wealth of data for economists, probably the most publicized in the near term being the month-over-month change in Total Nonfarm Employment (the PAYEMS series in the FRED repository).

Today we have a February estimate of 212K new nonfarm private employment jobs from ADP. The 212K estimate came in below the forecast of 220K for the ADP number.

2015-03-04 Light Vehicle Sales Per Capita: A Better Look at the Long-Term Trend by Doug Short (Article)

For the past few years I've been following a couple of transportation metrics: Vehicle Miles Traveled and Gasoline Volume Sales. For both series I focus on the population adjusted data. Let's now do something similar with the Light Vehicle Sales report from the Bureau of Economic Analysis. This data series stretches back to January 1976. Since that first data point, the Civilian Noninstitutional Population Age 16 and Over (i.e., driving age not in the military or an inmate) has risen 61.7%.

2015-03-04 Municipal Market Perspectives by Fixed Income Team of SMC Fixed Income Management

A much colder than normal winter throughout the United States has impacted daily activities. Folks are remaining indoors and waiting for the March thaw. Not only are there fewer pedestrians, but runners are a rare sight. The logical inference is that many dedicated exercisers have retreated to the warmth of their basements or local health clubs for exercise, and are instead logging miles on stationary treadmills.

2015-03-04 January Inflation Turns Negative - Is Deflation Upon Us? by Gary Halbert of Halbert Wealth Management

Consumer prices fell in January for the third straight month, while inflation over the past 12 months turned negative for the first time since 2009, largely because of cheaper gasoline. In January, the Consumer Price Index sank by a seasonally-adjusted 0.7%, the biggest one-month drop since the end of 2008, the Labor Department reported Thursday.

2015-03-04 A Plurisy Of Madness by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

When old grandpa Demographus entered the room and started speaking of the changing trends in business, with a growing number of workers retiring and his best clients spending less, attention was dispersed. Distraction and entertainment were provided by granny Janet.

2015-03-04 The Misery Index by John Canally of LPL Financial

Reports on the CPI and unemployment rate for January 2015 sent the Misery Index down to 5.6%, its lowest level in 56 years. Despite the low reading of the index, headlines and polls indicate the index may not be capturing the nation’s mood. Wage growth may be the key to improving consumer sentiment about the state of the U.S. economy.

2015-03-04 The Millennial Obsession by Jerry Wagner of Flexible Plan Investments

You cannot pick up a business publication, tune into a financial news program, or glance at any news website without confronting yet another story on Millennials.

2015-03-04 Tigers in Africa by Niels Jensen of Absolute Return Partners

This month's Absolute Return Letter is about unrealistic expectations which is something we are all guilty of from time to time. We look at why it is unrealistic to expect equity returns to be in the double digit range over the next several years, why central banks are not printing money like many believe, plus a few other topics.

2015-03-04 ISM Non-Manufacturing: Continued Growth in February by Doug Short (Article)

Today the Institute for Supply Management published its latest Non-Manufacturing Report. The headline NMI Composite Index is at 56.9 percent, up fractionally from last month's 56.7 percent. Today's number came in above the forecast of 56.5.

Here is the report summary:

2015-03-03 Howard Marks on Luck and Skill in Investing by Justin Kermond (Article)

When Howard Marks graduated from the Booth School of Business of the University of Chicago, he was turned down for the one job he really wanted. That, he said, was the luckiest moment of his career. The firm that turned him down was Lehman Brothers.

2015-03-03 Dan Fuss - The New Factor in the Bond Markets by Robert Huebscher (Article)

Dan Fuss' career in the bond market has spanned over 50 years. During that time, Fuss has spoken regularly at CFA luncheons. Last week in Boston, he began by warning that what he had to say would be markedly different from any of his previous talks.

2015-03-03 Why Networking Makes You Feel Dirty - New Research: The Mindset for Effective Networking by Dan Richards (Article)

Talk to advisors about networking and you will hear two main complaints: It's uncomfortable to introduce yourself to people you don't know, and it doesn't work. Many advisors have tried without success to convert community activity into new clients. Networking might make these advisors feel "dirty."

2015-03-03 Are DFA's Funds Active or Passive? by John Coumarianos (Article)

Larry Swedroe's recent critique of Graham and Dodd value investing mischaracterized DFA's value funds as "passive." Beyond that, he misread James Montier's discussion of "perfect" value investors, made unfair comparisons among funds and didn't measure risk properly.

2015-03-03 How to Tell If a Prospect Is Interested by Daniel Solin (Article)

Your presentation materials may be eminently persuasive and your delivery equally flawless, but your prospect's mind may be on an entirely different topic. Here's how to tell if your prospect is listening and - more importantly - interested in what you are saying.

2015-03-03 Can Aggressive Sales and Quality Service Co-Exist? by Beverly Flaxington (Article)

Providing the highest quality client service and finding time to network and uncover new sales is challenging at best and impossible at worst. Can these two goals coexist and be achieved?

2015-03-03 The Four Totally Bad Bear Recoveries: Where Are We Now? by Doug Short (Article)

This chart series features an overlay of the Four Bad Bears in U.S. history since the market peak in 1929. They are:

  1. The Crash of 1929
  2. The Oil Embargo of 1973
  3. The 2000 Tech Bubble bust and,
  4. The Financial Bubble and Crisis.

2015-03-03 Reasonably Confident by Scott Brown of Raymond James

Fed Chair Janet Yellen signaled that officials will likely alter the forward guidance at the March 17-18 policy meeting. However, altering this guidance (the conditional commitment to keep short-term interest rates exceptionally low) is not the same as signaling that a rate hike is imminent, as Yellen made clear. She did indicate what would lead the Fed to start tightening.

2015-03-03 Is Japan Zimbabwe? by Axel Merk of Merk Investments

Is Japan Zimbabwe? How preposterous: Japan is an advanced economy that cannot possibly suffer the same fate as Zimbabwe. Right? Or could Japan get hyperinflation? Below I explain why Japan, and with it investors’ portfolios, might be at risk.

2015-03-03 The Return of the Comeback: Is 2015 the Year for International Stocks? by Zachary Karabell of Envestnet

For several years, many professional investors and advisers have been bullish about the prospects for investing outside the United States. Calls to overweight European stocks or global stocks have been typical each January for the past years, and this year is no different.

2015-03-03 The Euro: How Low Can It Go? by Jeremy Schwartz of WisdomTree

Recently, Professor Jeremy Siegel and I sat down with Brown Brothers Harriman currency strategist Marc Chandler. Given the European Central Bank’s (ECB) recent activities, most of the discussion centered around the euro.

2015-03-03 Yemen: A Land with a Rich Past and a Poor Present by Kaisa Stucke of Confluence Investment Management

The country of Yemen is slowly dissolving in the midst of an ongoing civil war. The Houthi movement has aggressively secured territories in the north, while al-Qaeda has widened its activities in the south. Outside powers are watching these developments closely. Yemen’s neighbor and U.S. ally, Saudi Arabia, would like to see the Houthi insurgency stopped as the group is widely viewed as a proxy for Iran. At the same time, the U.S. has been a partner to Yemen in fighting al-Qaeda in the Arabian Peninsula, but the fall of its government has left the U.S. without a formal partner.

2015-03-03 The Conference by Jeffrey Saut of Raymond James

Greetings from Orlando where the Raymond James 36th Annual Institutional Investors Conference is in full swing. At this year’s conference there will be more than 1,000 portfolio managers (PMs) and analysts, as well as more than 300 companies presenting. In a past life I used to attend many of Wall Street’s institutional investors conferences, but have come to like ours the best.

2015-03-03 Buffett on the Value of Patient Optimism by William Smead of Smead Capital Management

Like picking up the Good Book, a read of Berkshire Hathaway’s Annual Shareholder Letter yields insight, wisdom, and encouragement for the long-duration common stock investor in a world of short-term thinking and 30-second sound bites.

2015-03-03 The Benefits of Tiny Withdrawal Rates by Roger Nusbaum of AdvisorShares

For about the last year we have been blogging about the concept known as tiny houses. In that time interest has proliferated in terms of new websites devoted to the concept as well as at least four TV shows about tiny houses. The show Portlandia just had a bit making fun of tiny houses in a sketch where the toilet and the office were the same space as was the bathtub/shower and TV area.

2015-03-03 Market Valuation, Inflation and Treasury Yields: Clues from the Past by Doug Short (Article)

My monthly market valuation updates have long had the same conclusion: US stock indexes are significantly overvalued, which suggests cautious expectations on investment returns. In a "normal" market environment -- one with conventional business cycles, Federal Reserve policy, interest rates and inflation -- current valuation levels would be a serious concern.

But these are different times.

2015-03-03 The Market Moves Higher into Overvaluation Territory by Doug Short (Article)

Here is a summary of the four market valuation indicators I updated at the beginning of the month.

  • The Crestmont Research P/E Ratio
  • The cyclical P/E ratio using the trailing 10-year earnings as the divisor
  • The Q Ratio, which is the total price of the market divided by its replacement cost
  • The relationship of the S&P Composite price to a regression trendline

2015-03-02 PCE Price Index: Inflation Slips Further Below the Fed Target by Doug Short (Article)

The latest Headline PCE price index year-over-year (YoY) rate is 0.22%, down from 0.77% the previous month. The Core PCE index of 1.31% is little changed from the previous month's 1.34% YoY.

The adjacent thumbnail gives us a close-up of the trend in YoY Core PCE since January 2012. I've highlighted the 12 months consecutive when Core PCE hovered in a narrow range around its interim low, a level to which it has returned in the last two months.

2015-03-02 Two Measures of Inflation and Fed Policy by Doug Short (Article)

Note from dshort: I've updated the accompanying charts with the latest Personal Consumption Expenditures price index from the Bureau of Economic Analysis. The annualized rate of change is calculated to two decimal places for more precision in the side-by-side comparison with the Consumer Price Index.

The BEA's Personal Consumption Expenditures Chain-type Price Index for January shows core inflation below the Federal Reserve's 2% long-term target at 1.31%. The latest Core Consumer Price Index release, also data through January, is higher at 1.65%.

2015-03-02 Is the Stock Market Cheap? by Doug Short (Article)

Here is a new update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month, which is 2,082.20. The ratios in parentheses use the monthly close of 2,104.50. For the earnings, see the table below created from Standard & Poor's latest earnings spreadsheet.

2015-03-02 Regression to Trend: A Perspective on Long-Term Market Performance by Doug Short (Article)

Quick take: At the end of January the inflation-adjusted S&P 500 index price was 96% above its long-term trend, up from 91% above trend the previous month.

2015-03-02 The S&P 500, Dow and Nasdaq Since Their 2000 Highs by Doug Short (Article)

Here is a update in response to a standing request from a couple of sources that I also share with regular visitors to my Advisor Perspectives pages. The request is for real (inflation-adjusted) charts of the S&P 500, Dow 30, and Nasdaq Composite. In response, I maintain two overlays — one with the nominal price, excluding dividends, and the other with the price adjusted for inflation based on the Consumer Price Index for Urban Consumers (which is usually just refer to as the CPI).

2015-03-02 Secular Bull and Bear Markets by Doug Short (Article)

Was the March 2009 low the end of a secular bear market and the beginning of a secular bull? At this point, over five-and-a-half years later, the S&P 500 has set an inflation-adjusted record high.

Let's examine the past to broaden our understanding of the range of historical trends in market performance. An obvious feature of this inflation-adjusted series is the pattern of long-term alternations between up-and down-trends.

2015-03-02 Going to the Dogs by Bill Gross of Janus Capital Group

If you were a dog, what kind would you be? I can’t say I’ve thought about it a lot myself, but it is an interesting, possibly introspective question considering the theory that many dog owners pick a breed that looks or perhaps acts like themselves.

2015-03-02 Value Oriented Bond Management by Jerry Paul, Zach Jonson of ICON Advisers, Inc.

Equity investors can be categorized into a broad range of equity strategies, including valuation-based approaches, whereas bond investors generally think in terms of interest rates and duration management. Professional investment managers have been taught that the market is efficient and while this may often be true, we believe there are a number of select areas within the bond market that exhibit less efficient behavior. This paper will discuss these potential inefficiencies and how “value oriented” bond management looks to exploit the inefficiencies. First we need to define “traditi

2015-03-02 Why We Invest in Royalty Companies by Frank Holmes of U.S. Global Investors

Royalty companies basically serve as specialized financiers that help fund cash-strapped miners’ exploration and production projects. In return, they receive either royalties on whatever the mine produces or what’s known as a “stream,” which is a commitment to an agreed-upon number of ounces of gold or other precious metal per year.

2015-03-02 The Most Important Number No One Is Talking About by Russ Koesterich of BlackRock

Economists are divided over the reasons behind the slowdown in U.S. productivity growth, but its effects on future economic growth are unquestionably negative.

2015-03-02 States Feel Impact of Oil Price Collapse by Joseph Rosenblum of AllianceBernstein

Crude oil prices have fallen sharply since last summer, a bright spot for American consumers. Major oil-producing states aren’t as happy, because the loss in tax revenue is impacting budgets and economies. Some states will face real hardship; others will emerge relatively unscathed.

2015-03-02 The Return of the Comeback: Is 2015 the Year for International Stocks? by (Article)

Will 2015 finally be the year for international stocks? Year-to-date performance suggests yes, as do proclamations by renowned market experts. But the case is far from clear or settled.

2015-03-02 US Economy: Cooler Than Consensus by Brian Horrigan of Loomis Sayles

The rebound is over, and we can’t just blame the dreadful winter weather. Much recent data have been disappointing. Even though I believe they are not bad enough to be recessionary signals, they do suggest that the recovery going forward may be a bit blander than hoped.

2015-03-02 On My Radar: Equity Valuations, Recessions and Market Declines by Steve Blumenthal of CMG Capital Management Group

Today let’s take a look at the hard evidence signaling slowdown. My personal view is that slowdown would not be as much of a problem if valuation measures were low. They’re not: by just about every measure the market is overpriced, overbought and over believed. What can you do? I share a simple and disciplined rules based way for you to stay invested in the market’s primary trend.

2015-03-02 What’s Really Driving the Value of the Euro and Yen? by Bradley Krom of WisdomTree

With a majority of developed markets rallying strongly over the last several years, we think the single biggest determinant for investors actually being able to capture those returns has hinged on their ability to manage currency risk.

2015-03-02 Markets Pause While Awaiting Federal Reserve Activity by Robert Doll of Nuveen Asset Management

U.S. equities were mixed last week, with the S&P 500 declining -0.2%. The Federal Reserve (Fed) had a busy week, as the nuanced debate continues around when to begin policy normalization. The global policy divergence grabbed headlines, but the focus was mainly on negative yields in Europe and inflows to non-U.S. equities.

2015-03-02 Today’s Floating Rate Loan Market by Heather Rupp of AdvisorShares

Together the high yield bond and floating rate bank loan market total over $3 trillion.1 This has evolved into a significant, and growing asset class. With high yield bonds and loans now representing about 30% of corporate credit2, this market deserves not only our attention, but we also feel is ripe with opportunity for investors.

2015-03-02 Fed Has Less Patience For ZIRP by Brian Wesbury, Robert Stein of First Trust Advisors

Economic data will have something for everyone this week. The ISM reports (manufacturing and non-manufacturing) will likely be held down by unusually harsh weather and the Port closures. But, autos sales should remain strong and January jobs data are set for a gain close to 250,000.

2015-03-02 Royce Premier Fund: Reviewing 2014 and Positioning for 2015 by (Article)

Portfolio Manager Lauren Romeo talks about the relative performance challenges for Royce Premier Fund and the types of businesses we are emphasizing and avoiding.

2015-03-02 Bill Hench on Consumer and Tech Stocks by (Article)

A bottom-up stock picker, Portfolio Manager Bill Hench is finding compelling valuations in the semiconductor industry. Bill also believes many Consumer Discretionary stocks are poised to benefit from the recent decline in energy prices.

2015-03-02 Why Puerto Rico may now be stuck in “no man’s land” by Municipal Insight Committee of Eaton Vance

Our Municipal Insight Committee examines the island’s significant short- and long-term liquidity challenges, and what they mean to muni bond investors.

2015-03-02 ISM Manufacturing Index: ISM Manufacturing Index: Slowest Growth in Thirteen Months by Doug Short (Article)

Today the Institute for Supply Management published its monthly Manufacturing Report for February. The latest headline PMI was 52.9 percent, a decline from the previous month's 53.5 percent and below the forecast of 53.0. This was the lowest PMI since January 2014, thirteen months ago.

Here is the key analysis from the report:

2015-03-02 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Over the past week we got several signals from the Twitter stream that a short term top is likely. At the very least we should see a choppy market rather than a strong rally higher.

2015-03-02 Nevis & NASDAQ 5000 by Doug MacKay, Bill Hoover of Broadleaf Partners

Fifteen years ago, the tech-stock heavy, dot-com laden NASDAQ hit 5000, a level it hasn't seen since - until today - March 2nd, 2015. Whether or not it will maintain a closing price above 5000 remains a work in progress, but in all likelihood, we'll get there.

2015-03-02 The Herd Can Be Blind by Peter Schiff of Euro Pacific Capital

Going into 2015 the economic outlook held by the U.S. investment establishment could not have been much more positive, and more unified. Pundits saw all the variables aligning to create the best of all investment worlds, a virtual "no-brainer" of optimism. Many believed that the 5.0% annualized growth in 3rd quarter would stay strong in the 4th Quarter and then usher in a strong 2015, which many believed would be the best economic year since the crash of 2008. The only question that divided most forecasters was how good the year would be.

2015-03-02 Obama Comments on IRA Fiduciary Rules by Andrew Friedman of The Washington Update

Last week the President gave a speech in which he focused on forthcoming Labor Department rules intended to ensure that IRA holders receive investment advice unencumbered by financial advisor conflicts of interest. In conjunction with the President’s speech, the Labor Department will be re-issuing proposed rules addressing the extent to which financial advisors may receive compensation in connection with investments made by IRAs and other retirement accounts they advise. The new proposed rules should be available in the next 60-90 days.

2015-03-02 A Greek Tragedy Averted - for Now by Milton Ezrati of Lord Abbett

While the Tsipras government has bought itself some time, the possibility of a Greek exit from the eurozone remains quite real—as does the risk to global financial markets.

2015-03-02 Crestmont Market Valuation Update by Doug Short (Article)

Quick take: Based on the February S&P 500 average of daily closes, the Crestmont P/E is now 98% above its arithmetic mean and at the 98th percentile of this fourteen-plus-decade monthly metric.

2015-03-01 Weighing the Week Ahead: Will the Economic News Alter Fed Policy? by Jeff Miller of New Arc Investments

The exact timing of the first Fed rate increase does not matter. There is a difference between tight monetary policy and slightly less accommodative policy. Markets do quite well in the early stages of rising rates, especially when starting from a low initial point. This will be ignored by many who will invoke “Don’t fight the Fed.” This will be the fundamental battleground between traders and investors, bears and bulls, and various political types – perhaps lasting for years. The end of the business or stock market cycle is not imminent. Bull markets do not die of old age.

2015-03-01 Plan to Exit Stocks Within the Next 8 Years? Exit Now by John Hussman of Hussman Funds

Unless we observe a rather swift improvement in market internals and a further, material easing in credit spreads – neither which would relieve the present overvaluation of the market, but both which would defer our immediate concerns about downside risk – the present moment likely represents the best opportunity to reduce exposure to stock market risk that investors are likely to encounter in the coming 8 years.

2015-02-28 Moving Averages: Month-End Update by Doug Short (Article)

Valid until the market close on March 31, 2015

The S&P 500 closed February with a monthly gain of 5.49%, the largest one-month gain in 40 months. All three S&P 500 MAs and four of the five the Ivy Portfolio ETF MAs are signaling "Invested". In the table below, monthly closes that are within 2% of a signal are highlighted in yellow.

2015-02-28 The Most Important Number No One Is Talking About by Russ Koesterich of BlackRock

Economists are divided over the reasons behind the slowdown in U.S. productivity growth, but its effects on future economic growth are unquestionably negative.

2015-02-28 The Negative Way to Growth? by Nouriel Roubini of Project Syndicate

Monetary policy has become increasingly unconventional in the last six years, with central banks implementing zero-interest-rate policies, quantitative easing, credit easing, forward guidance, and unlimited exchange-rate intervention. But now we have come to the most unconventional policy tool of them all: negative nominal interest rates.

2015-02-28 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

When SPY has risen 3 weeks in a row, it most often rises further for at least one more week. SPY has been up 3 weeks in a row 19 times in the past 4 years. In 17 of those 19 times (89%), it continued up at least one more week. In one of those 19 instances, SPY gave back half its gains before going higher (yellow arrow); and in just one instance, SPY gave back 100% of its gains (red arrow).

2015-02-27 NYSE Margin Debt Declined in January by Doug Short (Article)

Unfortunately, the NYSE margin debt data is a month old when it is published. Real (inflation-adjusted) debt hit its all-time high in February 2014, after which it margin declined sharply for two months, but by June it had risen to a level about two percent below its high and then oscillated in a relatively narrow range. The latest data point for January is four percent off its real high eleven month ago.

2015-02-27 Visualizing GDP: A Look Inside the Q4 Second Estimate by Doug Short (Article)

The accompanying chart is my way to visualize real GDP change since 2007. I've used a stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself.

2015-02-27 Moving Averages: Month-End Preview by Doug Short (Article)

Here is an advance preview of the monthly moving averages I track after the close of the last business day of the month. At this point, before the open on the last day of the month, three S&P 500 strategies are now signaling "invested" -- unchanged from last month. One of the five of the Ivy Portfolio ETFs, PowerShares DB Commodity Index Tracking (DBC), is signal "cash" -- down from two from last month. The Vanguard FTSE All-World ex-US ETF (VEU), now fractionally above its MA, was signaling "cash" last month.

2015-02-27 Are Expectations Too High? by Burt White of LPL Financial

The market’s continued ascent has caused some to ask if the stock market reflects excessive optimism. The pace of economic surprises as measured by the Citigroup Economic Surprise Index suggests expectations remain reasonable. We view recent economic disappointments as largely temporary, and would expect the surprise index may reverse recent declines as expectations have come down, providing support for cyclical sectors.

2015-02-27 Lost in Translation: Navigating the Changing Environment for Investment Information by David Robertson of Arete Asset Management

In the best of times, it requires effort and expertise to filter through investment information. Since the financial crisis, however, that challenge has gotten even harder.

2015-02-27 Recession is On the Way: Questioning One's Sanity; Beat the Crowd, Panic Now! by Mike "Mish" Shedlock of Sitka Pacific Capital

In 2006-2007 I called for a recession. We got a big one. I called for another one in 2011, as did the ECRI. That recession never happened. 50% is not a very good recession predicting track record except in comparison to consensus economic opinions that have never once in history predicted a recession. Consensus opinion is batting a perfect 0.00%

2015-02-27 Macro View Rate Hike Rally by Scott Minerd of Guggenheim Partners

The lead-up to the first rate hike by the Federal Reserve is historically a favorable environment for U.S. equities and credit.

2015-02-27 Could Apple Buy a Third of the World’s Gold? by Frank Holmes of U.S. Global Investors

So what’s Apple’s next trick? How about moving the world’s gold market?

2015-02-27 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The U.S. Housing Industry Continues to Struggle; The "Millennials" Hold the Key to Housing; Is Another Bubble Forming in U.S. Commercial Real Estate?

2015-02-27 Focusing on the Three Ds by Byron Wien of Blackstone

Looking forward several years, there will be three important factors that will determine the economic and investment outlook. They are decoupling, deflation and demand.

2015-02-27 With the Bank of Canada, Is the Canadian Economy in Good Hands? by Ed Devlin of PIMCO

A disorderly decline in energy prices could spill over into consumer and business sentiment, which would worsen any drop in Canada's economic output. More rate cuts this year are likely a part of the Bank of Canada's base case scenario. Investors may be able to improve their returns by buying bonds with high-quality credit spreads, including Canadian bank senior debt and Ontario bonds.

2015-02-27 We're Having "Flation" by Rob Isbitts of Sungarden Investment Research

We decided to look back at the last four years and get a sense of what is happening with prices. And, like so many investment discussions these days, our conclusions are not uniform. In the case of consumer prices, we are having inflation, disinflation depending on which major component of the CPI you watch. Conclusion: just as the broad stock market can have many underlying sub-trends within it, so too can that be the case for consumer prices. “Flation” – it is everywhere and of all three types in today’s consumer world.

2015-02-27 On the Long Bond and Why the Widow Maker is Alive and Well by Team of GaveKal

Perhaps one of the most important questions investors need to answer today is whether we've seen the low in the long bonds yields or whether the trend lower is firmly intact. The recent spike in the 10-year bond yields from 1.65% at the end of January to 2.14% just two weeks later has no doubt complicated the situation. In this piece we'll try to layout one case for lower yields still.

2015-02-27 China’s New Generation of Entrepreneurs II by Beini Zhou of Matthews Asia

China has long been perceived to be a breeding ground for business copycats, and has struggled with rampant intellectual piracy. Many businesses there have indeed been founded based on business models that originated in the U.S. or Europe. But what’s been overlooked in recent years is China’s rising “innovation machine.” More favorable government policies toward R&D have helped. This month, Asia Insight takes a look at developments in China’s grassroots-level entrepreneurship.

2015-02-27 Hasenstab on Global Growth: Headwinds or Tailwinds? by Michael Hasenstab of Franklin Templeton

While some forecasters predict gloomy global growth this year, the contrarian-minded Dr. Michael Hasenstab, chief investment officer, Templeton Global Macro Group (formerly known as Templeton Global Bond Group), has a different view. He aims to counter what he sees as “excessive pessimism” surrounding the global economy and outlines why he believes the recent plunge in oil prices could prove a tailwind, not only for economic growth in the United States, but also in Europe. He also offers his scorecard regarding Japan’s monetary policy experiment dubbed “Abenomics.”

2015-02-27 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.6, up slightly from 130.4 the previous week. The WLI annualized growth indicator (WLIg) is at -4.5, down from the previous week's -4.2 but off the interim low of -5.0 in mid-January.

2015-02-27 Rhyming…but not Repeating. by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Stocks have recovered their January losses and have continued to move higher. While economic growth remains solid and we remain secular bulls, investors should be prepared for increased volatility and the potential for a near-term correction. Also, European stocks may be due for at least a pause and we suggest looking to add exposure to emerging market positions if needed. Staying well diversified and keeping an eye on rebalancing is the recommended strategy.

2015-02-27 Power Surge for Women as Emerging Consumers by Tassos Stassopoulos of AllianceBernstein

What’s the connection between electricity and women? Electricity is an agent of empowerment, able to transform societies and economies in emerging markets. It paves the way to buying home appliances like electric cookers, refrigerators and washing machines, freeing up women from hours of daily housework. In our view, more access to power in developing countries will be a catalyst for more women to join the workforce, leading to huge changes in consumer spending patterns.

2015-02-27 Reconnecting with Energy Stocks by Sharon Fay of AllianceBernstein

Plunging oil prices since mid-2014 have led many equity investors to shun energy stocks. We think that’s a mistake. By studying the aftermath of previous oil shocks, we believe investors can gain insight to prepare for a possible rebound.

2015-02-27 Q4 GDP Per Capita Drops to 1.4% by Doug Short (Article)

Earlier today we learned that the Second Estimate for Q4 2014 real GDP came in at 2.2 percent (rounded from 2.19 percent), down from 2.6 percent in the Advance Estimate. Real GDP per capita was lower at 1.4 percent (rounded from 1.43 percent), down from 1.85 percent in the Advance Estimate.

Here is a chart of real GDP per capita growth since 1960. The per-capita calculation is based on quarterly aggregates of mid-month population estimates by the Bureau of Economic Analysis.

2015-02-26 Obama Steps Up by Simon Johnson of Project Syndicate

For the past six years, Barack Obama's administration has, more often than not, sided with the interests of big banks on financial-sector policy. But this week, announcing a new proposal to prevent conflicts of interest in financial advising, Obama seemed to turn an important corner.

2015-02-26 Equity Valuations, Recessions and Stock Market Declines by Doug Short of Advisor Perspectives (

When I initiated the dshort web page in late 2005, one of my routine topics was equity valuations, initially inspired by Nobel laureate Robert Shiller's book, Irrational Exuberance, the second edition of which was published earlier that year. I gradually expanded my focus from his cyclically adjusted price-to-earnings ratio (CAPE) to include Ed Easterling's Crestmont P/E, Nobel laureate James Tobin's Q Ratio and my own monthly regression analysis of the S&P 500.

2015-02-26 Family-Owned Businesses: One More Reason Not to Neglect Emerging Markets by David Ruff of Forward Investing

At the end of a year in which the U.S. handily led the world’s equity markets, many dividend investors find it hard to rouse any interest in emerging markets at all. “Why even bother?” seems to be the prevailing sentiment.

2015-02-26 Yellen’s Trip to the Hill, a Preview… by Scott Brown of Raymond James

Fed Chair Janet Yellen will testify on monetary policy on Tuesday and Wednesday. These appearances are less traumatic for the financial markets than they used to be. The Fed releases minutes of the policy meetings on a timelier basis and the Fed chair holds press conferences after every other meeting. Hence, it’s unlikely that we’ll see Yellen signal a major change in the policy outlook. Still, the financial markets will pay attention.

2015-02-26 Gathering Thin Reeds? by Jeffrey Saut of Raymond James

Many of you know that I spend time gathering “thin reeds” and try to weave them into a favorable “investment bouquet.” This is a strategy Fidelity’s Peter Lynch took to its zenith in an era gone by. Recall the story Peter told about how he stumbled into Magellan Fund’s (FMAGX/$96.12) investment in Hanes, when he first heard his wife rave about a new product called pantyhose.

2015-02-26 Investing in Volatility: Is Asian Volatility Poised to Rise? by David Jubb of Invesco Blog

Volatility is cheap these days. That may sound strange at first. But, the Invesco Multi Asset team views volatility as an investable asset type that can be included in our investment strategy. Why might this make sense? We believe volatility can provide additional diversification and return benefits when combined with our portfolio’s other asset exposures. For example, when volatility is low, markets may benefit. But when it rises, markets can come under pressure.

2015-02-26 Rise in Spanish CDS Outpaces Greece by Team of GaveKal Capital

Unsurprisingly, the cost of insurance against Greek default (as evidenced by 10-year credit default swaps) has risen since the beginning of the year. It is interesting to note, however, that the monthly rate at which Spanish CDS are rising is actually higher, increasing more than 20% according to the most recent data point.

2015-02-26 Monetary Policy Matters by Mark Mobius of Franklin Templeton Investments

This year we expect the divergence in monetary policy among the world’s central banks to be a key theme and a likely driver of asset flows. For now, the scorecard seems to be tilted toward monetary easing since in the first month of 2015 alone, 14 central banks engaged in some form of monetary policy loosening, generally in the form of interest rate cuts or asset purchases.

2015-02-26 Why Does Louis Vuitton Like a Weaker Euro? by Christopher Gannatti of WisdomTree

In an article published January 31, 2013, Bernard Arnault, the chief executive of LVMH, was quoted as saying, “The cloud on the horizon … is the evolution of currencies, [and a strong euro] would have an impact on French exporters and for our group …”

2015-02-26 Viewer Discretion Advised by Dan Walker of Heartland Advisors

Rich valuations for Utility stocks and current low bond yields point to a dim future for the sector.

2015-02-26 Hedge Funds on the Comeback? by Roger Nusbaum of AdvisorShares

A few days ago I stumbled across a post from CIO titled Reports Of My Death Have Been Greatly Exaggerated that chronicles the outflows from hedge funds last year and posits whether a comeback might be around the corner but with generally lower fees. The lower fee angle of the article seemed to focus on negotiating a lower fee with the manager. Of course lower fees are available through the various exchange traded products that one way or another replicate the exposure but doing so without the so called ‘2 and 20’ fee structure.

2015-02-26 Rate Hike Rally by Scott Minerd of Guggenheim Partners

The lead-up to the first rate hike by the Federal Reserve is historically a favorable environment for U.S. equities and credit.

2015-02-25 At a Standstill? - The Debate Over "Secular Stagnation" by Team of Northern Trust

During one particularly stormy day recently, I asked my daughter to unearth herself from the couch and help me clear the snow from the driveway. Unfortunately, the prospective reward of industry was no competition for the television remote, and I was left to fend for myself.

2015-02-25 Putting Declining Sales Estimates In Context by Team of GaveKal Capital

We track analyst estimates in a variety of ways. We look at growth rate expectations over the next four years. We also measure the percent change in the level of USD estimates across various time frames. We also track the difference in growth rates now versus three months ago. Finally, we look at the percent of companies that are experiencing a positive earnings revision over various time frames.

2015-02-25 Complexity, Critical States and Tributaries of Uncertainty by Brooks Ritchey of Franklin Templeton Investments

For long periods of time, the markets can advance relatively smoothly until a sudden onset of chaos occurs, a “tipping point” that quickly changes the picture. Some might say the recent drop in oil would be a case in point. Brooks Ritchey, senior managing director at K2 Advisors, Franklin Templeton Solutions, explores the tipping points that trigger dramatic market turns, and ponders whether he thinks global equities may be teetering on the edge of one today.

2015-02-25 China Levels the Global Playing Field by Hayden Briscoe of AllianceBernstein

It’s a powerful vision for the world’s future. The US and China: two growth powerhouses; two major currencies.

2015-02-25 Greece Clears First Hurdle: More to Come by Russ Koesterich of BlackRock

Early negotiations between Greece and its creditors brought about an extension to the bailout program, but talks could remain contentious. What should investors focus on during this time?

2015-02-25 Lower Lows Still to Come for Silver & Gold by Avi Gilburt of

Yes, I want to be abundantly clear, as some still question my perspective, even though I have reiterated this time and again: I believe metals will see lower lows before this 3+ year correction will end. And, simply because I noted that I was keeping an open mind in January as to the market proving me wrong by completing an impulsive move off the November lows did not change my primary perspective. So, I believe I have been rather consistent and clear that my expectation was and has been that lower lows have yet to be seen to complete this 3+ year correction.

2015-02-25 The Strange World of Negative Interest Rates by Lowell Yura of BMO Global Asset Management

This article examines explanations for negative bond yields. The article argues that central bank policies may be one of the causes. The article also suggests that to make sense of low Treasury yields, investors should be mindful of global yield correlations.

2015-02-25 Equity Valuations, Recessions and Stock Market Declines by Doug Short (Article)

Last week I had a fascinating conversation with Neile Wolfe, of Wells Fargo Advisors, LLC. Based on the underlying data in the adjacent chart, Neile made some cogent observations about the historical relationships between equity valuations, recessions and market prices:

2015-02-24 Consumer Confidence Declined in February by Doug Short (Article)

The Latest Conference Board Consumer Confidence Index was released this morning based on data collected through February 12. The headline number of 96.4 was a decline from the revised January final reading of 103.8, an upward revision from 102.9. Today's number was below the forecast of 99.6.

2015-02-24 Gundlach to the Fed: "Dont Raise Rates" by Robert Huebscher (Article)

The Fed should reject its inclination to raise rates, according to Jeffrey Gundlach. It's rare that he agrees with Larry Summers, but in this case the two believe that the fundamentals in the U.S. economy do not justify higher interest rates.

2015-02-24 An In-Depth Look at the Sequoia Fund by Larry Swedroe (Article)

Looking at its 35-year track record, some now consider the Sequoia Fund (SEQUX) an anomaly; it is an actively managed fund that has persistently generated positive risk-adjusted returns, outperforming its peers and its benchmark. Should investors expect this outperformance to persist?

2015-02-24 The Big Threat to Your Reputation by Dan Richards (Article)

Yelp and other "advisor-ratings" sites give a new platform to former clients who bear grudges. Fortunately, you don't have to be a powerless victim. There are some simple, proactive measures that can help you protect your reputation against unfair reviews.

2015-02-24 The Power of Mimicry by Daniel Solin (Article)

You are in a meeting with a prospect. You want to do everything you can to convert that prospect into a client. What actions can you take to maximize the possibility of success?

2015-02-24 A Lesson from Little League by Martin Weil (Article)

I tip my hat to Little League for the courage of their convictions in how they dealt with the transgressions by Chicago's Jackie Robinson West team. I only wish that the same justice might have been meted out to those firms who gamed the system throughout the 1990s and 2000s.

2015-02-24 A Fresh Look at Life Settlements in 2015 by Stephen Terrell (Article)

Rather than let unneeded term policies expire, clients may be able to sell them to a life insurance settlement provider. Life settlements were historically limited to whole-life policies, but new developments offer advisors greater flexibility to access cash for a variety of insurance products.

2015-02-24 How to Tell Your "Story" Effectively by Beverly Flaxington (Article)

We have been very successful when we sit down with a prospect to tell our story. However, our newest advisors find this more challenging. Our story is clear to them, but it isn't distinct from what they have heard at other firms. How can we reinforce our story or build a new one incorporating ideas from our staff?

2015-02-24 On My Radar: A $9 Trillion Dollar Crisis by Steve Blumenthal of CMG Capital Management Group

Here is the main point of today’s OMR: According to the Bank of International Settlements, non-bank borrowers outside the U.S. have borrowed, in dollars, $9 trillion. This is an increase of $4.5 trillion since the financial crisis and it places that $9 trillion on the wrong side of the dollar bet. The dollar debt is an example of how the Fed’s tightening will impact the world economy. This is a pressure cooker and the pot is starting to boil.

2015-02-24 While the World Is Not Flat, Distributions May Be by William De Leon, Courtney Walker of PIMCO

?Investors have long relied on the assumption that asset returns are normally distributed with correlations that are slow to change. Based on our analysis, however, we now have flat distributions and correlations that are much less stable; a fat-tailed event to either the left or the right is as likely to occur as a non-event. Active management that recognizes and adapts to these changes will be essential to seeking strong returns in the future.

2015-02-24 2015 Leadership: An Early Take by Doug Ramsey of Leuthold Weeden Capital Management

Last year’s economically defensive winners held their grip on stock market leadership in January. This action is consistent with our view that the bull market is an aged, overvalued one that has begun a final “distribution” process that will eventually erupt into a cyclical bear. Like every other facet of the topping process, though, defensive leadership can persist for an extended period—to the point that it’s ignored when there’s a genuine warning to be heard.

2015-02-24 Municipal bonds in 2015: Time to get back to basics by Municipal Insight Committee of Eaton Vance

In this insight, our Municipal Insight Committee examines why munis remain compelling in 2015 after a year of robust performance.

2015-02-24 U.S. Economy: Will Growth Be Roaring, or Boring? by Milton Ezrati of Lord Abbett

Here’s a look at key indicators—and what they signal for the pace of U.S. economic activity.

2015-02-24 Finally, At Least One Financial Media Person Gets It by Jerry Wagner of Flexible Plan Investments

I spent the last two weeks on a Caribbean island (as I always say: Timing is everything!). We rented a house and had lots of visitors from “Up North” (my wife will be there a month and during that time we will have had seventeen people staying in the house!).

2015-02-24 Coffee Camaraderie and Lingering Questions by Michael Kayes of Willingdon Wealth Management

America has the opportunity to lead the world economy far into the future. Read on to find out the key drivers and challenges to global leadership.

2015-02-24 Markets Vs Economy - The Great Disconnect by Lance Roberts of Streettalk Live

Last week, the markets hit new "all-time" highs as Greece caved into the demands of the Eurozone, at least for now, in order to secure funding for another four months. The relief that the latest Eurozone crisis has been resolved sent money flowing into equity markets as investors remain "afraid to miss out" on rising asset prices. The general consensus of analysts and economists is that the rise in capital markets is clearly a sign of economic strength which makes equities the "only game in town" as long as Central Banks stand at the fore.

2015-02-24 Debt Be Not Proud by John Mauldin of Mauldin Economics

Some things never change. Here is Eugen von Böhm-Bawerk, one of the founding intellectuals of the Austrian school of economics, writing in January 1914, lambasting politicians for their complicity in the corruption of monetary policy.

2015-02-24 Détente with Iran: An Update by Bill O'Grady of Confluence Investment Management

This report is an update to a similarly titled piece we published in 2013. In this report, we delve further into what appears to be an evolving policy change by the U.S. with Iran, discussing the basic goals of the U.S. and Iran. With this background, we examine America’s alternatives to achieving our aims in the region, followed by a full examination of U.S. difficulties in making a historic policy change with Iran. We discuss the recent policy pattern in the region and how it supports the notion that improving relations with Iran is probably the reason for this pattern.

2015-02-24 Is Gold Risk Free? by Axel Merk of Merk Investments

I’ve long argued that there may not be any safe asset anymore and that investors may want to take a diversified approach to something as mundane as cash. But what about gold? When I mentioned in a recent interview that not even gold is ‘risk free,’ it raised some eyebrows in the gold community. Let me elaborate.

2015-02-24 Find Hated, You May Find Wealth by William Smead of Smead Capital Management

As we overhear the chatter of major stock market media outlets and read the best writing on publicly-traded companies, we realize how incredibly popular and exciting most of the companies are which dominate investment news. We like to think of it as a love affair between investors and certain “popular” companies. There are numerous contrarians floating around in the media world as well and they caught our attention recently.

2015-02-24 Steady on the Renminbi by Stephen Roach of Project Syndicate

As China's exports sag and the risk of deflation grows, many believe that a reversal in currency policy is the most logical course. But intervening to weaken the exchange rate would be a serious mistake.

2015-02-23 Yes, There Will Be Growth in the Spring by Paul Kasriel of Econtrarian

Looking past the large upward revision to November 2014 nonfarm payrolls, you might have noticed that the U.S. economy has entered, in the words of the Federal Reserve’s version of Chance, the Gardener, Alan Greenspan, a “soft patch”. In recent months, labor conditions have weakened, manufacturing activity has hit a wall, consumer spending has waned and residential real estate demand has sunk.

2015-02-23 Exploring for High Yield Energy Opportunities Amid Ailing Oil Prices by Scott Roberts of Invesco Blog

Energy is a popular topic of conversation in the high yield bond space, with many observers warning of a wave of defaults to come due to the plunge in oil prices. While there will likely be some defaults in the sector, we believe that the market’s pessimism has been overly broad, and we view energy as a potential source of opportunity in 2015. Having a clear understanding of macro drivers in energy, paired with careful security selection, will be key to successfully navigating this volatile space, in our view.

2015-02-23 When Volatility Rises, So Have Active Management Results by Team of The Royce Funds

For many investors, volatility is often synonymous with risk. We as value investors (and risk managers), on the other hand, have always viewed volatility as a crucial component of active stock selection. In our latest Royce Research piece, we explore the relationship between low- and high-volatility environments and the relative performance of active managers versus their respective benchmarks during these periods. This deep dive is especially important in a market that has recently seen more volatility and its largest correction in almost three years.

2015-02-23 Weekly Market Summary by Urban Carmel of The Fat Pitch

SPX has risen two weeks in a row for the first time in 2 1/2 months. For the week, SPX gained 2%, DJIA 1% and RUT 1.5%. The big winner was the previously worrisome laggard, NDX, which gained 3.7%.

2015-02-23 Weighing the Week Ahead: Help for the Economy from Housing? by Jeff Miller of New Arc Investments

The economic calendar includes much more housing data than we normally see in a single week. With Fed Chair Yellen’s Congressional testimony and the GDP revisions also on tap, I expect many observers to be linking these topics. They will ask:

2015-02-23 US Existing Home Sales Drop To 9-Month Low by Team of GaveKal Capital

US existing home sales fell by 4.9% in January to 4.82 million. This is the lowest level since April of last year.

2015-02-23 Global Reflation Should Allow Equities to Push Higher by Robert Doll of Nuveen Asset Management

Financial markets reacted well to the provisional Greek bailout extension, but risks for Europe remain elevated. Wages appear to be starting to climb, which would increase pressure on the Fed to begin rate increases this summer. There is a valid bearish case to be made, but we think the positives for equities outweigh the negatives.

2015-02-23 Why the Bond Market Is Yielding Negative and What Negative Yields Mean for You by Vineer Bhansali, Ben Emons of PIMCO

Negative yields on bonds are no longer unicorns. In Switzerland, Germany, Denmark and several other European countries, government bonds are trading at negative nominal yields. There are four potential reasons that can explain the negative yield conundrum and can also illustrate the trade-offs between different investment strategies.

2015-02-23 Strong Dollar: Good, Not Bad by Brian Wesbury, Robert Stein of First Trust Advisors

In fifteen short days, the bull market will be six years old. And, we’ve never seen such a steep wall of worry. Nouriel Roubini called it a “dead cat bounce.” Many said the recession wouldn’t end until 2010, maybe 2011. Supply-siders said the “Fiscal Cliff” would do us in. Keynesians said “The Spending Sequester” would end the boom.

2015-02-22 Weekly Economic Commentary by Team of Northern Trust

The dramatic retreat in the price of oil and other commodities has muddied the waters for those trying to assess inflation. The world’s central banks, most of which are charged with meeting an inflation target, are among those struggling to gain adequate visibility.

2015-02-22 Deja You? by Robert Isbitts of Sungarden Investment Research

This picture is the story of many investors’ lives, providing they were investing 20-25 years ago. While younger investors may not be able to “feel” the similarities between today’s investor environment and that of the late 1990s buildup to the Nasdaq Composite hitting the 5000 level, those of us who remember it...

2015-02-22 Mind-Blowing: China Consumes More Gold Than the World Produces by Frank Holmes of U.S. Global Investors

The Chinese New Year, which kicks off today, is the largest and most widespread cultural event in mainland China, bringing with it massive consumer spending and gift-giving. During this week alone, an estimated 3.6 billion people in the China region travel by road, rail and air in the largest annual human migration.

2015-02-22 Apple’s Halo Masks US Earnings Conundrum by James Tierney, Jr. of AllianceBernstein

Deep into the US earnings season, the halo from Apple’s shining performance has lit up an otherwise lackluster market. This is no consolation for the rest of the companies in the S&P 500. In this type of market, we believe investors need to be especially discriminating.

2015-02-22 Will Interest Rates Defy Expectations Again? by Russ Koesterich of BlackRock

U.S. interest rates so far this year have not risen above their low levels. While long-term yields are unlikely to spike, we expect U.S. rates (both short- and long-term) to climb over the next 12 months.

2015-02-21 International Equity Commentary: January 2015 by Team of Thomas White International

International equity prices were mostly unchanged during January as gains in both developed and emerging Asian markets were offset by weakness in Canada and select markets in Europe. Investors turned more cautious after the International Monetary Fund and the World Bank lowered their global growth forecasts for the current year, contrary to expectations.

2015-02-21 Global Economic Overview: January 2015 by Team of Thomas White International

Concerns about the sharp fall in capital investments and earnings growth in select sectors resulting from lower oil prices continue to cloud the global economic outlook. While the decline in fuel prices is revitalizing consumer spending across all the major countries, the energy and mining sectors have already started curtailing their capital outlays.

2015-02-21 Emerging Markets Equity Commentary: January 2015 by Team of Thomas White International

Emerging market equity prices outperformed in January on expectations that economic conditions in large Asian countries such as China and India could brighten this year. Fourth quarter GDP growth in China met expectations, helped by higher industrial production and consumer spending.

2015-02-20 Developed Asia Pacific: Economy Trends Update January 2015 by Team of Thomas White International

Japan, the biggest of the developed economies in the region, stands to benefit from cheaper oil as it should boost domestic demand and help some of the country’s key industries reduce costs. Still, the bigger advantage for the country seems to be the re-election of Prime Minister Abe, which has ensured continuity of the fiscal and monetary policies pursued by the government for the last two years.

2015-02-20 Middle East/Africa: Economy Trends Update January 2015 by Team of Thomas White International

This year likely promises mixed prospects for the Middle East and Africa. Among the five economies under our coverage in this region, oil exporters U.A.E. and Qatar are expected to remain under pressure amid the oil price slump. On the other hand, oil-importing South Africa will probably benefit from the downtrend in oil prices as a potential rise in domestic consumption should help the beleaguered economy deal with its various problems.

2015-02-20 High Yield in a Rising Rate Environment: Duration and Yield by Heather Rupp of AdvisorShares

We began February with a yield on the 10-year Treasury of 1.68% and today sit at 2.14%.1All the concerns and talk of maybe even no rate rise this year that we saw in January, have turned to frequent mention of a rate rise beginning in June. So what are bond investors to do? Is this finally the year of rising rates and what impact does that have?

2015-02-20 A Stable Outlook for US Banks: 6 Factors to Watch by Elizabeth Schroeder of Loomis Sayles

Overall, my outlook for US banks remains stable with some hope for a positive turn later in 2015. The game changer will be the Federal Reserve. Should the Fed begin to take steps towards higher rates this year, bank earnings could improve.

2015-02-20 Forward Estimates, Valuations vs. Returns, Told You So by Lance Roberts of Streettalk Live

I got into a debate recently with a gentleman who was adamant that current valuation levels in the market did not suggest trouble ahead. The problem is that his valuation argument was based on the use of forward operating earnings estimates. Let me explain why this is a faulty assumption.

2015-02-20 The Case for Global Investing by Team of Litman Gregory

As U.S. stocks have outperformed developed international and emerging-markets stocks in recent years, we’re starting to hear more people question the benefit of investing outside of the United States. This is an important question, and we acknowledge that owning foreign stocks has been an unsatisfying experience over the past couple of years. Moreover, given some of the current economic and geopolitical forces, it can appear likely to continue this way.

2015-02-20 Skeptical, Yes. Cynical, No. by Edward Talisse of Chelsea Global Advisors

A cynic is someone who is negative ahead of the evidence and will who only, if ever, grudgingly admit to reality. Financial markets have always been afflicted by cynical perma-bears and detractors who simply refuse to acknowledge the power of the market’s relentless upward drift in equity prices over the past two centuries. The data is unassailable.

2015-02-20 Global GDP Tracker by John Canally of LPL Financial

The top 25 global economies make up 90% of global gross domestic product (GDP). Through Friday, February 13, 2015, 13 of these economies (including countries and political unions) have already reported Q4 2014 GDP results, including the four largest economies (U.S., Eurozone, China, and India). As this commentary was being prepared for publication, Japan, the world’s fifth-largest economy, released Q4 GDP results.

2015-02-20 Mardi Gras Market by Brian Andrew of Cleary Gull

Geo-political concerns in the Middle East and Ukraine don’t seem to be able to keep the market down, nor do the tepid economic growth numbers coming from Europe and China. Finally, corporate earnings expectations have been moderated significantly for 2015 and that doesn’t seem to matter to stock prices either. Perhaps the explanation is in the sentiment.

2015-02-20 The Glass Ceiling on Rates by Scott Minerd of Guggenheim Partners

With the debt-to-GDP ratio at historic highs, the Fed doesn’t have much room to maneuver on the federal funds rate.

2015-02-19 Loan Fund Primer by Roger Nusbaum of AdvisorShares

Last week the Riksbank (the Swedish central bank) dropped its benchmark interest rate to -0.10 and as of earlier this week Sweden’s ten year sovereign debt was yielding 0.50%. So Sweden is now the latest country to make headlines about extreme central bank policy to stimulate growth.

2015-02-19 Mistakes Must Service a Purpose by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, examines some investment mistakes he's made in the past. He details five investments, explaining the rationale behind the purchase, what went wrong, and what he learned.

2015-02-19 Hub Group: A Long-Term Investment Thesis by Jason Downey of Diamond Hill Capital Management, Inc.

In September 2013, we outlined our favorable view of the domestic intermodal transportation industry driven by cost advantages, continued market share growth opportunities, and improving pricing power. At that time, we viewed Hub Group, Inc. (HUB) and Pacer International, Inc. as the most attractive investment opportunities within the industry. During the last seventeen months there have been material developments in each of these areas, some positive and some negative.

2015-02-19 Energy Sector Outlook: What We Are Watching by Burt White of LPL Financial

No sector is getting more attention right now than energy. Market participants are attracted to the potential upside after both oil and the energy sector suffered substantial declines in recent months. Many see the sector as cheap, something that is not easy to find these days in the U.S. equity market. We drive by gas stations every day where we see prices have been cut in half, serving as a constant reminder of how cheap oil is. In this commentary, we discuss what we are watching to assess the opportunity in energy.

2015-02-19 2015 Annual Forecast by Clyde Kendzierski of Financial Solutions Group

It’s already February, but for many readers this is the first communication of 2015 so, Happy New Year! It’s been a great 6 weeks so far and we’re looking forward to many more to come. Let’s get into it…

2015-02-19 ??Why Does the Internet of Things Matter? by Vladimir Cara, Iain McNaught, Ji Young Park of PIMCO

The opportunity to gather, process and use data more effectively is potentially worth several trillion dollars across multiple industries over the next decade. We expect most industries to adopt some form of this technology, with network effects and competitive dynamics leading to almost ubiquitous adoption beyond the current decade.

2015-02-19 Great Expectations for Small-Cap Active Management by Chuck Royce, Chris Clark, and Francis Gannon of The Royce Funds

Widening credit spreads, increasing volatility, and decreasing stock correlation should allow stock pickers the chance to emerge as performance leaders. We continue to see good times ahead for active managers who focus on business fundamentals.

2015-02-19 February 2015 Economic Update by John Richards of Bronfman E.L. Rothschild

Consumers in the U.S. are showing their optimism by pushing a key consumer sentiment indicator to its highest level in over a decade. Despite a drop-off in Q4 GDP to a 2.6% annualized growth rate and three consecutive months of slowing manufacturing expansion, the U.S. economy still seems to be on strong footing.

2015-02-19 Liquid Endowment Portfolios by (Article)

In this video for The PMC Spotlight, Michael Featherman, Director of Portfolio Strategies, discusses how the "endowment" portfolio framework addresses the headwinds recently faced by conventional sources of diversification.

2015-02-19 Brighter Days Ahead for the Global Economy? by Team of Thomas White International

After seven years of uneven growth trends following the 2008 financial crisis, we believe the global economy is likely to see a moderate acceleration in 2015. While several risks remain, we are reasonably confident that there are now enough growth drivers in place to help most major economies advance.

2015-02-19 Global Economic Overview: December 2014 by Team of Thomas White International

After the initial optimism about lower energy prices supporting a healthier global economic growth outlook, investors and analysts have become more apprehensive as the price decline has been remarkably steep.

2015-02-19 International Equity Commentary: December 2014 by Team of Thomas White International

International equity prices corrected during the month as fears about the negative economic and political fallout of the steep drop in oil prices on energy producing countries unnerved investors. Brent crude oil prices fell to a six-year low during the month, a decline of more than 50 percent in four months.

2015-02-19 Emerging Markets Equity Commentary: December 2014 by Team of Thomas White International

Emerging market equity prices corrected during the month on concerns that the steep fall in crude oil prices could hurt the outlook for select countries.

2015-02-19 Emerging Europe: Economy Trends Update -- January 2015 by Team of Thomas White International

Emerging European economies witnessed renewed volatility as the New Year unfolded. Russia, the largest of the economies covered in this review, appeared particularly vulnerable as President Putin has not yielded his stance on Ukraine despite the damage inflicted to his country by the Western sanctions and plunging oil prices.

2015-02-19 Global dividends reach new record in 2014 by Alex Crooke (Article)

Alex Crooke reviews the latest Henderson Global Dividend Study (HGDS) findings where he notes global dividends reached a new record in 2014, with the United States leading the charge. Global dividends soared 10.5% to $1.167 trillion in 2014, a new record. Underlying growth was still robust at 8.8%, even with generous special dividends, exchange rate movements and other factors stripped out. The HGDS value reached 159.9 at the end of 2014, meaning that dividends have grown almost 60% in just five years.

2015-02-18 On My Radar: Schumpeter’s Creative Destruction by Steve Blumenthal of CMG Capital Management Group

This week let’s take a look at debt around the globe. I share a great piece from McKinsey & Company that shows just how much more debt, county by country, has been piled on since the 2007 debt induced financial crisis. Evidence is apparent in the commodity market and I also share a few ideas how you may risk manage those allocations.

2015-02-18 The Most Successful Public Company In The World by Gary Halbert of Halbert Wealth Management

Today we focus on the most successful and profitable company in the entire world. It just happens to be an American company, but many of us have never heard of it. If you had invested $1 in this company in 1968, your investment would have soared to $6,638 at the end of last year. I think you’ll be surprised to see which company this is.

2015-02-18 Student Debt: Grading the Threat by Milton Ezrati of Lord Abbett

Could widespread defaults on the $1.2 trillion in U.S. student debt cripple the economy? Not likely.

2015-02-18 A World of Uncertainty by Jerry Wagner of Flexible Plan Investments

After spending over 32 years working in and around the financial services industry, I have come to a realization about one of the most important attributes for investors.

2015-02-18 Global Carry Game Over? by Alexander Giryavets of Dynamika Capital L.L.C.

The world has changed on the 2nd of February after US Personal Income and Outlays report or maybe more importantly ISM Manufacturing Index report got released. The Global Carry trade and Dollar trade got broken and have been broken since. Is it a passing correction or the time is up and the game is over?

2015-02-18 Winter of Discontent or Winding the Spring? by Scott Brown of Raymond James

Retail sales figures disappointed in December and January. The Bloomberg/University of Michigan Consumer Sentiment Index fell back in mid-February. This news has cast some doubt about whether the drop in gasoline prices will propel consumer spending growth in the near term. However, economic data are notoriously unreliable in the winter months. The spring economic data reports should provide a better picture of the underlying strength in jobs, consumer spending, and housing.

2015-02-18 Can Trees Really Grow to the Sky? by Jeffrey Saut of Raymond James

I stopped my rental car in the middle of a cluster of giant sequoia trees while driving to one of my speaking engagements in northern California last week. I have always been overwhelmed with these beautiful “beasts” and last week was no exception. As I lay supine at the base of the behemoth the visual fallacy actually made it look like this monster was indeed growing to the sky. The surreal sensation brought to mind the old stock market axiom, “Trees don’t grow to the sky!”

2015-02-18 Africa Could Mine Its Way to Prosperity if It Addressed Instability by Frank Holmes of U.S. Global Investors

Last week I attended the Investing in African Mining Indaba in Cape Town, South Africa, as both a presenter and a student seeking opportunities. One of the highlights of the conference was former Prime Minister Tony Blair’s keynote address, during which he offered some crucial advice to African governments: To attract and foster a robust mining sector, a commitment to fiscal stability must be made.

2015-02-18 Demystifying - and Defeating - Deflation by Donald Taylor of Franklin Templeton Investments

Consumers who have been raised to fear inflation may find it hard to understand why falling prices could ever be negative. Like many things in life, however, too much of a seemingly good thing sometimes can spell trouble. Donald Taylor, president and chief investment officer, Franklin Equity Group®, US Value, explains why, much like a football or basketball, an economy grappling with deflation is not in its optimal condition.

2015-02-18 Euro-Area Growth: Reasons to be Cheerful by Darren Williams of AllianceBernstein

There are good reasons to be concerned about the medium-term outlook for euro-area growth. But that doesn’t mean the business cycle is dead. We think the conditions for a cyclical rebound in regional growth are currently better than they’ve been at any time since the global financial crisis.

2015-02-17 Why We’re Cautious on Credit by Rob Waldner of Invesco Blog

In the current environment of rising global volatility and potentially weak US corporate earnings growth, Invesco Fixed Income is cautious on US and European credit. While European investment grade credit may be supported by the European Central Bank’s (ECB) program of quantitative easing (QE), we believe US investment grade would likely underperform US Treasuries in the current environment, although we would expect it to perform better than riskier assets.

2015-02-17 Gary Shilling - Why You Should Own Bonds by Robert Huebscher (Article)

If you followed Gary Shilling's advice for the last 30 years, you would be very wealthy. Since 1981, Shilling has consistently advocated owning long-dated Treasury securities. In a talk last week, he reiterated that advice as one piece of his three-part asset-allocation strategy for the coming year.

2015-02-17 Search for Strength: EM Downturn Puts Focus on Fundamentals by Sponsored Content by Invesco (Article)

  • Corporate earnings deterioration and a decline in return on capital have held back emerging market performance.
  • Reversing weak performance depends on a return to stronger corporate earnings.
  • Downside risks could lead to disappointing earnings growth, but positive fundamentals are unfolding.

2015-02-17 Robo-Advisors Are Not New But They Foretell the Future of Financial Advice by Joe Tomlinson (Article)

So-called robo-advisors have been heralded as the next generation of technology that will transform the financial advice industry. Underneath the considerable debate that has emerged over their potential impact, an obvious fact has been overlooked: Much of what they offer is distinctively "old school."

2015-02-17 The Devastation Awaiting Residential Mortgage-Backed Securities by Keith Jurow (Article)

Real estate investment euphoria is widespread. An asset class for which Wall Street has provided little useful information - residential mortgage-backed securities (RMBS) - is especially vulnerable if this euphoria is misplaced.

2015-02-17 The Question that Quadrupled Response Rates by Dan Richards (Article)

Last week, my article described how an advisor uses case studies on tax saving strategies to get in front of prospects. Today, I will discuss the tactic that quadrupled participation in a Red Cross blood drive, and how this technique could increase your success when talking to existing and prospective clients.

2015-02-17 How to Open a Closed Mind by Daniel Solin (Article)

Every advisor knows that sinking feeling that arises when a prospect raises serious objections and a meeting heads downhill. Here's how you can open what appears to be a closed mind.

2015-02-17 Steering Clear of Bad Blood in the Office by Beverly Flaxington (Article)

Two of our advisors openly dislike each other. Is there a graceful way to steer clear of this whole situation?

2015-02-17 Repression, Compression, Expression by Rick Chan of PIMCO

Cumulative financial repression has led to compressed and recently highly correlated yields in most developed countries, while markets have been volatile as investors react and adjust to the new environment. Recent short-term spikes in volatility belie likely damped volatility at these low rates over time, suggesting a potentially attractive opportunity to sell longer-term volatility at current premiums.

2015-02-17 Is Modern Portfolio Theory Dead? by Vern Sumnicht of iSectors

A response to an article titled, “Modern Portfolio Theory is Dead.” The point is to simply ask which of the principles of Modern Portfolio Theory are no longer true. I think it’s more than obvious that these sound principles of investing that have been with us for more than 50 years will be here 50 years from now.

2015-02-17 Wide Disparity in 2014 Stock Returns Shows the Importance of Diversification by Team of Bronfman E.L. Rothschild

With another calendar year in the books, investors can look back to 2014 and see the vast disparity between asset classes, with the U.S. markets leading the way for a second consecutive year. Why not just invest in the S&P 500 Index? The answer is that we don’t know which asset class will be the top performer from year to year. Looking back on the past 15 years, the U.S. has only led three times, with all three coming since 2011, hence the reason for the initial question.

2015-02-17 Tracking the Market with Social Media by Blair Jensen of Trade Followers

As the S&P 500 Index (SPX) made a new closing high this week momentum and sentiment from both Twitter and StockTwits confirmed the move by making a print above their prior peaks. 7 Day momentum from Twitter also has a higher low which indicates a new uptrend is most likely under way.

2015-02-17 European Forecast: Clouds Lifting by Matt Lloyd of Advisors Asset Management

We understand the general public’s concern with regard to Europe. Just when you get your hands around a cease fire in Ukraine, the “Greexit” hits the newsstands with hardline headlines. If this Greek drama ever ends - which is unlikely as we noted two weeks ago detailing Greece’s restructuring –-rescheduling or outright default on debt occurs over 45% of the time since 1800, one still has to deal with the constant threat of a deepening recession.

2015-02-17 Extreme Overvaluation and the Inventory Problem by John Hussman of Hussman Funds

Current equity markets are no place for long-term investors, and even a resumption of risk-seeking investor preferences would demand a considerable safety net.

2015-02-17 Shut off the Noise, Hear the Risks by Gibson Smith of Janus Capital Group

Janus Fixed Income CIO Gibson Smith believes volatility in the fixed income market may represent a greater risk than a sustained increase in rates.

2015-02-17 Keynesian Contrarianism: Where is the Minority Today? by William Smead of Smead Capital Management

To get a good feel for where the largest pools of money are invested around the world and to identify the minority, we draw from the NACUBO-Commonfund Study of Endowments in North America. This year’s survey included $516 billion in investable assets. The results for the fiscal year ended June 30th of 2014 are listed below. Pay particular attention to the largest endowments, because we believe they represent the asset allocation of the largest worldwide institutions.

2015-02-17 Why Equities Should Be in Your Portfolio by (Article)

What kind of total return could the market produce this year? Portfolio Manager Charlie Dreifus believes owning a portfolio of high-quality companies looks more attractive than the alternatives.

2015-02-17 Learn About CEFs by (Article)

Learning more about closed-end funds may help financial advisors be even more successful with clients, says Anne Kritzmire of Nuveen Investments and CEFA.

2015-02-17 EM Sector Featuring Ryan Paylor by (Article)

The emerging market sector, especially Latin America, presents potential opportunity to CEF investors, says Ryan Paylor, of Thomas J. Herzfeld Advisors.

2015-02-17 High Yield Bond CEFs Featuring John Cole Scott by (Article)

High yield bond closed-end funds may be “overdone” by investors, says John Cole Scott of CEF Advisors.

2015-02-17 What Does the Current Low Interest Rate Environment Mean for Agency MBS? by Mike Cudzil, Daniel Hyman of PIMCO

After the agency MBS market in 2014 was dominated by low volatility, limited prepayment risk and strong performance, the strong rally in U.S. Treasuries in January resulted in just the opposite. With the Fed ending net purchases of MBS in October 2014, it seems unlikely for the private investment community to take the Fed’s place in the MBS market at this level of interest rates and spreads. PIMCO expects the environment for MBS in 2015 to be quite the opposite of 2014, resulting in higher volatility, cheaper valuations and more attractive excess return opportunities for the active manager.

2015-02-17 Investor Sentiment Is Strengthening by Robert Doll of Nuveen Asset Management

U.S. equities finished higher for a second straight week, with the S&P 500 Index gaining 2.1% as it ended the week at a record high.1 Investors largely shrugged off disappointing retail sales figures and chose to focus on the positives.

2015-02-17 QE and Currency Wars: A Theory With No Evidence by Brian Wesbury, Robert Stein of First Trust Advisors

Some analysts think that central bank policy (specifically, quantitative easing) is the only thing that matters. They overlook innovation, investment, and just plain old hard work and argue that stock prices, interest rates and economic performance are driven by central bank stimulus. These analysts say the world has returned to a Depression-era game of competitive devaluation (some call it “currency wars”).

2015-02-17 U.S. Dollar Strength Continues to Impact U.S. Multinationals by Jeremy Schwartz of WisdomTree

S&P 500 Index has traded inversely to the currency moves over recent years, and it has become increasingly negatively negatively correlated. One reason, we believe, is that a growing share of revenue and profits for U.S. corporations comes from overseas—and that share seems likely to increase with the globalization of the economy.

2015-02-17 Is That Leveraged ETF Worth It? Comparing SSO and VOO by Team of GaveKal Capital

As ETFs control a larger number of assets under management, it is no surprise that the options available to investors are getting ever more exotic. One of the early examples (and thus we actually have history available) of exotic ETFs are leveraged ETFs. Leveraged ETFs attempt to to mimic the daily change in an index, in today's case the S&P 500, by a defined multiple (i.e. 2x, 3x, etc). Today, we will look at one of the more highly used leveraged ETF: Proshares Ultra S&P 500 (ticker: SSO).

2015-02-15 Self-Sustaining US Economy…So What Now? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The US economy appears to be in a self-sustaining phase of the expansion, which could mean more volatility as the Fed embarks on a tightening cycle. We remain confident the secular bull market is intact, but volatility has risen and we suggest investors who are over-exposed to US equities consider global diversification, with a preference for emerging markets. Europe appears to be stealthily improving, but Greece remains a flash point and Eurozone equity markets may have gotten ahead of themselves a bit.

2015-02-15 Weighing the Week Ahead: Will Energy Stocks Support the Market Breakout? by Jeff Miller of New Arc Investments

I do not know whether we have reached a bottom in energy prices, but I have identified two important themes.

2015-02-15 Mamas, Don’t Let Your Babies Grow Up to Be Pension Fund Managers by John Mauldin of Mauldin Economics

We do not have to look to Greece to find massively underfunded obligations. Here in the US we can find hundreds of examples, willingly created by politicians and businessmen who proclaim they are working for the public good. We call them pension funds, but they’re just another form of unfunded debt. A sovereign bond is a promise to pay a certain amount of money over time.

2015-02-14 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

So there are a number of positives that suggest indices will continue broadly higher. But there a few other considerations that are potentially negative.

2015-02-14 The Daily X-Change - 3 Things - Uncomfortable Facts, 25-54 Employment, Houston RE by Lance Roberts of Streettalk Live

While the media and mainstream analysts discount the negative economic impact of falling energy costs, I have personally witnessed it in the mid-80's, the late 90's and just prior to 2008. In all cases, the negative outcomes were far worse than predicted which left economists scratching their heads as to what went wrong with their models. Of course, considering the BLS only saw a loss of 1900 manufacturing (oil and gas) jobs in January when there were 26,000 layoffs may explain part of the problem.

2015-02-14 Alternate Current: The Power of Diverse Return Sources by Christine Johnson of AllianceBernstein

After a long period of calm, global markets now face tumbling oil prices, geopolitical risks and monetary policy changes. Investors looking for new ways to diversify in this uncertain environment should take a long look at investments that don’t take their cues from stock or bond market movements.

2015-02-14 When Patience Disappears by Scott Minerd of Guggenheim Partners

Advance notice of the timing of a rate hike by the Federal Reserve may hinge on the removal of just one word, warns St. Louis Fed President Bullard.

2015-02-14 Bonding with Diversification by Rick Rieder of BlackRock

With the fixed income landscape poised for a makeover, Rick Rieder discusses the importance of diversification.

2015-02-14 Anatomy of a Down Market by Rob Isbitts of Sungarden Investment Research

As with all professional investors, we have an opinion about where the market is going, over the next few months and years, and even longer. Such forecasts do not contribute meaningfully to the investment decisions we make at Sungarden. Rather, our investment committee tries to focus on what is right in front of us. Instead of investing for a specific outcome, we gauge the possibilities, evaluate the tradeoff between reward and risk, and plan for anything.

2015-02-14 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.0, down from 130.8 the previous week. The WLI annualized growth indicator (WLIg) is at -4.3, down slightly from the previous week's -4.0, but up from the interim low of -5.0 in mid-January.

2015-02-13 DC Managed Accounts: Shining a Spotlight on Investment Advice by Steve Ferber, Michael Esselman of PIMCO

?Nearly one in three defined contribution (DC) plans offers managed account and automated advice services that attempt to enhance investment outcomes with personalized advice. As the Government Accountability Office has reported, however, plan sponsors often have had limited or insufficient information to evaluate and monitor automated advice engines, despite having fiduciary responsibility over advice provided to participants.

2015-02-13 47% of the MSCI World Index Is In A Correction (At Least) by Team of GaveKal Capital

Regular readers know we like to slice the market internal data in a many different ways because a lot of the time the cap-weighted indices aren't a proper representation of what is going on with the majority of stocks. With this in mind, one of the ways we like to measure what is going on underneath the surface is to take a percentage of stocks that are trading at levels less than 10% off its 200-day high, 10-20% off its 200-day high, 20-30% off its 200-day high and greater than 30% off its 200-day high.

2015-02-13 Global Airline Stocks Soaring, and Not Just Because of Low Oil Prices by Frank Holmes of U.S. Global Investors

The airline industry is notoriously competitive. There’s even an old joke: If you want to make a million dollars in the airline business, you need to start with two million.

2015-02-13 One Cheer for India: Hip, Hip but no Hooray? by Sudarshan Murthy of Matthews Asia

There has been a sense of optimism lately over India’s place in the world, and its markets demonstrated some enthusiasm over the seemingly good chemistry between U.S. President Barack Obama and Prime Minister Narendra Modi. But should investors beware of chasing price momentum?

2015-02-13 January Jobs Data - Good, but Slack Remains by Scott Brown of Raymond James

Contrary to what you may have heard, the U.S. economy did not add 257,000 jobs in January. That’s the seasonally adjusted figure. We actually lost 2.755 million jobs, which was a smaller decline than the year before (-2.811 million).

2015-02-13 From Russia with Love? by Jeffrey Saut of Raymond James

The big news late last week was German Chancellor Angela Merkel’s and French President Francois Hollande’s emergency trip to Russia for peace talks with President Putin. Obviously, the situation in the Ukraine is heating up again or such Herculean efforts would not be undertaken.

2015-02-13 Three Surveys Show US Consumers Feeling Friskier by Brian Horrigan of Loomis Sayles

US consumers are feeling friskier according to recent data. Consumers appear to have, at long last, shaken off the “blues” they suffered on account of the severe recession of 2007-2009 and the subsequent slow recovery. I don’t think we can attribute the improved consumer outlook to any one factor, but rather from a combination of factors: over a year of solid payroll growth, improving wage gains, a plunge in gasoline prices, rising stock and house prices, and low interest rates.

2015-02-13 The dshort Economic Calendar, Miami Style by Doug Short (Article)

Note from dshort: I'm in semi-vacation mode in southern Florida for the next few days. My routine updates on economic indicators will be posted on a somewhat delayed basis.

Today we spent Friday on a touring the Fairchild Topical Gardens a few miles south of Miami, 83 acres of amazing rare tropical plants including palms, cycads, flowering trees and vines. The gardens are all the more spectacular with the current exhibition of works by American artist Dale Chihuly.

2015-02-12 President Obama's tax proposal: What equity investors need to know by Michael Allison of Eaton Vance

In this insight, Michael examines the potential for higher tax rates on long-term gains and dividends and makes the case for taking a tax-managed approach to equity investing.

2015-02-12 Europe: The Road to Recovery? by John Canally of LPL Financial

Although it is too soon to gauge the effectiveness of QE in the Eurozone, key readings and data are beginning to show improvement, and consensus expectations are for continued growth in 2015. However, Market participants looking for an immediate and sustained response by the Eurozone economy to QE may be disappointed. The renewed political and fiscal uncertainty in Greece will be watched closely by market participants in the coming weeks and months.

2015-02-12 Rising Interest Rates & Long Term Stock Returns by Lance Roberts of Streettalk Live

With the Federal Reserve now indicating that they are "really serious" about raising interest rates, there have come numerous articles and analysis discussing the impact on asset prices.

2015-02-12 On My Radar: Go Ahead Angela, Make My Day by Steve Blumenthal of CMG Capital Management Group

I spend a great deal of time writing about valuations, probable future returns (near record lows today), portfolio construction and risk management. Reflecting on four days of non-stop sessions, media interviews and meetings at the Inside ETFs Annual Conference this past week, I thought I’d share several key takeaways with you.

2015-02-12 Is Skill Dead? by Neil Constable, Matt Kadnar of GMO

As investment boards and committees gather to discuss performance for 2014, eyebrows will most certainly be raised as people review the performance of many of their equity managers. Depending on which database they are looking at, between 80% and 90% of active U.S. equity managers will have underperformed their benchmark this year, making it one of the worst years for active management in the recent past.

2015-02-12 Sector Insights: Technology by Steve Jue of Rainier Investment Management

With cloud computing, mobile Internet, the “Internet of Things” and next-generation security, recent trends in technology are driving innovation and are creating attractive opportunities for investors.

2015-02-12 Scott Mather Discusses PIMCO’s Total Return Strategy by Scott Mather of PIMCO

Bonds have continued to rally so far this year, even as the Federal Reserve contemplates raising interest rates. In the following interview, Scott Mather, CIO U.S. Core Strategies, discusses recent developments in the bond markets, the outlook for the year ahead and the investment implications for PIMCO’s Total Return Strategy. Mather co-manages the strategy with Mark Kiesel, CIO Global Credit, and Mihir Worah, CIO Real Return and Asset Allocation.

2015-02-12 Alpha Generation for Active Managers by Heather Rupp of AdvisorShares

As we discussed in our recent blog (see “The Opportunity in Volatility”), we are currently seeing a lot of attractive opportunities in the high yield market—discounts and yields that we haven’t seen in some time. And while we have seen the yields in the high yield indexes and the products that track them increase over the last six months, they don’t really seem to reflect the true opportunity we are seeing in the market.

2015-02-11 Will China’s Year of the Goat Bring Out the Market Bulls? by Eddie Chow of Franklin Templeton Investments

According to the Chinese calendar, 2015 is the Year of the Goat (or sheep), creatures that are typically peaceful in nature but can also be stubborn, while exhibiting herd-like behavior. I’ve invited my colleague Eddie Chow, senior executive vice president and managing director, Templeton Emerging Markets Group, to share his perspective on some key themes our team is watching in 2015 for China, and whether we think market bulls, bears or goats can be friends this year.

2015-02-11 Earnings Season Highlights and Lowlights by Burt White of LPL Financial

In this commentary we look at some of the highlights and lowlights of fourth quarter earnings season. Despite the massive drag from the energy sector and the negative impact of a strong U.S. dollar, fourth quarter 2014 earnings are on track to exceed prior estimates. We maintain our 5?-?10% earnings growth forecast for 2015* and believe cheaper energy costs will help us get there.

2015-02-11 Deflation Is Spreading In Europe - Is America Next? by Gary Halbert of Halbert Wealth Management

US consumer prices fell in December by the largest amount in six years, reflecting another big monthly decline in gas prices and providing further evidence of falling inflation pressures. The Labor Department said Friday that its Consumer Price Index dropped 0.4% in December, the largest one-month drop since December 2008. It was also the second straight monthly decline in prices with both months reflecting big decreases in gasoline prices.

2015-02-11 The Bond Market in 2015: Mind the (Price) Gaps by Kathleen Gaffney of Eaton Vance

In this insight, Kathleen reviews her outlook for the bond market and explains how a multi sector bond approach could turn rate hike volatility into opportunity for patient investors.

2015-02-11 Repression Investing: Got Gold? by Axel Merk of Merk Investments

Gone are the ZIRP days – the ‘Zero Interest Rate Policy’ is being replaced by negative interest rates in various countries. ZIRP is a form of financial repression, where savers earn less than the inflation rate to discourage saving. Pundits suggest the U.S. has chosen a different course, as ‘liftoff’ may soon take U.S. rates higher. We’ll try to separate reality from fiction, discussing investment implications for the U.S. dollar and gold.

2015-02-11 Did the 2014 Volatility Create a 2015 Opportunity? The Outlook for High Yield by Chad Gunther of Ivy Investment Management Company

The tumbling oil market put junk bond prices On a slippery slope in late 2014. Total returns on high-yield bond indexes tracked by Barclays fell into negative territory in mid-December for the first time since 2011, as investor fear about downside risk associated with energy-related junk bonds spilled over into the rest of the high-yield market. While the slide in high-yield valuations may have disappointed some investors, Ivy High Income Portfolio Manager Chad Gunther believes it created some potentially attractive opportunities in the high-yield credit market. Below he shares his views.

2015-02-11 Investing Lessons from the Super Bowl by Jerry Wagner of Flexible Plan Investments

Super Bowl losing teams are usually quickly forgotten—consigned, as the expression goes, to history’s dustbin. In fact, some NFL historians and coaches have said that the losers of the semi-finals (conference title game) have often received more long-term recognition than the Super Bowl losers, for the simple reason they may have played the Super Bowl winner much tougher in the earlier round.

2015-02-11 Positive Economic Surprises in Europe, Negative in the U.S. by Team of GaveKal Capital

The Citi Economic Surprise index is a quick way to get a high-level look at the condition of economic data around the world. Calculated as a diffusion index, values generally range between 100 and -100 for the overall index, which is currently right in the middle of that range.

2015-02-11 China Just Crossed a Landmark Threshold by Frank Holmes of U.S. Global Investors

Back in July 2013, the think tank Heritage Foundation predicted that China’s outbound investment “could very well exceed $80 billion [by the end of the year] and is on course to breach $100 billion by about 2016.”

2015-02-11 The Sectors Now on Shaky Ground by Russ Koesterich of BlackRock

Bond yields surged last week, putting some dividend-rich stocks (utilities, REITs) in a very vulnerable position. Could this be the end of their rally?

2015-02-11 Don’t Count High Yield Out in 2015 by Gershon Distenfeld of AllianceBernstein

Fears about higher US interest rates, rising defaults and a multi-month decline in the price of oil have injected a dose of high anxiety into the high-yield market. But we still think investors will be better off this year if they stand their ground and stay invested.

2015-02-10 Harold Evensky - Nine Key Communication Points by Robert Huebscher (Article)

Advisors should put their mouths where their money is, according to Harold Evensky. Educating and preparing clients for what advisors will ultimately deliver must be a core principle of every practice. In a recent presentation, Evensky described nine key ways that advisors should interact with clients, the media and their peers.

2015-02-10 An In-Depth Look at the Tweedy Browne Value Fund by Larry Swedroe (Article)

Tweedy Browne has long been one of the most respected and iconic names in the mutual fund industry. But, over the long term, has the firm's flagship fund outperformed a passive benchmark?

2015-02-10 Mohamed El-Erian: Beware the Bubble in Liquidity by Robert Huebscher (Article)

In 2000, it was technology stocks. In 2007, it was real-estate prices. Among today's overvalued asset classes, which one will crash most spectacularly when the bubble bursts? Mohamed El-Erian, the chief economic advisor at Allianz, thinks he knows the answer.

2015-02-10 Curiosity-free Research by Michael Edesess (Article)

You come across an article that won the Financial Analyst Journal's award for best paper of 2013. You tracked it down from something you saw recently in The Economist. It is written by two Yale professors and two researchers at investment management firms - a good mix of academics and practitioners. Is it safe to assume that it provides reliable information about how to invest one's savings?

2015-02-10 Getting Prospects to Meet by Dan Richards (Article)

While prospective clients are pressed for time, the core issue is that many advisors fail to convey a big enough payoff when asking for the time to meet. After all, everyone can find 45 minutes if they really want to. So, how can you create urgency around your request?

2015-02-10 How to Generate More "Warm" Referrals by Daniel Solin (Article)

For many advisors, the issue isn't converting prospects into clients, but rather generating more leads. A recent article offered some helpful suggestions on how even small advisory firms can generate a flood of new prospects.

2015-02-10 Freeing Up Time for Growth Activities by Beverly Flaxington (Article)

We devote most of our time to client communications and portfolio changes. These are the activities that fuel business, so I am reluctant to spend less time doing them. My preference would be to provide the same level of investment and client service but to find time to grow as well. Do you any tips for me?

2015-02-10 Why Building Trust is the Top Priority in 2015 by Robin Powell (Article)

I have long advocated using high-quality, engaging content to build trust and attract and retain more clients. Your content reflects - or should reflect - you and your values and it has to take center stage in your firm's marketing strategy.

2015-02-10 Questions Remain After Blowout Employment Report by Lance Roberts of Streettalk Live

I like to think of myself as a pretty simple guy. I don't like complexity or complications, but most importantly I like things to make sense. The latest employment report, which showed a surge in employment in recent months, left me with more questions than answers.

2015-02-10 Weighing the Week Ahead: Time for “Risk On?” by Jeff Miller of New Arc Investments

With a modest schedule of data releases, we can expect more analysis of last week’s news. Trading in several markets changed course rather abruptly. With traders poised to spot any change in trend, the question will be whether this shift is for real.

2015-02-10 Greece Dependency Has Created Dangerous Illusions by John Browne of Euro Pacific Capital

Once again the crisis in Greece is threatening the unity of the entire euro zone. Many analysts are asking what must be done to restore viability to the Union's weakest link. Lost in this discussion is that modern Greece, formed in 1830, has never really been required to stand on its own. Generations of support from abroad, typically given for strategic reasons, has created a false sense of prosperity in the country and has prevented the Greeks from accepting the realities of their current situation.

2015-02-10 Greek Games by Bill O'Grady of Confluence Investment Management

After the Syriza party won 149 of the 300 seats in the Jan. 24th Greek elections, European markets have been roiled by worries over another crisis developing. In this report, we use game theory to describe the situation between Greece and the EU/Germany/ECB. This method shows how misunderstandings can develop and how catastrophic mistakes are made. Using this structure, we will outline the positions and perceptions of both sides and describe how this situation could lead to another crisis. As always, we will finish with market ramifications.

2015-02-10 Currencies: What to Watch for after the Swiss Surprise by Milton Ezrati of Lord Abbett

Switzerland’s decision to scrap the franc-euro peg has grabbed the headlines, but the bigger story remains the continued dominance of the U.S. dollar.

2015-02-10 Recession Probability Models - February 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession.

2015-02-10 Evensky & Katz Newsletter by Harold Evensky of Evensky & Katz

Harold Evensky presents his quarterly newsletter.

2015-02-10 Riding An Aging Bull (Market) by Rick Vollaro of Pinnacle Advisory Group

The year has begun in roller coaster fashion, and our team has been busy reading and digesting the many 2015 outlooks that come across our desks. But reading is the easy part, and now it’s our turn to distill the many facets of our process into a workable thesis that allows us to generate attractive risk-adjusted returns in this maturing market cycle.

2015-02-10 An Accidental Currency War? by Mohamed El-Erian of Project Syndicate

Six and a half years after the global financial crisis, central banks in emerging and developed economies alike are continuing to pursue unprecedentedly activist – and unpredictable – monetary policy. How much road remains in this extraordinary journey?

2015-02-09 Surprises in 2014 and Expectations for 2015 by (Article)

Portfolio Manager and Principal Charlie Dreifus talks about the global slowdown in 2014 and its effects on interest rates in the U.S. and abroad, how data points for the U.S. economy and quantitative easing in the eurozone will play a big role in shaping the investment landscape in 2015, and how - with interest rates so low - wage inflation could have a positive impact on the markets.

2015-02-09 Outlook and Positioning by Alex Crooke (Article)

Alex Crooke, Head of Global Equity Income, provides a review of the Henderson Global Equity Income Fund's (HFQAX) recent performance and current positioning as well as providing an update on recent events in Europe. Alex notes that the action of the ECB (European Central Bank) starting a quantitative easing (QE) program as the most significant factor driving markets over the next 6 months. While he believes the program will be a slow modest start with monthly purchases around 60trillion Euros, it should gain traction over the next year or two.

2015-02-09 Revisions to the Nonfarm Payroll Jobs Report by Doug Short (Article)

In my latest Employment Update for January, I pointed out that the Bureau of Labor Statistics revised the December month-over-month change for Nonfarm Payroll Employment upward from 252K to 329K and November from 353K to 423K, a total of 147K to the upside. However, the BLS's initial estimate for this metric should be taken with the proverbial grain of salt. In this chart, I plot the change since the turn of the century from the first to third estimate for each month through November 2014, the most recent month for which we have three estimates.

2015-02-09 Bonds or Jeter? by Richard Bernstein of Richard Bernstein Advisors

In baseball, batters choose to either swing for the fences in hopes of a home run or go for more consistent base hits. These same principles are highly relevant to the current market environment and long-term investment success. So, see if you really want home run hitters in your portfolio?

2015-02-09 The International Ramifications of ECB QE by Andrew Bosomworth of PIMCO

By engaging in quantitative easing, the European Central Bank is pursuing its inflation mandate with a vengeance. Overall, we think the combination of quantitative easing, investment and lower oil prices will help eurozone growth reach approximately 1.3% in 2015. Global central bank balance sheets continue to expand: Although the Federal Reserve stopped purchasing assets in 2014, the Bank of Japan and now the ECB have stepped up buying bonds where the Fed left off.

2015-02-09 Leaning in to Headwinds and Headlines by Matt Dennis of Invesco Blog

There’s been no shortage of headlines focused on European volatility lately, and the current consensus is that Europe is the last place investors want to put money. The risk for investors in my mind, however, is that they follow the headlines and exit Europe now instead of leaning into the headwinds of consensus and building positions.

2015-02-09 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Traders on Twitter and StockTwits are still waiting for a break of the current range before making any commitment to the market. As the S&P 500 Index (SPX) has oscillated in a range between 1990 and 2065 the Trade Followers momentum and sentiment indicators have continued to fall. The StockTwits community is getting more bearish as the range continues. The new up trend line from StockTwits has been broken to the downside which indicates there was no enthusiasm for last week’s rally.

2015-02-09 All the Children Are Above Average by Harley Bassman of PIMCO

Many investment strategies are centered upon discovering a long-term (average) valuation framework to help in asset allocation and security selection. The term surface of various risk parameters often moves in such a manner that the discounted forward value will point toward this long-term average. If a secular shift has taken place - if all the children are above average, so to speak - then maybe the “average” has changed.

2015-02-09 Questions Remain After Blowout Employment Report by Lance Roberts of Streettalk Live

I like to think of myself as a pretty simple guy. I don't like complexity or complications, but most importantly I like things to make sense. The latest employment report, which showed a surge in employment in recent months, left me with more questions than answers.

2015-02-08 The Eurozone: Collateral Damage by John Mauldin of Mauldin Economics

Now we're watching another Greek drama that could have significant unintended consequences – far beyond anything the market has priced in today. Then again, maybe not. Maybe the market is right this time. When we enter unknown territory, who knows what we will find? Fertile valleys and treasure, or deserts and devastation? Today we look at the situation in Europe and ponder what we don't know. Greece provides a wonderful learning opportunity.

2015-02-08 Expect a Decade of 1.7% Portfolio Returns from a Conventional Asset Mix by John Hussman of Hussman Funds

The problem for investors here is that risk premiums are compressed in equities at a time when bonds offer no way out. When risk premiums are compressed across the board, conventional asset allocations are very much like trying to squeeze water from a stone. We project a 10-year nominal annual portfolio total return averaging only about 1.7% annually for anything close to a standard portfolio mix of equities, bonds and cash, regardless of how much diversification one has within each of those asset classes.

2015-02-07 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

SPX has now fallen 4 of the last 5 weeks, including this past one. For the week, SPX and DJIA each lost nearly 3% and NDX lost 0.8%.The indices and most of the sectors have fallen under their key moving averages. Many of these now have a declining slope. Over the past month, price has made lower highs. All of this suggests that the trend is down. Moreover, bullish set ups are failing, a warning that price has not reached an oversold level. Despite the sell off, breadth and longer term measurements of sentiment have not washed out to an extent that would suggest a low is in place.

2015-02-07 The Power of Lower Oil Prices by Byron Wien of Blackstone

The Ten Surprises of 2015 have two prevailing themes. The more dominant is that the decline in the price of oil is generally a positive for the world. It puts money in the pockets of consumers everywhere and it is likely to force Iran and Russia to be more conciliatory in geopolitical negotiations because both countries are suffering not only from the drop in the oil price, but also from the sanctions imposed on them. The second theme is that in spite of notable economic problems in Europe, China and Japan, the United States equity market will have another good year.

2015-02-06 Earnings of Private Employees: A Big Recovery in January by Doug Short (Article)

First, here is a chart of the Average Hourly Earnings. I've included a linear regression through the data to highlight the trend. Hourly earnings increased at a faster pace through 2008, but the pace slowed from early 2009 onward. The December data point was a bit disturbing, a 5 cent month-over-month decline, the largest decline in the history of the series. However the January data point is a big bounce of 12 cents, the largest increase in the series.

2015-02-06 Diving Into the Payroll Report: Wages Rebound (But Don't Get Too Excited), Revisions, Huge Jump in L by Mike Shedlock of Sitka Pacific Capital Management

Wages rebounded from the dip last month (but don't get too excited as per details below). Also, there were big upward revisions to many prior numbers. The unemployment rate rose this month because of a huge increase in the labor force. The civilian institutional population also leaped this month, and apparently these newly-found people are all looking for work.

2015-02-06 Oil Prices: The Petro Plunge Continues in January 2015 by Harish Sundaresh of Loomis Sayles

Crude oil spot prices have dropped in a straight line to around $50 per barrel with no semblance of consolidation since the second half of 2014. In the near-term, weak supply/demand balance, high inventory, poor demand and a risk-averse investor could mean that oil prices will remain depressed.

2015-02-06 Fixed income macro and portfolio update by John Pattullo, Head of Retail Fixed Income (Article)

John Pattullo, Head of Retail Fixed Income, co-lead portfolio manager for the Henderson Strategic Income Fund (HFAAX) gives an appraisal of the macro environment and explains the current themes within the portfolio. John also shares his thoughts on recent announcement of quantitative easing (QE) made by the European Central Bank (ECB), the Greek vote and issues in the energy sector.

2015-02-06 Global Opportunities: The Next Leap Forward for Defined Contribution Investment Menus by Charles Roth of Thornburg Investment Management

Under ERISA, fiduciaries are obligated to ensure plan menus provide diverse investment options to help minimize the risk of long-term losses in account values. Global, non-traditional equity and fixed income options are sorely lacking in Defined Contribution (DC) plan menus. These op-tions can offer both lower correlation to U.S. markets and potentially strong returns, which par-ticipants increasingly need given the uncertainty surrounding Social Security’s future benefit levels.

2015-02-06 The Good News Behind GDP's Decline by Team of Guggenheim Partners

As the U.S. economy maintains its momentum and with the euro zone showing signs of improvement, all eyes are now on the Fed’s next move on rates.

2015-02-06 Quarterly Letter by Team of Grey Owl Capital Management

Over the past seven months the price of oil has plunged from a peak above $100/barrel to the mid-$40s today. This is just the most extreme version of the market volatility and divergence we began highlighting in our second quarter letter. A cautious investment stance remains the prudent choice.

2015-02-06 Metaphors and the message: Searching for deeper understanding of investment information by David Robertson of Arete Asset Management

Metaphors have a powerful influence on how we think about things and even on the evidence we consider important. Investors should be aware of this influence and how it shapes the way we perceive various messages and data points. An important application is to focus on metaphors that are consistent with your investment goals and philosophy.

2015-02-06 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Not everyone is happy about the dollar’s recent strength; Debt negotiations between Greece and its creditors are off to a rocky start; Wages may finally be reflecting the strong U.S. employment picture

2015-02-06 Outcome Investing: Blending Index and Active Strategies by Russ Koesterich of BlackRock

There is a lot to consider when building a portfolio. First and foremost, what is the end goal? Beyond that, investors need to also consider how much risk to take and over what time horizon? Another question that frequently comes up and is the source of many contentious debates: Should I consider indexed or active products? The simple and important answer is: both.

2015-02-06 A Contrary Opinion On The US Employment Report by Team of GaveKal

One of the main features of the current recovery is the drop in the potential growth rate. In every other recovery since WW2, real GDP has risen back to potential as the recovery got going, thereby closing the output gap. This time around, the output gap has narrowed because potential GDP has been revised down. This is an important point to understand when looking at today's jobs report.

2015-02-06 Key Questions for China Investors in 2015 by Andy Rothman of Matthews Asia

China raises many questions for investors. Last year, for example, GDP growth slowed to 7.4% from 7.7%, but China still accounted for almost one-third of global growth. Is this a healthy economy or an impending disaster? In the first of a three-part Sinology series, Andy Rothman, Matthews Asia Investment Strategist, addresses some key investor concerns.

2015-02-06 Inflation Expectations Have Increased Since Mid-January by Team of GaveKal

Since January 15th, 5-year TIPS derived breakeven inflation has increased 23 basis points from 105 basis points to 138 basis points. 10-year TIPS derived breakeven inflation has increased 16 basis points during this time and 30-year TIPS derived breakeven inflation has increased 8 basis points since the beginning of February.

2015-02-06 Active Opportunities in a Passive World by Norman J. Boersma, Cindy L. Sweeting and Heather Arnold of Franklin Templeton

Investors have heard the drumbeat for years that the days of actively managed mutual funds are numbered. After all, some experts maintain, the performance of active funds, especially after fees are removed, typically fall short of those of passive index funds, especially when the stock market is on an upswing. But the authors contend, with apologies to Mark Twain, that reports of the demise of actively managed funds have been greatly exaggerated. And, with the help of some prominent academics, they make the case for staying active.

2015-02-06 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.8, down from 131.6 the previous week. The WLI annualized growth indicator (WLIg) is at -4.0, up from the previous week's -4.3 and the interim -5.0 low in mid-January.

2015-02-06 Should I Stay or Should I Go: Global Diversification Could be 2015’s Winner by Liz Ann Sonders of Charles Schwab

Last year ended on a weak note for US equities; and January continued the trend; Divergences will remain a theme and likely keep volatility elevated; US investors haven’t felt the need to diversify globally…they should

2015-02-06 Detroit Reorganizes. The Muni Market Takes Notes. by Joseph Rosenblum of AllianceBernstein

Stockton. San Bernardino, California. Jefferson County, Alabama. Over the past few years, municipal bankruptcies (Chapter 9) have captured headlines. Detroit’s case, the largest municipal bankruptcy in history, was recently settled. What have we learned? Here are four key take-aways for muni market investors.

2015-02-06 China’s Millennials: Have Money, Will Travel by Sammy Suzuki of AllianceBernstein

China’s millennials are better educated and more affluent than their elders. They also have a serious case of travel fever. Their favored destinations, and shopping habits abroad, could have far-reaching implications for a wide range of global companies.

2015-02-06 High-Yield ETFs: Don’t Get Fenced In by Gershon Distenfeld of AllianceBernstein

Few high-yield investors have weathered the recent plunge in energy prices without experiencing at least a few bumps and bruises. But those who relied on broad market exchange-traded funds (ETFs) to gain market exposure are nursing the most serious wounds. Coincidence? We don’t think so.

2015-02-06 After the Perfect Storm in US Smaller-Cap Stocks by Bruce Aronow of AllianceBernstein

Last year was a tough one for US small- and mid-cap stocks, but there’s reason to think 2015 may be different. For investors who trimmed their smaller-cap allocation last year, we think it may be time to consider taking it back to its long-term target.

2015-02-06 Worried About US Stocks? by Joseph G. Paul of AllianceBernstein

After a jittery January, investors in US equities are gritting their teeth. But even if equities lose some steam after last year’s rally, we think company fundamentals and the interest-rate environment should support a resilient market in 2015.

2015-02-05 Macro View: Good Company, Bad Stock by Team of Guggenheim Partners

The U.S. economy is strong relative to other countries, but its equity valuations mean less upside potential for long-term investors than other areas of the world.

2015-02-05 Your Alpha is My Beta by Adam Butler, Mike Philbrick and Rodrigo Gordillo of Butler|Philbrick|Gordillo & Associates

A couple of weeks ago, I had the pleasure of a short correspondence with Lars Kestner, a well known quant and derivatives trader, and creator of the thoughtful K-ratio as a measure of risk adjusted performance. We connected on the definition of alpha, and how the term has been so abused in media and marketing as to become almost meaningless.

2015-02-05 Why own bonds? by Anthony Valeri of LPL Financial

A soft start for the U.S. stock market in 2015 once again illustrates the diversification benefit of high-quality bonds even at very low yields. Even in a low-yield environment, bonds provide a cushion as price movements, not yields, are the primary buffer to equity movements. An allocation to core bonds, in addition to more attractively valued high-yield bonds, may make sense for investors.

2015-02-05 The 2015 Economic Outlook: Opportunities and Risks by Derek Hamilton of Ivy Investment Management Company

In 2014, the global economy grew at roughly the same pace as the prior year. However, the composition was notably different. Developed market economies grew at a faster pace, while growth slowed in emerging market economies. The dollar strengthened and commodity prices weakened. Overall, we expect these trends to continue in 2015.

2015-02-05 Is the stock market sliding off an icy road? by Jerry Wagner of Flexible Plan Investments

As declines were registered in the major stock market indexes in December, the fear index certainly also increased among investors. Now with January, again, ending in the negative column, I imagine even more investors are beginning to fear that the bull market surge that began in 2009 may be coming to an end.

2015-02-05 Germany's "Time Pressure" Thesis; Noose Tightens on Europe by Mike Shedlock of Sitka Pacific Capital Management

Today German Chancellor Angela Merkel proclaimed Greek Diplomatic Offensive Is Failing. Merkel’s Christian Democratic-led bloc in parliament has agreed not to give in to any “bad compromise that “defacto adds up to a debt writedown,” Hans-Peter Friedrich, a deputy leader of the caucus, said in an interview today.

2015-02-05 Commercial Mortgage-Backed Securities: Approaching the Later Innings of a Recovery by Bryan Tsu of PIMCO

With the U.S. recovery as a supportive backdrop, PIMCO expects commercial real estate prices to rise 4%-6% in 2015. Commercial mortgage-backed securities issuance has increased for five years, and projections for 2015 are for growth of 20%-30%, driven largely by an increase in maturing loans on the supply side and the continued search for yield on the demand side. The growth in issuance does not come without concern: CMBS underwriting standards will likely continue to slip.

2015-02-05 ISM Data for January Point to Modest U.S. Real GDP Growth in 2015 Q1 by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) released data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers, and the media as they provide the earliest reading on the current state of the economy. The ISM provides data on the current performance of a number of indicators related to the manufacturing and non-manufacturing industries, such as production, employment, new orders, and backlog of orders, deliveries, inventories, new exports, imports, and prices.

2015-02-05 US vs G7: Decoupling? Recoupling! by Alexander Giryavets of Dynamika Capital L.L.C.

We review how the U.S. growth and inflation relate to that of G7 over the last forty years and conclude that not only the decoupling incidents are nothing more than temporary deviations seen as noise in the long run but also that U.S. has actually just recoupled.

2015-02-05 What To Look For When The Price Of Oil Has Bottomed by Urban Carmel of The Fat Pitch

SPX has now fallen 4 of the last 5 weeks, including this past one. For the week, SPX and DJIA each lost nearly 3% and NDX lost 0.8%.

2015-02-05 The Pursuit of Pricing Power by Robert McConnaughey of Columbia Management

Recent oil and commodity price declines have raised concerns about global deflation and price stability. While the circumstances around oil’s precipitous decline are unique, many industries have built up capacity in recent years to serve a level of global growth that is not likely to reappear in the intermediate future.

2015-02-05 The Long View: Is The Bull Market In Bonds Almost Over? by Lance Roberts of Streettalk Live

There has been much debate about the current low levels of interest rates in the economy today. The primary argument is that the "30-year bull market in bonds", due to consistently falling interest rates, must be near its end. Of course, this debate has devastated the "bond bears" who have consistently been frustrated by lower interest rates despite their annual predictions to the contrary. However, just because interest rates are currently low, does this necessarily mean that they must rise?

2015-02-05 Ditch the Good, Buy the Bad and the Ugly by Ben Inker of GMO

In a new quarterly letter to GMO's institutional clients, co-head of asset allocation Ben Inker provides background on why, "as the New Year begins, we in Asset Allocation find ourselves slowly selling down even our beloved U.S. quality stocks in favor of the various problem children of the investing world" ("Ditch the Good, Buy the Bad and the Ugly").

2015-02-05 Why Were We So Surprised? by Jeremy Grantham of GMO

Chief investment strategist Jeremy Grantham examines the sources for the "unique decline" in the oil price since June, and offers an outlook for the coming years -Why Were We So Surprised? The Oil Glut, Saudi Decisions, and the Uniqueness of U.S. Fracking

2015-02-04 Why global currency investing still makes sense by Michael A. Cirami, Eric Stein, John R. Baur, Matthew F. Murphy, Jr., Bradford Godfrey of Eaton Vance

Why global currency investing still makes sense – even amid a strong dollar We believe there are three reasons why many investors should remain committed to a diversified global currency strategy – even if the US dollar remains strong.

2015-02-04 Woody Hayes on Portfolio Management by William Smead of Smead Capital Management

“There are three things that can happen when you pass the football and two of them are bad,” observed The Ohio State University’s legendary coach Woody Hayes. All the Seahawk fans, myself included, know exactly what he is talking about since the Seahawks chose to pass the ball at the one-yard line. You can complete a pass, you can throw it for an incompletion, or you can throw it to the other team (an interception). The same thing can be said for existing common stocks in your equity portfolio.

2015-02-04 The Trouble With Zero by Roger Nusbaum of AdvisorShares

We have watched the decline in crude noting the slow decline that started in June that then turned into a crash starting at around $75 at Thanksgiving. The circumstances of crashes are always “different” but the market action is very similar almost every time and the oil market is showing the same pattern for now.

2015-02-04 The Opportunity in Volatility by Heather Rupp of AdvisorShares

While 2014 was characterized largely by the lack of volatility for most the year, and active management suffered as a result, we see those tables turning in 2015 as we expect this volatility to continue. As we sit today, we see an attractive entry point into the high yield market for active managers who can parse through the space to determine where there is value to be had, and where there are value-traps.

2015-02-04 Australia Coming Apart at the Seams by Mike Shedlock of Sitka Pacific

With the huge spotlight on Europe, Greece, the US Dollar, Canada, Switzerland, and China, it's easy to lose track of major things outside of mainstream attention. Like what? Like Australia. Australian Government on Brink of Collapse

2015-02-04 The Absolute Return Letter - January 2015 by Team of Absolute Return Partners

In large parts of the financial community there is a strongly held belief that the problems which caused the credit crisis back in 2008-09 have never been properly addressed, causing many to suspect that it is only a matter of time before the ‘end game’ is upon us – the credit crisis Mk. II so to speak. I will in the following pages look at various ways the end game might unfold but, before I do so, I shall return to one of the subjects I discussed in the January letter – the end of cheap oil – which caused a flurry of comments and questions.

2015-02-04 Developed Europe: Economy Trends Update by Team of Thomas White International

Thomas White International seeks superior performance by identifying undervalued securities in the U.S. and nearly 45 markets worldwide. Its flagship product is the Thomas White International Fund (TWWDX).

2015-02-04 Global Carry Rock ‘n’ Roll by Alexander Giryavets of Dynamika Capital L.L.C.

Global Carry (known as Risk Parity to some) got a bit of a headwind in December (as we proclaimed it to do on Black Friday) but went straight back to Rock ‘n’ Roll as this year started, good to great. And while the other utterly famous star – the Yen is patiently await, shocked and subdued by her competitor act, all the eyes are on the King of Rock – the Dollar. Some still have his last year stellar performance tune on the mind, but is he about to sing “The times they are a changin’”?

2015-02-04 Is It Time for Our Industry To Embrace Mass Personalization? by Patty Quinn McAuley of Clark Capital Management Group

Nike. Coca-Cola. Oakley. They are all top brands in the global marketplace and they have all led the charge towards mass customization and personalization. You can build a custom pair of Nike Free Run sneakers online, incorporating your favorite designs and colors. You can put your name on a virtual Coke bottle and “share” it on social media. You can even custom-build your own shades on, creating your own unique pair of sunglasses.

2015-02-04 What's Up? Quantitative Easing and Inflation by Chris Brightman of Research Affiliates

The Fed has ceased its program of quantitative easing (QE) and may soon begin to raise interest rates. Japan has embarked on an even more aggressive program of QE. The European Central Bank (ECB) has just begun QE. In a related development, the Swiss National Bank (SNB) recently stopped pegging the Swiss franc to the euro. Many investors are asking, “What does all this monetary turmoil mean?”

2015-02-04 Greek Drama by Chris Brightman of Research Affiliates

Alexis Tsipras, the new prime minister of Greece, was elected because he and the Greeks who voted for him oppose the austerity imposed by Greece’s creditors. Apparently, markets were shocked by this turn of events: Greek bond yields spiked and bank stock prices plunged as euros began flowing out of the country. But should this scene have been a surprise?

2015-02-04 There's Diversity in Value by Brent Leadbetter and John West of Research Affiliates

A portfolio comprising long positions in individual fundamentally weighted country indices and short positions in cap-weighted country indices might prove to be the Boris Diaw of a diversified portfolio. Investors would be unlikely to meet their return targets by concentrating all their assets in such a strategy. However, given its high Sharpe ratio and low correlation with widely used asset classes, it seems a suitable addition to a robust asset mix.

2015-02-04 Don't fret about January effect by Burt White of LPL Financial

The stock market fell in January, causing some to ask whether the so-called January effect means that stocks will fall this year. Recall less than four weeks ago the “first five days” indicator sent a positive stock market signal for 2015. We always put fundamentals first when forecasting stock market direction—and on that score, we believe stocks still look good.

2015-02-04 Gallup CEO Calls 5.6% Unemployment Rate "The Big Lie": What's a Realistic Unemployment Rate? by Mike Shedlock of Sitka Pacific

On Linked-In, Gallup CEO, Jim Clifton proclaims 5.6% unemployment is "The Big Lie". And it is. I have talked about this for years, but perhaps it would be interesting to hear the same thing from a CEO of a big agency. I picked this story up from ZeroHedge.

2015-02-04 January employment report preview by John Canally of LPL Financial

The market is expecting the economy to add 235,000 net new jobs in January 2015 and for the unemployment rate to remain at 5.6%. Other measures of the health of the labor market--hiring rates, the quit rate, the unemployment rate, and most importantly, wages--still show that the labor market is not yet back to normal.

2015-02-03 Facing Reality by Questioning Some Common Beliefs by Ron Surz (Article)

I've decided to do something different in this quarterly commentary. I begin as usual with a review of first quarter market performance. Then I turn my attention to some commonly held beliefs that I regard as mistaken, as shown in the figure below.

2015-02-03 How to Link Retirement Strategies to Sustainable-Spending Rates by Wade Pfau (Article)

Last week, my article introduced the Retirement Accumulation and Retirement Affordability indices, which help clients determine if they are retiring at a good time. In this article, I will present my new Retirement Dashboard. More specifically, I will explain how advisors can determine the appropriate sustainable-spending rate based on their client's desired spending pattern.

2015-02-03 Ben Hunt: Investing Lessons from the Poker Table by Justin Kermond (Article)

Markets have not been this dominated by political uncertainty and divorced from economic fundamentals since the 1930s. Ben Hunt - Harvard Ph.D., the author of the Epsilon Theory Newsletter, and Chief Risk Officer at Salient Partners, an asset manager based in Houston, TX - provides useful lessons from game theory for thriving in what he calls "the age of central bankers."

2015-02-03 The Secret to Empathizing with Prospects by Daniel Solin (Article)

It's quite easy to empathize with a loved one. But how do you demonstrate empathy with your prospect, who is a stranger?

2015-02-03 Coaching an Uncooperative Employee by Beverly Flaxington (Article)

Is it possible to coach someone who doesn't really want the job they have?

2015-02-03 Doing Business Through the Know, Like, and Trust Process by Teresa Riccobuono (Article)

We have all heard the phrase, "People like doing business with people they know, like and trust." But how does one get to the point of trust in a relationship?

2015-02-03 Making Your Practice a Magnet for Seniors by Dan Richards (Article)

Many advisors believe that their practice is senior-friendly if their office doesn't require climbing a flight of stairs and their client newsletters are in large type. To test that premise, recently I hosted a roundtable lunch for several advisors who've built a niche working with seniors.

2015-02-03 A Greek Morality Tale by Joseph E. Stiglitz of Project Syndicate

When the euro crisis began a half-decade ago, Keynesian economists predicted that the austerity imposed on Greece and the other crisis countries would fail. Now that it has, what is needed is not structural reform in Greece so much as a fundamental reform of the eurozone's design and policy frameworks.

2015-02-03 Deflation: Consternation Not Elation by Matt Lloyd of Advisors Asset Management

Deflation has been around ever since there was an excess supply of something or when demand had plummeted. The term “deflation” has now become mainstream in the general public’s lexicon, though the understanding of the declining economic growth that corresponds with it is often disregarded until it wreaks havoc on the consumer’s paycheck. When we see deflation permeating global economics, market movements and NFL games, the general public will become acutely aware of the other major impact from deflation, the increasing symbiotic nature of all the global economies.

2015-02-03 Connecting the Dots: Procter & Gamble, the Strong Dollar, and Pepto Bismol by Tony Sagami of Mauldin Economics

Collectively, the 500 companies in the S&P 500 get 46% of their sales and roughly 50% of their profits from outside the US. They are truly multinational giants. Expanding your customer base is always a good thing, but doing business overseas is not without peril, and one of the under-appreciated perils is the impact of currency movements.

2015-02-03 Retirement Realities and Contingencies by Roger Nusbaum of AdvisorShares

Stites on Estates took an interesting look at retirement intentions versus retirement reality along with a reiteration of the dismal statistics about how little savings people who are working have accumulated as well as how few dollars people have put away when beginning their retirement.

2015-02-03 The Bravado of Borrowers by Peter Schiff of Euro Pacific Capital

Last week a scene unfolded in Athens, largely unnoticed by American eyes, that provided all the visual and metaphorical symbols needed to define the current state of the global economy. Hollywood's best screenwriters couldn't have laid it out any better.

2015-02-03 Americas Economy Trends Update January 2015 by Team of Thomas White International

Thomas White International seeks superior performance by identifying undervalued securities in the U.S. and nearly 45 markets worldwide. Its flagship product is the Thomas White International Fund (TWWDX).

2015-02-03 PIMCO Introduces the PIMCO Multi-Strategy Alternative Strategy by of PIMCO

In a New Neutral environment that anticipates muted returns and heightened volatility, many investors have looked to liquid alternatives in an effort to boost returns and lower overall portfolio risks. Our approach seeks to efficiently combine a range of complementary liquid alternative strategies, offering the potential for diversification and higher return per unit of risk than a single strategy could achieve on its own. This strategy can play a central role in liquid alternatives allocations or be used as a stand-alone complement to traditional stock and bond allocations.

2015-02-03 Diving Into the ISM: What's It All Mean? by Mike "Mish" Shedlock of Sitka Pacific Capital

This morning the Institute for Supply Management released its much followed Manufacturing ISM® Report On Business®.

2015-02-03 Municipal Market Perspectives by Team of SMC Fixed Income Management

Pick your poison: weaker oil and copper prices; increasing gold demand; Swiss Franc and Canadian Dollar devaluations; another possible Greek tragedy; launch of European Central Bank (“ECB”) bond buying program; waning emerging markets; weakening U.S. stock prices; global deflation worries. It appears to us that the broadening global weakness could be beginning to negatively impact the U.S. expansion. Given the current state of global events, we see no reason for the Fed to prematurely move ahead with its rate normalization plan as many anticipate occurring by mid-year 2015.

2015-02-03 Tax Reform: No Hope for Change by Milton Ezrati of Lord Abbett

The latest proposals from the White House all but ensure that no progress will be made on sorely needed tax-code fixes in 2015.

2015-02-03 Woody Brock on Why to Own Stocks Now - Video by Robert Huebscher (Article)

Dr. Horace 'Woody' Brock is the founder Strategic Economic Decisions and the author of American Gridlock. In a recent talk, he explained why investors should own stocks ? particularly those with stable dividends ? and why bonds are very risky in today's environment. This is the video; a transcript of this talk is also available.

2015-02-03 Seeking Value Amid Volatility by Russ Koesterich of BlackRock

Stocks struggled last week, and once again the losses were most pronounced in the United States. Financial markets remain highly volatile, with violent swings in the oil price and interest rates adding to the angst. With the Fed likely to start removing monetary accommodation, 2015 was bound to be a more volatile year than last.

2015-02-02 Market Action Suggests Abrupt Slowing in Global Economic Activity by John Hussman of Hussman Funds

The combination of widening credit spreads, deteriorating market internals, plunging commodity prices, and collapsing yields on Treasury debt continues to be most consistent with an abrupt slowing in global economic activity.

2015-02-02 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Last week the Trade Followers social media indicators for the S&P 500 Index (SPX) suggested that the market wasn’t out of the woods yet due to several factors. Chief among them was a warning from our sector sentiment readings. They indicated that market participants were rotating to safety as the market rallied. Every time all sectors were positive since we’ve been tracking them has resulted in a short term top within two weeks.

2015-02-02 Weighing the Week Ahead: Will the data deluge signal economic weakness? by Jeff Miller of New Arc Investments

This is a landslide week for economic data, and earnings season is in full swing. Last week’s Q4 GDP report and overall market tone has revived deflation concerns. I expect market participants to be watching each economic release closely, asking: Are there signs of incipient economic weakness?

2015-02-02 What Is Plan B for Greece? by Kenneth Rogoff of Project Syndicate

Though the far-left Syriza party’s recent election victory has sent Greek equities and bonds plummeting, there is little sign of contagion to other distressed countries on the eurozone periphery. The question is how long this relative calm will prevail.

2015-02-02 Perception vs Reality - Rates of Return by John Riley of Cornerstone Investment Services

What is the annual average rate of return for the market? 10.00%? 12.50%? 15.00%? This is one of those "facts" that investors hear from friends, the media and the investment industry, and it is usually wrong.

2015-02-02 Why the Rest of 2015 May Not Look Like January by Robert Doll of Nuveen Asset Management

January was a rough month for equity markets. Volatility increased and stocks endured some notable setbacks. For the month, the S&P 500 Index fell 3.0% after declining 2.8% last week. We believe, however, that the same factors pushing stock prices lower will actually support longer-term economic growth. We expect markets will stabilize and recover in the coming months, and believe that by the end of 2015 equity prices will be at a higher level than where they began the year.

2015-02-02 Fooled By Extrapolation by Brian Wesbury, Robert Stein of First Trust Advisors

Pundits have a bottomless reservoir of pessimism and also a magnified ability to extrapolate the most recent trends. So, when Q1-2014 real GDP fell at an annual rate of 2.1%, fear turned rampant.

2015-02-02 Portfolio Strategies 2015: Investing in an Age of Divergence by John Mauldin of Mauldin Economics

Everyone is worried about being blindsided by a significant downdraft in the markets when maybe we should be thinking about making sure we don’t miss a bull market somewhere. These and several dozen other topics were on the table when the Mauldin Economics writing team gathered here in Dallas for 3½ days of intensive talk, interviews, and planning. Today we’ll go over a few of the highlights of this last week, and I’ll share a few reasons to be optimistic about 2015.

2015-02-02 The Latest on Real Disposable Income Per Capita by Doug Short (Article)

With the release of today's report on December Personal Incomes and Outlays we can now take a closer look at "Real" Disposable Personal Income Per Capita.

The December nominal 0.22% month-over-month increase in disposable income rises to 0.45% when we adjust for inflation, thanks to a -0.23% month-over-month decline in the PCE price index. The year-over-year metrics are 3.76% nominal and 2.98% real.

2015-02-01 Weekly Market Summary by Urban Carmel of The Fat Pitch

SPX has now fallen 4 of the last 5 weeks, including this past one. For the week, SPX and DJIA each lost nearly 3% and NDX lost 0.8%. Tthe indices and most of the sectors have fallen under their key moving averages. Many of these now have a declining slope. Over the past month, price has made lower highs. All of this suggests that the trend is down. Moreover, bullish set ups are failing, a warning that price has not reached an oversold level. Despite the sell off, breadth and longer term measurements of sentiment have not washed out to an extent that would suggest a low is in place. Finally, th

2015-01-31 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Calculating the consequences of budget policies is a global headache. The recent round of central bank easing may continue for a while. Reports of a budding currency war are exaggerated

2015-01-31 The Super Bowl of Investing by Robert Isbitts and Vincent Esposito of Sungarden Investment Research

Here is our list of official National Football League penalties — as applied to investors. Don’t get penalized, think your way through today’s environment, or find a money management specialist who can.

2015-01-31 Diverging Policies…Converging Economies? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The US economy should continue to expand but faces headwinds with weak global growth and a strengthening dollar leading to diverging central bank policies. Volatility has risen and the potential for a correction in the near term appears more likely. Nonetheless, timing the market in the shorter-term is dangerous, while the longer-term picture still looks positive for US equities. Across the pond, we remain skeptical much can be accomplished with the ECB’s QE program and continue to favor emerging markets over developed internationally. We also believe global diversification is becomin

2015-01-31 Encouraging Lifetime Income in US DC Plans by Daniel A. Notto of AllianceBernstein

With the continuing shift from defined benefit (DB) plans to defined contribution (DC) plans, fewer Americans have the ability to enjoy guaranteed income for life. Now, federal regulators are trying to change that.

2015-01-31 An Unconventional Truth by Nouriel Roubini of Project Syndicate

To be effective, monetary stimulus must be accompanied by temporary fiscal stimulus, which is now lacking in all major economies. That is why, given persistent insufficient aggregate demand, unconventional monetary policies will remain a central feature of the macroeconomic landscape.

2015-01-30 Finding Tax-Free Transfer Opportunities in Undervalued Energy Stocks by Carin Pai, Elisa Shevlin Rizzo of Fiduciary Trust Company International

In the past few weeks, crude oil has extended its biggest price slump since the 2007-2009 global financial crisis, dropping to the lowest levels since 2009 amid signs of softer demand growth from major economies, strong output from the US and steady output from the rest of the world.

2015-01-30 PIMCO Extends Its Dividend Suite With Two New Regional Strategies by Brad Kinkelaar, Adam Muller of PIMCO

As is the case with our other dividend strategies, we are unconstrained by benchmarks and focused on generating yield and capital appreciation by finding attractively valued companies that pay appealing dividends today and have an ability and willingness to grow dividends over time.

2015-01-30 The Great Complacency...Continued by Jeffrey Bronchick of Cove Street Capital

At this point last year, we were effusively cautious after a period of terrific performance. We suggested that while we considered a material number of portfolio stocks to represent "solid" values, their near-term appreciation was going to be limited after the big numbers of 2013.

2015-01-30 Is Dividend Investing Passe? by Yu Zhang of Matthews Asia

Dividends can be used as a lens through which we attempt to identify high-quality, financially healthy companies with prudent capital allocation policies.

2015-01-30 Over Half The Stocks In The MSCI World Index Are Outperforming The Index For The First Time In A Yea by Team of GaveKal Capital

For the first time in exactly one year, over half the stocks (51%) in the MSCI World Index are outperforming the headline MSCI World Index over the past 252 trading days (1-year). This is the highest percentage of stocks outperforming in exactly one year.

2015-01-30 The Next Act in the Greek Drama by Russ Koesterich of BlackRock

The outcome of Greece’s election suggests a prolonged period of heightened tensions and difficult negotiations with the troika. Compromises are possible, but reform efforts could fall by the wayside.

2015-01-30 Weighing the Odds of Compromise in Greece, and the “Grexit” by Heather Arnold, Cindy Sweeting, Norm Boersma of Franklin Templeton Investments

Against a backdrop of growing dissatisfaction with Greece’s bailout terms [imposed by the “troika” of lenders comprised of the European Commission, European Central Bank (ECB) and International Monetary Fund], the country’s parliament failed to decisively elect a president in December 2014, resulting in the dissolution of the parliament and the calling of new elections for January 25, 2015.

2015-01-30 7 Things about Saudi Arabia You Need to Know by Frank Holmes of U.S. Global Investors

A week ago we learned that the king of Saudi Arabia, Abdullah bin Abdulaziz Al Saud, passed away at the age of 90. Following the announcement, crude oil immediately spiked 2.5 percent over uncertainty of how this might affect the Middle Eastern kingdom’s position on keeping oil production at current levels.

2015-01-30 Reforms in Asia Bring Big Potential for Small Companies by Team of Franklin Templeton Investments

At Templeton Emerging Markets Group, we believe Asia’s combination of rapid economic growth, generally strong national finances and economic fundamentals has created an attractive landscape for equity investors. Seismic changes have been taking place in Asia’s political arena over the past couple of years, including major elections, leadership transitions and even a military coup. These political shifts have economic reform implications as well.

2015-01-30 Opportunities and Risks for Investors After the Oil Price Slump? by Daniel Lacalle of PIMCO

What we are seeing now is that oil prices, when OPEC refuses to balance the market, test the marginal cost of production, and costs fall. Some of the costs of the largest components of oil projects – high-spec sixth-generation rigs, pressure pumping, seismic, completion – have fallen between 20% and 45% in the space of months as overcapacity became evident and capital expenditure was revised downward.

2015-01-30 Wall Street for President? by Simon Johnson of Project Syndicate

America's Democratic Party – including President Barack Obama – is apparently of two minds on the extent to which it should defend its own financial legislation from attack by the country's powerful megabanks. It can have the 2010 Dodd-Frank reforms, or it can have Wall Street's campaign contributions, but it cannot have both.

2015-01-30 Voya Fixed Income Perspectives – January 2015 by Christine Hurtsellers, Matt Toms of Voya Investment Management

Voya Investment Management’s fixed income strategies cover a broad range of maturities, sectors and instruments, giving investors wide latitude to create a new portfolio structure or complement an existing one.

2015-01-30 Accentuate the Positive: The Psychological Inflation of Quarterly GDP by Doug Short (Article)

Note from dshort: I've updated the last chart in this commentary to include today's Q4 GDP Advance Estimate of real quarterly GDP. The BEA's annualized growth rate of 2.6% (2.64% to two decimals) is based on a 0.65% quarter-over quarter percentage change.

2015-01-29 Household Income versus Family (Tax-Unit) Income by Doug Short (Article)

My virtual acquaintance New Deal Democrat has posted an interesting article on real (inflation-adjusted incomes) based on annual IRS tax data through 2013. His discussion includes some comparisons between the Census Bureau's median Household Income data and the Family Unit average income. A Family Unit is the term used for an IRS designated Tax Unit (e.g., a couple with dependents, or a head of household with dependents, or a single person).

2015-01-29 The Unintended Consequences of "Sophisticated" Performance Measurement by Francois Sicart of Tocqueville Asset Management

Sicart believes a measure of investment success should encompass "several cycles, with bull and bear markets as well as many fads and fashions and their aftermaths." He notes that "economic events really progress at a near-tectonic pace," so "a quarter or even a year is almost always a totally irrelevant period."

2015-01-29 We Didn?t Start the Fire by Robert Waas of RSW Investments

History shows that what starts as an overall lack of fear, becomes outright complacency, which inevitably leads to the "Minsky Moment" of instability. Virtually every major Central Bank has outright expressed, or at the very least implied to market participants that not only do they have "our backs", but our backsides too! If distorted markets create distorted behavior, we can logically infer that unprecedented excesses exist somewhere in the system and probably in many places. The entire financial system has been re-stocked with dry kindling and oil is the most likely mat

2015-01-29 Commodity Outlook 2015: Watching the Supply Response Across Markets? by Nicholas Johnson, Greg Sharenow of PIMCO

Today?s low oil prices should allow for supply and demand to come back into alignment by year-end, led by a decline in the U.S. output growth rate and a modest increase in global demand. We expect continued oversupply to weigh on natural gas prices this year, but some semblance of balance may return to this market in 2016. Grain prices may experience pressure in 2015 as low oil prices pass through to corn prices, which may cause producers to switch to higher-priced crops. With production growth likely having peaked, we expect metals prices to stabilize this year.

2015-01-29 What's Up? Quantitative Easing and Inflation by Chris Brightman of Research Affiliates

In a recent piece from Research Affiliates, Chris Brightman, chief investment officer, provides "Central Banking 101," noting that just within the last several months the Fed has ceased its program of quantitative easing (QE) and may soon begin to raise interest rates, Japan has embarked on an even more aggressive program of QE and the European Central Bank (ECB) has just begun QE. In a related development, the Swiss National Bank (SNB) recently stopped pegging the Swiss franc to the euro. Many investors are asking, ?What does all this monetary turmoil mean??

2015-01-29 The Strange Case of the Current Small-Cap Cycle by Team of The Royce Funds

For much of the past five years, small-cap stocks have generated returns well above their monthly rolling five-year averages. In addition, lower-than-usual volatility within the asset class and a decline in the cost of capital spurred by the Fed?s monetary stimulus programs have created an unfriendly environment for active stock pickers such as ourselves. Our latest research, however, suggests that some of these conditions were abating late in 2014, which might benefit those investors who focus on fundamentals and try to use volatility to create longer-term opportunities.

2015-01-29 Is US Sliding Into Recession? by Alexander Giryavets of Dynamika Capital L.L.C.

Almost a year ago we identified the late cycle symptoms in sector rotations, leading indicators and US treasuries term structure. We briefly review where we stand and conclude that it does not look pretty.

2015-01-29 Rate Hikes Still A Few Meetings Away by Brian Wesbury, Robert Stein of First Trust Advisors

No one expected the Federal Reserve to make any changes to monetary policy at today?s meeting and there were no surprises. The Fed continued to say it would be ?patient? before raising short-term interest rates, which means the Fed is very unlikely to raise rates through at least April.

2015-01-29 A Year to Think Small by Ted Baszler of Heartland Advisors

The current economic environment here and abroad could be setting up to benefit small-cap equities.

2015-01-29 Fed in Wait-and-See Mode by Team of Northern Trust

The Federal Open Market Committee (FOMC) concluded its meeting on an optimistic note. There were no dissents, following three at the December 2014 meeting.

2015-01-29 Games People Play by William Gross of Janus Capital Group

My mother taught me how to play Monopoly ? the game ? and the markets over 40 years past have taught me how to play Monopoly ? the financial economy. Financial markets and our finance-based economy are actually quite similar to the game in terms of the rules and strategies it takes to win. Monopoly?s real-time bank (the Fed) distributes money to players at the beginning and then continues to create more and more credit as the economy passes go.

2015-01-29 U.S. Long Bond: Panic Buying by Mark Ungewitter of Charter Trust Company

The demand for long-term Treasury bonds has reached panic proportions. A casual inspection of price history suggests that the rally since December 2013 is too steep, too fast. An alternative measure of intensity, the ratio of 30-year to 10-year bond prices is also flashing red. The price of 30’s relative to 10’s is rising at a pace not seen since the panic of 2008. Can an important top be far ahead?

2015-01-29 Advice for Investing in Today's Volatile Markets: 5 Points by John Calamos of Calamos Investments

In my view: (1) Volatility will likely continue at an elevated level. Falling commodity prices, global growth fears and political uncertainties in the euro zone are among the factors that will add to volatility in the markets over these next months. (2) The U.S. stock market can continue to advance for 2015. (3) Investors need to look through the short-term volatility and position their portfolios proactively and strategically. (4) Diversification is important?but bonds aren?t necessarily the right answer.

2015-01-29 Municipal Market Update: What's Ahead in 2015 by Joseph Deane, Julie Callahan, Sean McCarthy of PIMCO

Municipal bonds ended 2014 as one of the best-performing asset classes - buoyed by investors’ search for yield in a low interest-rate environment. For 2015, we are positioned cautiously for greater volatility in the fixed income markets. We currently prefer revenue-backed bonds over most general obligation (GO) debt, as these sectors typically benefit from dedicated revenue streams and do not have the pension challenges that many state and local governments face.

2015-01-29 A Very, Very, Very, Very Black Swan? by Jay Leopold of Columbia Management

Nassim Taleb’s book "The Black Swan" effectively demonstrates that seemingly highly improbable events are much more common than expected, often with significant consequences. In fact, experts are often blind to these occurrences because past data is not necessarily a good predictor of the future. Most investors are aware a black swan event hit the Swiss franc earlier this month.

2015-01-29 3 Things - Fed Mistake, ECB QE, Housing by Lance Roberts of Streettalk Live

On Wednesday, the Federal Reserve made their latest monetary policy announcement. Janet Yellen, the current Chairwoman, made several statements that led the markets to believe that they remain on course for increasing the overnight lending rate this year.

2015-01-29 Momentum X 2: Unleashing the True Power of Momentum by Gordon Nelson of Keystone Wealth Advisors

Momentum is one of the most researched market anomalies and has become widely accepted and used in a variety of ways for investment management. When used in practice is it most commonly referred to as relative strength or relative momentum. What happens if we combine the power of relative momentum with absolute momentum?

2015-01-29 Contrarian View: A More Balanced Approach to Rate Risk in 2015 by Scott Eldridge of Invesco Blog

The threat of higher interest rates is dominating many 2015 outlooks for investors and professional forecasters alike. Consensus expectations call for the Federal Reserve (Fed) to begin tightening in the second half of the year, with market rates to rise in concert and bond prices to fall. But the changing composition of voting members on the Federal Open Market Committee (FOMC) is a looming variable that I believe will likely impact the pace and severity of Fed action.

2015-01-28 Sell-off in Corporate Credit Creates Income Opportunities for 2015 by Payson Swaffield of Eaton Vance

In this insight, Payson puts last year?s bond market volatility and performance in perspective and points out potential investment opportunities across market sectors in 2015.

2015-01-28 Thoughts on Energy by Doug Ramsey of Leuthold Weeden Capital Management

We?re not certain that the historic rout in the Energy sector is over, and even if we were our Group Selection (GS) Scores would likely prohibit us from loading up on Energy subgroups for at least a few more months. Last decade we frequently discussed the ?Three Act Play? then unfolding in commodities, with the terminal act producing a 2006-2008 surge in commodity-oriented equities and a commensurate binge in capital spending. While all of the commodity sector participated, Energy certainly played either a lead or a co-starring role.

2015-01-28 Black Cypress: Ignore the Bears; The Force(s) are with Us by Alan Hartley of Black Cypress Capital Management

The U.S. economy should continue to expand and that bodes well for stocks. The next bear market will likely start due to a recession or geo-political conflict and not from the start of Fed interest rate increases or time elapsed. The current economic landscape is favorable to growth. Stock markets are priced for low returns.

2015-01-28 The Benefits of Proper Risk Budgeting by Roger Nusbaum of AdvisorShares

William J. Bernstein had an interesting op-ed in the Wall Street Journal titled How To Tell If Your Retirement Nest Egg Is Big Enough. Anytime the term nest egg pops up in a post I feel compelled to make the Lost in America reference when Julie Hagerty loses the nest egg at the tables in Las Vegas almost immediately after they hit the road and Albert Brooks tells her to never use the words nest and egg in the same sentence ever again.

2015-01-28 European Central Bank Embraces QE, For Better Or Worse by Gary Halbert of Halbert Wealth Management

Last Thursday, European Central Bank (ECB) President Mario Draghi announced the much-anticipated launch of a sovereign bond buying program at the rate of ?60 billion ($70 billion) per month known as ?quantitative easing.? The amount of the monthly purchases was slightly higher than had been expected.

2015-01-28 Is There A Case For German Equities? by Team of GaveKal Capital

With the highest productivity in Europe, a sizeable current account surplus and rock bottom interest rates, is there a case to made for German equities? Germany's competitiveness, export performance and trade surplus should increase as the Euro weakens helping German exporters in markets outside of the Euro bloc.

2015-01-28 Global Economic Perspective: January by Christopher Molumphy, Michael Materasso, Roger Bayston, Michael Hasenstab, John Beck of Franklin Templeton Investments

After a much better-than-expected annualized growth rate of 5% in the third quarter of 2014, the stars would seem to be fairly much aligned for continued US growth in the months ahead. Job growth has continued apace, interest rates and energy prices have remained low, and consumer and business confidence has been buoyant. As we start the new year, the main areas of uncertainty would seem to be the pace of growth and the implications of recent price and employment trends for the timing of monetary tightening by the US Federal Reserve (Fed).

2015-01-28 Why European Euphoria Isn?t Likely to Last by Russ Koesterich of BlackRock

The ECB took definitive action against deflation fears with a broad asset purchase program that impressed the markets. Here is a quick analysis of its impact on stocks and bonds beyond the short term.

2015-01-28 Random Thoughts on a Cruise to Nowhere by Jeffrey Saut of Raymond James

We have lost our way as a people and a country when we ignore and/or fail to see the significance of history. King Abdullah and his father King Abdul Aziz al Saud were titans of the modern day middle east that so affected us all. I read about his death in the B section of the local paper after a story about our local nursing home under new management. God, Allah, Adonai ... please help us all.

2015-01-28 The Road Back, and Ahead by Scott Brown of Raymond James

The U.S. economy data are likely to be mixed in the near term, but there is little doubt that we are gathering steam. The plunge in gasoline prices is an enormous tailwind. However, this isn?t just an energy story. The fundamentals are getting better.

2015-01-28 Forecasting Q4 GDP: A Look at the WSJ Economists' Collective Crystal Ball by Doug Short (Article)

What do economists see in their collective crystal ball for Q4? Let's take a look at the GDP forecasts from the latest Wall Street Journal survey of economists conducted earlier this month.

Here's a snapshot of the full array of WSJ opinions about Q4 GDP. I've highlighted the values for the median (middle), mean (average) and mode (most frequent).

2015-01-27 Looking Back at James Montier's "Perfect" Value Investors by Larry Swedroe (Article)

Is there such a thing as a "perfect" value investor? And if so, what does that investor's fund look like? James Montier thought he knew the answers when he penned his 2006 article "The Perfect Value Investor." Let's look back and see how that portfolio did.

2015-01-27 Key Issues for 2015: The View from Western Asset by Sponsored Content from Legg Mason Investor Services LLC (Article)

The U.S. represents a bright spot in a global recovery best characterized as "two steps forward, one step back." Sector and issue selection remain crucial in this environment, but so do macroeconomic strategies, which may help provide ballast when the pace of recovery slows.

2015-01-27 Introducing the Retirement Wealth and Affordability Indices by Wade Pfau (Article)

How can you help clients determine if they are retiring at a good time? I aim to answer that with my recently developed Retirement Accumulation Index and Retirement Affordability Index. Let me explain how those two indices work and how you should use them with clients.

2015-01-27 The Unspoken Issue that Will Cost You Clients by Dan Richards (Article)

Advisors spend lots of time addressing their clients' concerns about markets, interest rates and their retirement plans. But a recent conversation with a client identified an important concern that is typically ignored.

2015-01-27 The Warren Buffett Way: High Quality Stocks in Emerging Markets by Baijnath Ramraika, CFA® and Prashant Trivedi, CFA® (Article)

A simple three-factor quantitative process for selecting emerging-market high-quality stocks outperforms the publicly traded benchmarks and does so with lower risk.

2015-01-27 How Monkeys and Peanuts Can Help You Gather AUM by Daniel Solin (Article)

Monkeys love peanuts. To understand how that relates to gathering assets under management (AUM), let's revisit a study demonstrating that emotions drive decisions.

2015-01-27 2014 Global Factor Round Up by Michael Nairne (Article)

Factor performance can vary as a result of business cycle influences, market sentiment, interest rate changes, sector composition and other variables. Here are the returns earned by each factor globally in 2014 compared to the overall broad market.

2015-01-27 The Characteristics of a Great Sales Culture by Beverly Flaxington (Article)

If you don't think your sales culture is strong enough, here is a guideline for developing a more robust sales culture.

2015-01-27 Should Clients Select Lump-Sum Pension Payments? by Neal Angel (Article)

Employers are increasingly offering lump-sum pension payments. Should your client take the money? Or should they take the monthly paycheck for life?

2015-01-27 What Happened to the Secular Bear Market in Equities? by Martin Pring of Pring Turner Capital Group

History shows that US equity prices have consistently alternated between secular bull and bear trends. These price movements typically average 15-20 years in length and embrace several different business cycles. In April 2003 we published an article posing the question, ?Whither the Secular Trend of Equities?? which laid out the case for the year 2000 being a secular or very long-term peak for the US stock market. Since the three previous secular bears averaged just over 18-years, our working hypothesis was for a weak market until sometime around 2018.

2015-01-27 GDP, Strong Again by Brian Wesbury, Robert Stein of First Trust Advisors

With all the focus on Europe in general and Greece in particular, it?s important to keep in mind that the US economy continues to move forward. After real GDP dropped in the first quarter of last year, some analysts were predicting another recession. By contrast, we said the drop was due to unusually harsh winter weather and the economy would rebound quickly.

2015-01-27 Is Cheap Oil Here to Stay? by Milton Ezrati of Lord Abbett

The answer to that question depends on three key factors. Here?s a closer look at each.

2015-01-27 Five Consensus Views that Could Prove Wrong in 2015 by Edward Perkin of Eaton Vance

In this insight, Edward focuses on areas where consensus thinking may be flawed and explores potential opportunities for contrarians.

2015-01-27 11 Investing and Personal Finance Hacks by Roger Nusbaum of AdvisorShares

You?ve probably seen one or two of the listy articles about life hacks which are little tricks that can make the day to day routine a little easier. Some are for very mundane aspects of life like using a paper clip to mark the spot where the roll of tape starts or laying a wooden spoon across a pot of boiling water to prevent it from boiling over. I saw one of these lists a few days go where one of the hacks was a little off the beaten track, suggesting you always carry bolt cutters with you.

2015-01-27 Time to Get Off the Merry-Go-Round ?? by Jerome Schneider of PIMCO

In 2014, many investors de-risked their portfolios by moving into shorter-duration passive approaches but the potential for capital preservation from these strategies may face challenges. Passive benchmarks and strategies with pre-specified, structural interest rate exposure may have little to no flexibility around their positioning and may push investors into the heart of the proverbial storm. Active strategies not constrained by benchmark limitations may be optimal for investors as they can seek to manage exposure to interest rates.

2015-01-27 Global Equities 2015: Fasten Your Seat Belt for a Multi-Speed World by Virginie Maisonneuve, Mark Richards ? of PIMCO

We sat down recently with Virginie Maisonneuve, PIMCO?s CIO Global Equities, and equity macroeconomic analyst Mark Richards to discuss PIMCO?s global equity outlook for the coming year.

2015-01-27 The Cacophony of Earnings Announcements by William Smead of Smead Capital Management

As long-duration common stock owners, we are always interested and entertained when the media covers company earnings. To understand why, we think you need to know the facts behind the intrinsic value of a company, what it means to be a business owner and what differentiates a good business from a great one. Our contention is that there is little or no correlation between short-term stock price movements at the time of earnings reports and long-term success in common stock investing.

2015-01-27 Europe: A look at what lies ahead by Stephen Peak (Article)

Stephen Peak, Director of International Equities, comments on the recent ECB action of quantitative easing and how it provides another necessary ingredient for Europe to progressively improve during 2015. He sees the ECB action as a necessary component of what lies ahead for Europe – with the other components already in place that occurred through the second half of last year. He notes that while it has been a dramatic start to the year, the overall case for international markets looks decent and he believes that Europe will defy the doubters.

2015-01-27 No Deflating the U.S. Dollar by Burt White of LPL Financial

The latest leg up for the U.S. dollar has been driven by anticipation and arrival of QE by the ECB. The dollar has been strong for a number of reasons, all of them good things. Though not the end all and be all, currency is an important consideration when determining asset allocation.

2015-01-26 Global macro update: Risks and opportunities for early 2015 by Matthew Beesley (Article)

Matthew Beesley provides an update on global risks and opportunities for early 2015. In general, a good environment for equities is often one in which corporate profitability is growing, and corporate profitability is likely to be growing when GDP growth is present in the world. With a forecast for 2015 of GDP growth globally at 3%, Matthew suggests there are many attractive companies that may deliver decent earnings growth; particularly those companies that have valuations priced for a more disappointing outlook. Matthew seeks to offset risks to the downside by selecting companies where that

2015-01-26 Active and Passive: The Yin and Yang of Investing by (Article)

Stop the debate: active and passive investing are best when they work together. Despite underwhelming performance in recent years, keeping active managers in the mix is key to minimizing volatility and achieving alpha in investor portfolios. Zachary Karabell, Head of Global Strategy at Envestnet, explains in this short video.

2015-01-26 How Global Interest Rates Deceive Markets by John Mauldin of Mauldin Economics

When it comes to interpreting what current interest rates are telling us about the markets in various countries, I have to say that I do not think they mean what the market seems to think they mean. In fact, buried in that list of bond yields is ?false information? ? information so distorted and yet so readily misunderstood that it leads to wrong conclusions and decisions ? and to bad investments.

2015-01-26 Is Q-ECB a Favorable Development? by John Hussman of Hussman Funds

It?s not entirely clear what will happen in the near term, but the financial markets are already pushed to extremes by central-bank induced speculation.

2015-01-26 And the Winner Is... by Jerry Wagner of Flexible Plan Investments

The annual awards season for the entertainment industry has begun and will kick into high gear over the next two months. It has not been without some controversy already, as the acting and directing nominee lists for the 87th Academy Awards (to be presented on February 22nd) were criticized for a lack of diversity.

2015-01-26 Unknown Unknowns by Michael Kayes of Willingdon Wealth Management

How accurate are annual predictions about the market? What are the key drivers for stocks this year? Read on to find out..

2015-01-26 The Consumption of Davos by Scott Minerd of Guggenheim Partners

Europe?s central bank took bold action this week, consuming the conversation at the World Economic Forum?s Annual Meeting, but will it be enough?

2015-01-26 The Lemmings of QE by Stephen Roach of Project Syndicate

Predictably, the European Central Bank has joined the world?s other major monetary authorities in the greatest experiment in the history of central banking: large-scale quantitative easing. But careful analysis of QE's impact so far should give the ECB pause.

2015-01-26 The Fed -- Lucky or Smart? by Paul Kasriel of Econtrarian

Given the rapid growth in total thin-air credit, i.e., the credit created by the Fed and depository institutions, during most of 2014, the Fed was correct in phasing down the amount of securities it was purchasing if it wanted to avoid creating another asset bubble and/or an acceleration in price increases of goods and services. But when the Fed ended its securities-purchase program in October 2014, it appeared as though growth in total thin-air credit would slow precipitously in 2015 without some contribution from the Fed.

2015-01-26 Global Economic Growth Should Gradually Begin to Improve by Robert Doll of Nuveen Asset Management

Equity markets reacted to both positive and negative forces last week, but the positive factors won out in the end. Corporate earnings sentiment was lackluster and investors continued to focus on the negative effects of falling oil prices. However, markets experienced a significant tailwind from a more aggressive-than-expected quantitative easing announcement from the European Central Bank (ECB). For the week, the S&P 500 Index climbed 1.6%, snapping a three week losing streak.

2015-01-26 Rate Cut a Positive Jolt for India?s Growth Dynamics by Jack Deino of Invesco Blog

In a surprise move, the Reserve Bank of India (RBI) cut its policy rate for the first time in two years on Jan. 15 by 25 basis points (bps) to 7.75%. Encouraged by multiple anti-inflationary catalysts building up over the past few months - including lower commodity prices, a stable rupee, a favorable winter wheat crop and the government?s commitment to fiscal consolidation - the RBI instituted a rare inter-meeting rate cut.

2015-01-26 The Greek Elections: A Gordian Knot? by Dimitri Balatsos of Tesseract Partners

The upcoming Greek elections on Sunday, January 25 have whipped political and economic pundits into a frenzy. At the heart of the excitement is a possible win by Syriza, the left-leaning political party. This relative new comer on the political stage has promised a slew of populist programs, which include doing away with fiscal austerity, rolling back reforms, and renegotiating bailout terms with the country?s creditors.

2015-01-25 No Need to Fear Low Oil Prices by Russ Koesterich of BlackRock

Oil markets are starting 2015 in a very different position than a year ago. It may be time to review your portfolio as cheaper oil may change the investment landscape and become the new reality.

2015-01-25 There?s More to the Gold Rally than European Market Fears by Frank Holmes of U.S. Global Investors

Even though gold was down last year, it still ranked as the second-best-performing currency, following the U.S. dollar. The metal has risen about 10 percent year-to-date, and on Tuesday, for the first time since mid-August, it broke through the $1,300 mark.

2015-01-25 Equity Investment Outlook: More of the Same by Team of Osterweis Capital Management

We are of the view that the conditions for further gains in the bull market that began in early 2009 are still intact and that the conditions for a true bear market are not. The market could, of course, be subject to corrections ? it always is ? but we believe the trend is still upward.

2015-01-25 Fixed Income Investment Outlook: 2014 is Over. Long Live 2014! by Team of Osterweis Capital Management

We believe that at current yields there is no investment grade ?fat pitch? at this time. Our focus remains on keeping duration short and layering-in higher yielding paper, especially on sharp corrections in markets like we have seen recently. We believe that the appropriate time to take a swing at investment grade bonds will be when yields are much higher and the economy is teetering towards recession.

2015-01-25 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The ECB Faces Fact; United States: Federal Budget Check-Up; Are Risk Management Techniques Adding to Market Risk?

2015-01-25 Decoding The ECB?S QE Paradox by Jeffrey Rosenberg of BlackRock

The ECB?s launch of its one trillion euro rescue plan this week has implications for investors everywhere. Jeffrey Rosenberg dissects two critical comments Mario Draghi made after the announcement.

2015-01-25 A Market Forecast We Can Believe In by Robert Isbitts and Vincent Esposito of Sungarden Investment Research

When Leuthold makes a major forecast, we pay close attention. And in their January Green Book, they said they see the U.S. stock market beginning a ?topping process? which started last July. They believe that this will ultimately take U.S. stocks down by 25-30% in either 2015 or 2016. Leuthold points to symptoms such as a weak high yield bond market, lagging relative performance of the NYSE Composite Index (which was the focus of our 11/28/14 blog), and very bullish newsletter writers.

2015-01-25 Is Your China Glass Half Empty or Half Full? by Andy Rothman of Matthews Asia

It's been well-noted that China's 2014 GDP growth was the slowest in 24 years. But following 7.7% growth for the prior two years, 7.4% doesn't feel like a huge slump. And because the base was so much bigger, the incremental increase in the size of China's economy last year was 100% bigger than the increase at a much faster growth rate a decade ago. What are other important perspectives on China these days? Andy Rothman, Matthews Asia Investment Strategist, explores in this issue of Sinology.

2015-01-25 Obama?s Proposed Tax Hikes: Just an Opening Bid by Tara Thompson Popernik of AllianceBernstein

Over the holiday weekend and in last night?s State of the Union address, President Obama unveiled several ideas he believes will strengthen the country?s workforce, education and infrastructure. He plans to pay for these proposals through corporate tax reform and higher income taxes on people in the top tax bracket.

2015-01-25 Connecting to China?s New Equity Plays by Stuart Rae and John Lin of AllianceBernstein

Despite a slow start following its launch in November, the Shanghai-Hong Kong Stock Connect share trading scheme has significantly increased foreign access to China equities and created new investment opportunities. Two subsectors are particularly noteworthy for global investors.

2015-01-25 Weekly Market Summary by Urban Carmel of The Fat Pitch

It's safe to say that US indices have been acting very differently over the past two months than they have at any other time in the past 3 years. This oscillating pattern of sharp falls and rebounds suggests equities are searching for direction. In the past 5 years, this has been a prelude to a change in trend.

2015-01-25 Weighing the Week Ahead: Time to Focus on Europe? by Jeff Miller of New Arc Investments

This week?s potential themes all defy prediction. I do not know what will happen in Greece. I question the preliminary analysis of the ECB moves. The earnings stories have been a bit better than market forecasts, but with little reaction.

2015-01-23 Obama tax proposal by Andy Friedman of The Washington Update

In conjunction with his State of the Union address, President Obama proposed new taxes on the wealthy to raise $320 billion in revenue, to be spent on new government programs to help the middle class and working families.

2015-01-23 Despite Hitting an Oil Slick, Evidence Underpins a Positive Outlook on MLPs by David Chiaro of Eagle Global Advisors

The fall in energy prices has raised concerns that the dramatic hydrocarbon volume growth we have seen from the new shale plays in the U.S. in the past few years is over or might even reverse. We believe these concerns are overblown. We think the current dislocation in the commodity markets is a case of supply temporarily getting ahead of demand.

2015-01-23 3 Things - The Fed, Rig Counts And Employment, ECB by Lance Roberts of Streettalk Live

Yesterday, I wrote a fairly lengthy discussion on the biggest fear of the Fed is deflation. As I stated: "The biggest worry of the Federal Reserve, and frankly every Central Banker on the planet, is deflation. The reason is that deflation, as an economic pressure, is dangerous and once entrenched becomes difficult to break."

2015-01-23 U.S. Lodging: The Recovery Checks In for an Extended Stay by Ray Huang, Amit Arora of PIMCO

Relatively high occupancy levels should drive room rate growth in the hotel sector over the next several years, despite some supply entering the market. We see opportunities in certain segments, such as premium hotels and C-corporations, due to high barriers to entry and pricing power.

2015-01-23 Shock Therapy: Volatility Spells Opportunity by Pamela Rosenau of HighTower Advisors

Over the past six months, the world has seen the price of crude oil decline by over 50%. Other commodities such as copper, gold and iron ore have also suffered declines, as demand from emerging markets has weakened. The supply/demand imbalance has created some uncertainty as to where commodity prices will eventually settle, and the sharp price moves have contributed to some of the volatility in financial markets.

2015-01-23 Winter Quarterly Commentary by Team of Knightsbridge Asset Management

Last year, Legos hit the big screen. In ?The LEGO Movie?, as those of you with children are more likely to be aware, a Lego mini-figure named Emmet Brickowski and his allies save the universe from the clutches of the evil Lord Business. Victory in hand, our Lego friends then party, to the tune ?Everything is Awesome?. And indeed, here too in our more mundane real world...everything is awesome!

2015-01-23 ECB Review: Blowing on the Embers of a Reflationary Fire by Andrew Bosomworth of PIMCO

?Not to pursue our mandate would be illegal? is how Mario Draghi ended his last press conference of 2014. Mr. Draghi?s first press conference of 2015 began with the announcement of a quantitative easing (QE) programme that pursues the European Central Bank?s (ECB) inflation mandate with a vengeance. And rightly so, for the disinflationary trends in the eurozone had become all the more precarious as economic output and the price of oil continued to fall.

2015-01-23 High Yield Bonds versus Equities by Heather Rupp of AdvisorShares

Investors are often led down the path that they must invest in equities in order to generate a decent return, and that the high yield market is too risky and speculative. However, reality and the data points suggest otherwise. Looking over the past couple decades and various periods in between, you can see that high yield has outperformed the equity market (as measured by the S&P 500 Index) on a risk adjusted basis (return/risk) over the past 5, 10, 15 and 25 years, and performed equivalently over the last 3 years.

2015-01-23 Tsunamis Most Often Come Without Warning by John Browne of Euro Pacific Capital

On Thursday, January 15th, the Swiss National Bank (SNB) discontinued its three year effort to maintain its minimum currency floor of the Swiss franc. In a single day the move sent the Swiss Franc (SWF) climbing a massive 21% against the U.S. dollar and 41% against the euro. The move sent shockwaves of unprecedented ferocity through the massive foreign exchange (FX) market, which is by far the largest, and most highly levered, trading market in the world.

2015-01-23 Quarterly Review and Outlook by Van Hoisington, Lacy Hunt of Hoisington Investment Management

Commodity price declines were the symptom of sharply deteriorating economic conditions prior to the 1920-21 depression. To be sure, today?s economic environment is different. The world economies are not emerging from a destructive war, nor are we on the gold standard, and U.S. employment is no longer centered in agriculture and factories (over 50% in the U.S. in 1920). The fact remains, however, that global commodity prices are in noticeable retreat.

2015-01-23 Conference Board Leading Economic Index: About Those Benchmark Revisions by Doug Short (Article)

Today's release of the December Conference Board's Leading Economic Index included benchmark revisions in addition to the routine monthly revisions. Also the base year for the index was changed from 2004=100 to 2010=100. Today's press release included the following comment:

2015-01-22 Wait and See at the Bank of England by Mike Amey of PIMCO

UK growth looks to be sustainable, with encouraging domestic demand, though we need to see business investment continue to pick up. Although inflation hovering below the 1% lower tolerance band of the Bank of England (BOE) remains a concern, we think it actually gives the central bank welcome breathing room during a period of uncertainty for the global economy. Looking ahead, we see compelling investment value in the intermediate part of the UK yield curve, namely five- to 10-year bonds, as the BOE plays the waiting game.

2015-01-22 Deflation Is A Problem For The Fed by Lance Roberts of Streettalk Live

The biggest worry of the Federal Reserve, and frankly every Central Banker on the planet, is deflation. The reason is that deflation, as an economic pressure, is dangerous and once entrenched becomes difficult to break. For the Fed, the fear of inflation is far less worrisome.

2015-01-22 Deflation, Low Inflation, and Monetary Policy by Scott Brown of Raymond James

Central bank policymakers fear deflation more than anything. However, there is good deflation and there is bad deflation. Yet, even low inflation can create problems for an economy. Low inflation is expected to be a key factor in the ECB?s decision to embark on quantitative easing and ought to have some influence on the timing of the Fed?s initial rate hike.

2015-01-22 Rocky Horror Picture Show by Jeffrey Saut of Raymond James

?Rocky Horror Picture Show? was a satirical film production done as a tribute to the science and horror ?B? movies of the late 1930s through the 1970s. I was reminded of the flick last week when one portfolio manager I saw in Fort Lauderdale said to me, ?The first few weeks of the New Year have been an absolute horror show!?

2015-01-22 How U.S. Stocks Lost Their Lead by Russ Koesterich of BlackRock

High expectations and valuations are making U.S. stocks more vulnerable to disappointments against a slowing world economy. It?s a good time to make sure your portfolio is truly international.

2015-01-22 Will Millennials Drive in 2-0-1-5? by William Smead of Smead Capital Management

It is our opinion that the most important question in stock picking is one related to the Millennial group. Will they drive the U.S. Economy in 2015 through 2020 and in the process greatly impact the long-term profitability of the businesses which benefit the most from their emergence?

2015-01-22 Fixed Income in 2015: Lower for Longer? by Jonathan Heckscher of Pennsylvania Trust

2014 surprised many bond investors as interest rates fell dramatically on the longer end while they rose as expected on the short end. The result was another solid year of returns for investors that remained in longer-duration bonds, and was adequate for most investors that shortened their duration.

2015-01-22 A few words on Europe by Tim Stevenson (Article)

Tim Stevenson, Director of Pan European Equities, comments on the recent revaluation of the Swiss Franc, political uncertainty and the ECB’s actions in terms of monetary easing. He also notes the recent outperformance of European markets and provides his near term expectations.

2015-01-22 Oil Impact Featuring David Grumhaus, Jr. by (Article)

Pressure on oil prices doesn’t necessarily affect the attractiveness of MLPs, says David Grumhaus, Jr., of Duff & Phelps Investment Management

2015-01-22 Interest Rates, Will They Rise In 2015? by (Article)

Interest rates set by the Fed are expected to rise, but timing remains uncertain – as does potential impact, says Mike Taggart of Nuveen Investments.

2015-01-21 Buy the Rumor, Sell the News by Scott Minerd of Guggenheim Partners

Economic strength in the U.S. and the announcement of QE in Europe could spell the end of the recent bond rally.

2015-01-21 Oversold Market Poised to Rebound by Gene Peroni of Advisors Asset Management

The distinction between ?bear market? and ?interruption? is important in understanding and assessing the ultimate upside potential of this cycle. The DJIA had a terrific advance between October 2002 and 2007 of nearly 100%, but when the advance resumed in March 2009 with much of the market?s longer term sector leadership still intact, it soon became apparent that the financial debacle had presented only an interruption of the bullish cycle that began in 2002.

2015-01-21 Swiss Franc's Surge = Chaos In Global Currency Markets by Gary Halbert of Halbert Wealth Management

Last Thursday, the Swiss National Bank stunned the financial world by decoupling the Swiss franc from the euro. This surprise move sent the franc up almost 40% against the euro in one day, although it didn?t close that high (up 19%). Nevertheless, many currency traders, banks and brokerages were left with devastating losses.

2015-01-21 IBM: When a Company Veers Off the Roadmap by Nate Palmer of Diamond Hill Capital Management, Inc.

In 2010, International Business Machines? (IBM) then-CEO Sam Palmisano unveiled the company?s 2015 Roadmap in which management detailed its plans to grow (non-GAAP) operating earnings to ?at least $20? per share by 2015. This plan was the successor to a 2010 Roadmap, originally unveiled in 2007, in which management outlined its plan to deliver ?at least $10? in earnings per share by 2010. Since the company ultimately exceeded its 2010 Roadmap expectations and delivered $11.52 in 2010 earnings per share, the 2015 Roadmap was generally met with enthusiasm by

2015-01-21 Switzerland Wins As Its Central Bank Surrenders by Peter Schiff of Euro Pacific Capital

If anyone had any doubt how severely the global economy has been distorted by the actions of central bankers, the "surprise" announcement last week by the Swiss National Bank (SNB) to no longer peg the Swiss franc to the euro should provide a moment of crystal clarity.

2015-01-21 What We Are Hearing From Asia-Pacific Investors: Five Themes for 2015 by Eric Mogelof of PIMCO

Amid lower forward-looking returns, investors are focusing on multi-asset solutions, enhanced beta, income and alternatives in Asia-Pacific. PIMCO is prepared to address these themes, drawing upon our time-tested investment process that combines high-level macroeconomic views with thorough on-the-ground research.

2015-01-21 Saudi Succession by Bill O'Grady of Confluence Investment Management

King Abdullah of Saudi Arabia was recently hospitalized with pneumonia. In light of his advanced age and declining health, an analysis of royal succession in Saudi Arabia is in order. We will begin with a history of Saudi kings and follow with an examination of the current Saudi succession, focusing on the Crown Prince and who remains as potential kings among the ?second generation? of the Saudi Royal Family. We will analyze the challenges facing the kingdom and how the succession issue will likely complicate the way these issues are resolved, and conclude with potential market ram

2015-01-21 Greece's Perilous Odyssey by Milton Ezrati of Lord Abbett

At best, the black sheep of the eurozone family is a troubling source of uncertainty for policymakers and global markets?at worst, it?s a potential disaster.

2015-01-21 European Head Fake? by Burt White of LPL Financial

The much anticipated European Central Bank (ECB) policy meeting this week may include a quantitative easing (QE) program announcement. Although we would view a potentially bold QE program from the ECB as an incremental positive, the ongoing growth and deflation challenges in Europe leave us still with a strong preference for the U.S.

2015-01-21 Investor implications of QE by the ECB by Axel Merk of Merk Investments

Is European Central Bank (ECB) head Draghi?s determination to purchase government bonds turning Europe into a banana republic? What are the implications not only for the euro and U.S. dollar, but gold, stocks and bonds? Our analysis shows that conventional wisdom may be proven wrong in more than one way.

2015-01-21 Tocqueville Gold Strategy Investor Letter: Year End 2014 by John Hathaway of Tocqueville Asset Management

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX), looks back at the performance of gold over 2014, noting that: "in dollar terms gold declined 1.7 percent, but?it posted solid gains against all other currencies," and that "the dollar?s strength relative to other currencies has camouflaged the strength of gold."

2015-01-20 Gundlach's Forecast for 2015 by Robert Huebscher (Article)

Despite a fragile economic recovery - now threatened by falling oil prices - and the likelihood that the Fed will raise short-term rates, the prospects for the U.S. bond market in 2015 are good, according to Jeffrey Gundlach.

2015-01-20 Retiring in a Low-Return Environment by David Blanchett, Michael Finke and Wade Pfau (Article)

Low bond yields and high equity valuations suggest lower spending for retirees. Prior research forecasted the impact on safe-withdrawal rates (SWRs), but a more sophisticated model can improve the accuracy of those predictions. We show just how low the SWRs should be for today's retirees.

2015-01-20 A Year-End Letter to Clients: How the World's Wealthiest Families Invest by Dan Richards (Article)

Here are the components of the year-end letter for 2014: An overview of 2014 performance; Some context on market valuations and how wealthy families are investing today; and brief thoughts for the period ahead.

2015-01-20 Albert Edwards - "Markets to Riot" by Robert Huebscher (Article)

Albert Edwards admits that his "bear" reputation is well deserved, at least with respect to equities, an asset class he has dismissed for the last 10 years. His bearishness has not abated, and for the coming year, he fears that "deflation will overwhelm the west." Markets, he said, will riot.

2015-01-20 The Small Investment that Pays a Big Return by Daniel Solin (Article)

Television anchors have discovered something that has eluded many financial advisors, both male and female.

2015-01-20 Venerated Voices by Various (Article)

Advisor Perspectives, a leading publisher serving financial advisors and the financial advisory community, has announced its Venerated Voices awards for articles published in 2014.

2015-01-20 Combating Depression in Your Firm by Beverly Flaxington (Article)

One of our most senior advisors has been suffering from depression and it is creating an increasing problem in our firm. Though there has been no official corporate communication, we all know it is going on and see the impacts.

2015-01-20 Are You Considering a Client Advisory Board? Here's What You Need To Know. by Teresa Riccobuono (Article)

As part of your 2015 marketing calendar, consider including a client-advisory board.

2015-01-20 The Swiss Release the Kraken! by John Mauldin of Mauldin Economics

In an era when central bankers are supposed to be more open, collaborative, and communicative, what would make the Swiss National Bank decide to turn on a dime and shock the markets ? to release the Kraken, as it were? Note that in fact all hell did break loose. Rather than delivering hints accompanied by a few well-placed leaks, the Swiss decided it would be best to completely surprise the markets. It will be a long time before we get the full story on what must have been going through their heads as they reached the decision.

2015-01-20 5 Things To Ponder: A View Of A Correction by Lance Roberts of Streettalk Live

It has been a rough start to a new year as all of the gains following the end of the Federal Reserve's flagship "QE-3" campaign have been erased.

2015-01-20 Weekly Market Summary by Urban Carmel of The Fat Pitch

US equities have now fallen three weeks in a row. At its low on Friday, SPX was 5% off its high on December 29.

2015-01-20 Economic Update by Kevin Moloney of Bronfman E.L. Rothschild

The drop in energy prices dominates global headlines and the economic implications on a global scale are somewhat mixed, with major oil importers benefiting the most. Beyond energy, the backdrop for the U.S. economy continues to be strong, with a third quarter GDP estimate of 3.9% and a labor market that continues to plod along; although improvements are still needed. The strong close to 2014 is providing a robust tailwind for the domestic economy entering the New Year, whereas many countries overseas continue to cope with slower growth and potential deflation.

2015-01-20 The Politics of Economic Stupidity by Joseph Stiglitz of Project Syndicate

In 2014, the world economy remained stuck in the same rut that it has been in since emerging from the 2008 global financial crisis. But we know how to escape our current malaise, which suggests that the big problem facing the world in 2015 is political, not economic.

2015-01-20 Despite Escalating Volatility, U.S. Fundamentals Remain Sound by Robert Doll of Nuveen Asset Management

U.S. equities declined for a third straight week, with the S&P 500 Index dropping 1.2%. Defensive areas such as utilities and telecommunications were the best-performing sectors, while the financial sector was hit the hardest. Notwithstanding last week?s decision by the Swiss National Bank to remove its currency peg, the fundamental backdrop has not changed much in recent weeks. We attribute the fall in equity prices to ongoing worries about the collapse in oil prices and the ripple effect on the global financial system.

2015-01-20 Swiss Surprise: National Bank Ends Currency Cap by Rob Waldner, Nicholas Wall, Ray Uy of Invesco Blog

On Jan. 15, the Swiss National Bank (SNB) unexpectedly abandoned its policy to cap the value of the franc at 1.2 euros.1 Over the past few years, the SNB has had to sell billions of francs to buy euros to prevent an excessive appreciation of the domestic currency - a too-strong currency could dent the country?s export business.

2015-01-20 Navigating the Oil Slick by Team of Calamos Investments

GDP growth for 2015 is likely to be 2.0%-2.5% globally and 2.5%-3.0% in the U.S. Oil prices may fall further but are likely to stabilize over the next several months. The ECB is likely to ramp up QE in the first quarter. These next months are likely to be volatile, but equities have more room to run. Low corporate borrowing costs and high dividend yields should encourage continued M&A and buyback activity, providing support to equity valuations. With the U.S. in the middle innings of the recovery, the case for secular and cyclical growth companies remains strong.

2015-01-20 Davos - And the Euro by Brian Wesbury, Robert Stein of First Trust Advisors

Perfect! Last week, the Swiss National Bank in reaction to market pressure, ended its crawling peg against the euro. The Swiss Franc surged 40% versus the euro, before settling around 20% higher, and roughly 17% against the already strong dollar. So, guess what? Attendees at The World Economic Forum ? an annual gaggle of the global financial elite held in Davos, Switzerland, which starts today ? just saw their trip get a lot more expensive.

2015-01-20 What is a Deep Value Investor? by (Article)

Deep value investors have a long-term focus and are not fixated on quarterly earnings. They're looking for companies with the ability to compound wealth over time.

2015-01-20 Seeking Strong Int'l Growth Stocks Amid Mixed Macro Signals by Sponsored Content from Invesco (Article)

Previously stretched valuations have become reasonably constructive in Europe's stalled economy. China's structural reforms and corruption crackdown could be positive in the long term. The commodity cycle downturn hurts resource-dependent emerging markets but benefits net commodity importers.

2015-01-18 QE and the ECB: "Authorize" is a Slippery Word by John Hussman of Hussman Funds

The ECB will authorize a large QE program this week, but my impression is that the details will leave the ECB itself responsible for executing only a fraction of the announced program, with the remaining majority of the program (perhaps 60-75%) being nothing more than the option for each national central bank to purchase its own country?s government bonds, at its own discretion, and its own risk. Moreover, that option is likely to be limited to something on the order of 25% of the outstanding government debt of each respective country.

2015-01-18 Weighing the Week Ahead: The Message from Fourth Quarter Earnings by Jeff Miller of New Arc Investments

I do not know how earnings season will play out this week. My list of things to watch is good, but the market seems to be demanding a parlay of positive indications: Beating the whisper number for earnings; Beating the revenue expectations; Business growth ?organic, not from mergers or purchases; Solid ?quality of earnings? with no gimmicks or accounting moves; A credible, positive outlook.

2015-01-17 Clock Will Be Ticking for Greece?s New Government by Darren Williams and Dennis Shen of AllianceBernstein

Greece is holding early parliamentary elections on January 25. A victory for the anti-austerity Syriza party would probably trigger tense negotiations with the country?s official lenders and fresh volatility in Greek government bond markets. But the expected launch of ECB QE should mitigate contagion to the rest of the periphery.

2015-01-17 Looking Ahead: What the ECB Might Do by Russ Koesterich of BlackRock

The next European Central Bank policy setting meeting could bring about a new quantitative easing program. Would it be able to keep the eurozone from falling into a deflationary trap?

2015-01-17 Palladium Was the Winner in 2014 by Frank Holmes of U.S. Global Investors

Palladium, 2014?s top commodity, performed relatively according to script. For the year it was up 11.35 percent, compared to its 10-year annualized returns of 14 percent. Much like nickel, palladium was spurred by extenuating circumstances. Between January and June, a labor strike in South Africa, the world?s second-largest producer of the metal following Russia, halted production, which depleted reserves and sent palladium to a three-year high of $850 an ounce.

2015-01-17 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

?Francogeddon? ? ?tsunami? ? ?carnage? ? The hyperbole after the Swiss National Bank (SNB) unexpectedly ended its three-year currency ceiling peg to the euro yesterday was not misplaced. The immediate impact has been profound across a range of markets. The longer-time ripples are only beginning to become apparent. This is what we?ve gleaned so far:

2015-01-17 Oil Prices... A Metaphor for an Investment Process by Robert Isbitts of Sungarden Investment Research

Energy is an essential part of the global economy. There are companies that drill for oil or natural gas, those that process and refine it into products and others that transport and sell those products (e.g. gas stations). These businesses are all impacted by the price, supply and demand environment surrounding energy. Lately, they have nearly all been losing investments.

2015-01-17 Occupy Wall Street in Qing Dynasty, China by Gerald Hwang of Matthews Asia

What if a banker's family could be taken as slaves to repay losses arising from the banker's malfeasance? This may seem extreme now but it was part of a system that existed 200 years ago in a China's desolate Shanxi region near Mongolia. This week, Gerald Hwang, CFA, writes about this surprising birthplace for a banking system that served elite citizens and the treasury of the Qing dynasty.

2015-01-17 For US Economy, 2015 May Be a Very Good Year by Joseph G. Carson of AllianceBernstein

The US economy shifted into a higher gear in 2014 as growth over the last three quarters averaged 4.5%. With consumer, business and even government spending set to rise, the outlook for 2015 is even brighter?and that should be enough to convince the Federal Reserve to start lifting interest rates.

2015-01-17 What Did We Learn About Bonds in 2014? by Douglas J. Peebles of AllianceBernstein

After a less-than-stellar 2013 for bonds, many investors were ready to turn their backs on the asset class. But many didn?t?and were rewarded for their long-term perspective.

2015-01-16 Population-Adjusted Real Retail Sales: Another Perspective on the Economy by Doug Short (Article)

In real, population-adjusted terms, Retail Sales are at the level we first reached in December 2004.

Earlier this week, the Advance Retail Sales Report showed that sales in December declined 0.9% month-over-month, as I reported in my real-time update.

With the subsequent release of the Consumer Price Index, we can now dig a bit deeper into the "real" data, adjusted for inflation and against the backdrop of our growing population.

2015-01-16 3 Things - Employment, Interest Rates & Retail Sales by Lance Roberts of Streettalk Live

There has been much discussion as of late about the "longest string of employment gains since the 90's." There is certainly no argument that employment has improved since the financial crisis, however, with the economy six years into a recovery we should certainly expect as much.

2015-01-16 QQE2: Japan?s Monetary Banzai Charge by Chris Richey of Neosho Capital

In this Age of Monetary Policy, it is impossible to ignore the macro. As much as we would like to focus only on individual enterprises, the mind-boggling scale of $5 trillion of monetary intervention in the U.S., Japan, and Europe renders such cloistered thinking imprudent. Not only must Benjamin Graham?s enterprising investor understand individual stocks, but they must also be keenly cognizant of the role the world?s largest central banks actively play in the value of currencies, bonds, stocks, ETFs, mutual funds, and derivatives of all kinds.

2015-01-16 Yesterday?s Gone: Year-End Capital Markets Commentary and Expectations by Chris Brightman, Jim Masturzo of Research Affiliates

With updated return expectations, we estimate that the performance of U.S. stocks and bonds over the next 10 years will be significantly lower than long-term historical averages. Other asset classes may produce moderately better returns.

2015-01-16 Market Overview Q414: Using Knowledge as a Yardstick by David Robertson of Arete Asset Management

Simply following the Fed?s lead of investing in risk markets may seem overly simplistic and ultimately ill-advised. Indeed by assessing the economy by the standard of knowledge, we can see the Fed?s policy of low rates is actually counter-productive.

2015-01-16 The Year Ahead by Jack Rivkin of Altegris

It is once again time to put down in print in one place some pretty specific speculations on what could happen next year. We do this every year with the intent of trying to get investors to think about what could happen and factor that into their decisions on how to adjust their portfolios to take advantage of opportunities while at the same time being aware of the risks.

2015-01-16 Managed Futures, Quantitative Easing and Volatility by Jack Rivkin of Altegris

Mark Melin, writing for ValueWalk, picked out some of the points in our Altegris Perspectives piece, ?What to Expect in 2015??. Mark asked some questions expanding on topics scattered throughout the piece, specifically relating to Managed Futures and the persistence of dispersion; Quantitative Easing (QE) and the lack of continuing discussion about it; and Volatility and its impact on relative values.

2015-01-16 The Swiss National Bank?s Unpleasant Experience of Sleeping Next to an Elephant by Sachin Gupta, Thomas Kressin of PIMCO

On 15 January 2015, the Governing Board of the Swiss National Bank (SNB) unexpectedly exited its minimum exchange rate regime, which it had adopted back in September 2011 when it was fighting sharp appreciation of the Swiss franc in the midst of the eurozone sovereign debt crisis.

2015-01-16 2015 Economic & Capital Market Outlook by Gregory Hahn of Winthrop Capital Management

The domestic economy is growing at 3.0% to 3.5% pace. The budget deficit is plummeting and currently is less than 2.8% of GDP. The price of oil is in a freefall now below $55 per barrel and inflation is virtually nonexistent. The rate of unemployment is below 6.0%. These are idyllic conditions for any economy, especially five years after the largest financial crisis since the Great Depression. So, what?s the problem?

2015-01-16 Dow 20,000: Is 2015 the Year by Adam Butler, Mike Philbrick, Rodrigo Gordillo of Butler|Philbrick|Gordillo & Associates

It?s that time of year again. Yup, that jolly, happy time of year when the soothsayers of Wall Street start trumpeting their views on what?s going to happen in 2015, and how to position portfolios to profit. Esteemed Wharton professor, Jeremy Siegel, author of the permabull bible, Stocks for the Long Run, recently joined the merry parade with his own forecast that Dow 20,000 ?could happen? in 2015. Astute investors might take stakes now in large manufacturers of confetti, party horns, and streamers.

2015-01-15 5 Charts For Fully Invested Bears by Lance Roberts of Streettalk Live

While the mainstream media continues to misalign individuals expectations by chastising them for "not beating the market," which is actually impossible to do, the job of a portfolio manager is to participate in the markets with a predilection toward capital preservation. It is the destruction of capital during market declines that have the greatest impact on long-term portfolio performance.

2015-01-15 A New Ceiling for Oil Prices by Anatole Kaletsky of Project Syndicate

Most analysts still view $50 as a floor for the price of oil ? or even a springboard. But, though the futures market suggests expectations of a fairly quick rebound to $70 or $80, economics and history suggest that today?s price should be viewed as a probable ceiling for a much lower trading range.

2015-01-15 Seizing Credit Opportunities When Oil Prices Are Sliding by Mark Kiesel, David Linton of PIMCO

?We believe we are moving into an extended period of lower oil prices, and we are actively managing our clients? energy exposure with an eye toward benefiting from recent events. Differentiation between the winners and losers across countries, sectors and individual companies is essential. We currently favor subsectors and companies with strong asset quality, high barriers to entry, solid production profiles and strong balance sheets and liquidity profiles.

2015-01-15 The Long Growth Drag From Financial Market Tinkering? by William De Leon of PIMCO

Central bankers and regulators have greatly underestimated the negative impact their actions may have on the economic ?multiplier.? Over the next two to three years this miscalculation may settle into a permanent drag on global growth. Forget fears of bloated central bank balance sheets and their potentially inflationary effects ? rather than generating credit in the consumer sector, much of that ?liquidity? is being used to meet new capital requirements.

2015-01-15 Bracing for Stagnation by Raghuram Rajan of Project Syndicate

As 2015 begins, the global economy remains weak. With few signs that this year will bring any improvement, policymakers would be wise to understand the factors underlying the global economy?s anemic performance and the implications of continued feebleness.

2015-01-15 Outlook 2015: Global Equities by Alex Tedder of Schroders Investment Management

We see 2015 as being characterized by an ongoing divergence in global growth and monetary policy that will create attractive pockets of investment opportunity for stockpickers.

2015-01-15 What Good Are Economists? by Robert Shiller of Project Syndicate

Since the global financial crisis and recession of 2007-2009, criticism of the economics profession has intensified. If economists were unable to foresee something so important to people?s wellbeing, what good are they to society?

2015-01-15 Is the Euro the New Yen? Increasingly So by Jeremy Schwartz of WisdomTree

There is recent evidence that Europe is becoming more Japan-like in displaying negative correlations between its equity markets and its currency moves. This negative correlation in Europe is not a new phenomenon.

2015-01-14 Census Bureau Revisions to Retail Sales by Doug Short (Article)

Earlier today I posted my monthly update on Retail Sales. Those of us who routinely track this series know that the Advance Estimate will be followed by a second estimate next month and a third estimate the month after. How big are those revisions? Are they big enough to warrant skepticism about the Advance Estimate?

See for yourself. Here is a visualization of the cumulative change from the first to third estimates from January 2007 through October 2014, the most recent month for which we have all three data points.

2015-01-14 The Job Market and the Fed by Scott Brown of Raymond James

The December Employment Report presented a mixed job market picture. The establishment survey data reflected strong job growth, but with a lackluster trend in average hourly earnings. The household survey showed a larger-than-expected drop in the unemployment rate, but that was due to a decline in labor force participation. What should Fed policymakers make of this report? Patience, grasshopper, patience ...

2015-01-14 Is the Party Over? by Jerry Wagner of Flexible Plan Investments

Every year it seems to be the same. January arrives and with it the winter blahs set in. The excitement of Christmas Day has passed. The celebration of New Year?s is but a memory. We?re putting away all the holiday decorations. What a pain (literally)! And, forgive me for a parochial slip; the Lions, once again, are out of the football playoff picture and off TV.

2015-01-14 Are Macroeconomists Rebuilding a Wall of Worry? by William Smead of Smead Capital Management

Those of you who follow us at Smead Capital Management know that we believe in the idea that good markets die on too much affection and continue due to a lack of affection. You also know that we want to own wonderful companies for a long time and do so through regular stock market corrections/bear markets over the years. Since the stock market bottom in March of 2009, this secular bull market has climbed on a wall of worry and on a lack of optimism.

2015-01-14 The Bright Side of Cheap Oil by Burt White of LPL Financial

Earnings season is here and, as we wrote in our earnings preview last week (?A Tale of Two Earnings Seasons?), low oil prices and the energy sector will be the market?s main focus.

2015-01-14 Is The US Treasury Market Rigged? Some Say Yes by Gary Halbert of Halbert Wealth Management

The last time federal regulators took a hard look at how Wall Street banks and brokers trade US Treasury securities ? the largest bond market on the planet by a longshot ? a little company called Google Inc. was just starting out.

2015-01-14 Barron?s Makes The Case For Active Management by Roger Nusbaum of AdvisorShares

The Barron?s cover story made the case for active management outperforming passive indexing when interest rates rise citing the history that supports the notion from past periods of rising rates with the underlying logic being that ?rising rates go hand-in-hand with outperformance of smaller stocks, which active managers tend to favor? as well as part of active management including what to avoid which is a concept we have discussed here many times before.

2015-01-14 Don?t Bet on a Stronger Dollar by Barry Eichengreen of Project Syndicate

Economic pundits, almost without exception, are predicting a stronger dollar in 2015 ? an expectation that is leading investors to place some very large bets. But that market strategy could turn out to be a very large mistake.

2015-01-14 Avoiding Value Traps and Aggressive Growth by (Article)

Portfolio Manager Jim Stoeffel talks about his investment criteria, what he looks for in management teams, how he tries to avoid value traps, and Royce’s approach to building conviction.

2015-01-14 Bond CEFs Featuring Robert Shaker by (Article)

Bond-focused closed-end funds may help your portfolio even in rising rate environments, says Robert Shaker of Shaker Financial Services.

2015-01-14 2015 Outlook Featuring Mike Taggart by (Article)

Senior loan closed-end funds may present an opportunity to investors in 2015, says Mike Taggart of Nuveen Investments.

2015-01-14 2014 Review Featuring Mike Taggart by (Article)

US equity and long-duration municipal bond sectors fared well in 2014, while senior loans and MLPs disappointed, says Mike Taggart of Nuveen Investments.

2015-01-13 The Advantages of a Dynamic Retirement Income Strategy by Joe Tomlinson (Article)

Retirees will adjust their spending depending on investment experience. But most research uses withdrawal strategies that are fixed at inception, such as the 4% rule. I'll show that when spending can adjust each year, retirement outcomes will improve. I'll also show the gains that can be achieved by adding annuities.

2015-01-13 Estimating the Impact of Oil Prices and Interest Rates on the S&P 500 by Eric Stubbs (Article)

Two important developments in 2014 will affect U.S. equity markets in 2015: the precipitous decline in oil prices and increasing expectations that the Fed will begin raising short-term rates sooner rather than later. But how specifically will these affect our stock market? I report on the results of an econometric model that I developed to address these questions.

2015-01-13 Is the Commercial Office Market Recovery a Mirage? by Keith Jurow (Article)

I will focus on an important question few analysts are raising: Is the so-called recovery in commercial office markets real or a mirage?

2015-01-13 The Small Decisions that Lost a $5 Million Account by Dan Richards (Article)

A recent conversation with a woman looking to invest an inheritance highlighted how seemingly trivial decisions by advisors can make a huge difference. In this case, the advisor's inattention to a small detail cost a $5 million account.

2015-01-13 An Introvert's Guide to Gathering AUM by Daniel Solin (Article)

Here's how introverts can turn what may seem like a weakness into a significant advantage.

2015-01-13 The Best Way to Communicate New Investment Approaches by Beverly Flaxington (Article)

We recently changed our investment approach. As senior management, we decided against broad messaging because we believed it would cause more consternation on the part of our clients. Some of our advisors think this is disingenuous. Do you agree with our decision or should we be telling our clients exactly what we are doing and why?

2015-01-13 Women: Overlooked, Disenfranchised and High-Value by Jack Singer, Ph.D. (Article)

Women are earning more, inheriting more and controlling more wealth than ever before. This is a huge, untapped demographic cohort awaiting every financial advisor who understands some key points about women's needs and desires.

2015-01-13 "Divergent" Markets by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

We expressed some concern about financial markets in last quarter's client letter and stated the theme of the letter was volatility. That characteristic carried over into the fourth quarter and caused our concern to heighten considerably.

2015-01-13 Volatility and Uncertainty in the Energy Market by Kathleen Gaffney of Eaton Vance

What?s causing the decline in oil prices? Kathleen Gaffney, co-director of investment-grade fixed income weighs in.

2015-01-13 European Populism by Bill O'Grady of Confluence Investment Management

In our 2015 Geopolitical Outlook, one of the risks we discussed was the rise of populism. In this week?s report, we will focus on European populism. The recent attack on the employees of Charlie Hebdo in France makes this a timely topic. In this report, we will define populism, examine why populism has developed in the West, note the particular characteristics of European populism and identify the effects it could have on general geopolitics in the future. As always, we will conclude with potential market ramifications.

2015-01-13 The 2015 State Of The Union by Lance Roberts of Streettalk Live

It is that time of the year when the President of the United States delivers his annual "State Of The Union" address. Over the weekend, the Associated Press discussed President Obama's retooled message.

2015-01-13 Central Banks' Power Shortage by Milton Ezrati of Lord Abbett

The Federal Reserve and the European Central Bank face significant limitations on what they can do to solve economic problems.

2015-01-13 2015 - Fasten Your Seat Belts, This Could Be a Bumpy Ride by Chris Puplava of PFS Group

While higher stock prices are often cited as the biggest beneficiary of the Fed?s several rounds of quantitative easing (QE), a lesser cited beneficiary has been overall market volatility and the credit markets. With each round of QE and/or ?Operation Twist? we?ve seen measures of financial stress in the credit markets contract.

2015-01-13 What Does the Oil Turmoil Mean for the Energy Sector in the Long Term by Tripp Zimmerman of WisdomTree

One of the largest investment stories for the second half of 2014 was the precipitous decline of oil prices and its impact on the energy sector. As a result of the sharp price declines, the dividend yields on various energy stocks have increased.

2015-01-13 Market Outlook 2015: Double Digit Gain...Thank You, May I Have Another? by K. Sean Clark of Clark Capital Management Group

The U.S. stock market finds itself in rare territory as we enter 2015. For only the sixth time in the past 150 years, the U.S. stock market has registered a double-digit gain for three consecutive calendar years from 2012 to 2014. We will try to answer the question: ?Can the U.S. stock market post a fourth year of double-digit gains??

2015-01-13 High-Yield and Bank Loan Outlook by Team of Guggenheim Partners

Investment-grade and high-yield spreads widen as energy plunges.

2015-01-13 What Are We Betting On? by Mohamed El-Erian of Project Syndicate

The world has collectively placed a huge bet on three fundamental outcomes: a shift toward more inclusive global growth, the avoidance of policy mistakes, and the prevention of market accidents. But all three developments are highly uncertain ? and bets on them are exceedingly risky.

2015-01-12 Investing During Turbulent Markets by (Article)

Portfolio Manager Chris Flynn explains why volatility plays such an important role in our investment process.

2015-01-12 Equity Market Surprise in 2015? by (Article)

45-year industry veteran Thomas S. White, Jr. reveals what he feels will surprise investors in 2015.

2015-01-12 Making Sense of Unconstrained Bond Funds by (Article)

In the latest video in Envestnet | PMC's Spotlight series, Senior Investment Analyst Nathan Behan, CFA, CAIA examines non-traditional and unconstrained bond funds.

2015-01-12 Tracking the Market with Social Media by Blair Jensen of Trade Followers

The Trade Followers Momentum indicator for the S&P 500 Index (SPX) continues to show chasing by market participants. Traders are jumping quickly from one side of the market to the other as price moves in large daily swings. The chasing increases instability because traders are not committed to positions. This shows up as Twitter and StockTwits 7 day momentum painting a pattern that mirrors price. This indicator is suggesting caution is warranted.

2015-01-12 Rethinking Europe?s Deflation Dilemma by Darren Williams of AllianceBernstein

December?s negative inflation print has led to a cacophony of headlines proclaiming that the euro area has finally succumbed to deflation. We think concerns about modest declines in consumer prices are overdone. But the structural weakness of nominal growth remains a major concern.

2015-01-12 Global Economic Overview: November 2014 by Team of Thomas White International

Lower energy prices continued to brighten the global economic growth outlook, though some of the recent data trends have been less cheerful. Crude oil prices have slipped to their lowest level since 2010, and the steep fall has the potential to significantly alter global growth patterns next year.

2015-01-12 International Equity Commentary: November 2014 by Team of Thomas White International

International equity prices saw modest gains during the month of November, helped by hopes of additional quantitative stimulus measures from the European Central Bank (ECB) as well as more robust U.S. economic data.

2015-01-12 Emerging Markets Equity Commentary: November 2014 by Team of Thomas White International

Emerging market equity prices saw a moderate correction during the month as markets in Latin America and Europe slipped. Countries where exports are dominated by energy and commodities saw the worst declines as oil prices continued to tumble.

2015-01-12 Europe at War by George Soros of Project Syndicate

Assisting Ukraine to defend itself against Russian aggression would have a stimulative effect not only on Ukraine, but also on Europe. That is why the EU ought to be even more committed to helping Ukraine than it is to imposing sanctions on Russia.

2015-01-12 Supply Shock and Awe by Scott Minerd of Guggenheim Partners

If the mid-80s? supply-driven oil crisis is a guide, we should expect further declines and a prolonged period where oil prices remain depressed.

2015-01-12 Bullish, For the Right Reasons by Brian Wesbury, Robert Stein of First Trust Advisors

Last week, we forecast the S&P 500 will hit 2,375 at the end of this year (link), so we?re obviously bullish on stocks. Our case is based on fundamentals, specifically, the long-term link between stocks, earnings, interest rates, and the economy as a whole. However, just because we?re bullish, doesn?t mean we agree with every bullish argument that?s out there.

2015-01-12 Markets May Be Choppy, but Equities Should Advance in 2015 by Robert Doll of Nuveen Asset Management

The year started off with equity markets experiencing volatile trading. Stock prices dropped sharply in the first few trading days before recovering, while oil prices plummeted and bond yields fell. Last week, U.S. equities lost ground and the S&P 500 Index declined 0.6%.

2015-01-12 A Five-Year Global Financial Forecast: Tsunami Warning by John Mauldin of Mauldin Economics

It is the time of the year for forecasts; but rather than do an annual forecast, which is as much a guessing game as anything else (and I am bad at guessing games), I?m going to do a five-year forecast to take us to the end of the decade, which I think may be useful for longer-term investors.

2015-01-11 Weighing the Week Ahead: A Message from the Bond Market? by Jeff Miller of New Arc Investments

There are many reasons for some to own bonds, but the extremely low interest rates suggest something beyond that. I suggest a leveraged arbitrage with Europe and Japan. Please note: This is basically the opposite of the 1998 carry trade.

2015-01-11 A Better Lesson than "This Time is Different" by John Hussman of Hussman Funds

The near-term outcome of speculative, overvalued markets is conditional on investor preferences toward risk-seeking or risk-aversion, and those preferences can be largely inferred from observable market internals and credit spreads. The difference between an overvalued market that becomes more overvalued, and an overvalued market that crashes, has little to do with the level of valuation and everything to do with investor risk preferences. Yet long-term investment outcomes remain chiefly defined by those valuations.

2015-01-10 Weekly Market Summary by Urban Carmel of The Fat Pitch

After hitting new all-time highs in the days after Christmas, US equities have now fallen two weeks in a row, an auspicious way to start the new year.

2015-01-10 Bad News Is Good News: A Contrarian View of China Investing by Frank Holmes of U.S. Global Investors

I asked Xian Liang, portfolio manager of our China Region Fund (USCOX), to outline a few of the most compelling cases to remain bullish on the Asian giant.

2015-01-10 Five Things To Ponder: What This Way Cometh by Lance Roberts of Streettalk Live

This week's reading list is a smattering of reads about 2015. As a contrarian investor by nature, it was interesting to note how hard it was to find views that were NOT bullishly biased. It seems we may have now entered a market realm where Unicorns and Bears are only things of legend.

2015-01-10 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Greece's renewed drama is more noise than signal; U.S. job growth rolls merrily along

2015-01-09 Five Decades of Middle Class Wages: Update by Doug Short (Article)

Note from dshort: I've updated this series to include today's release of the December employment data. While my focus here is on long-term trends, I want to call attention to the six-cent decline from November to December in the average hourly earnings for this cohort. That's the largest month-over-month decline in the history of the series, which dates from 1964. The second largest was three cents in August 1983.

2015-01-09 Nonrandom Patterns by Keith McCullough of Hedgeye Risk Management

What an excellent start to 2015! It?s been years since I?ve seen so many great long and short ideas across the Global Macro universe. If your portfolio mandate is diversified and flexible (across asset classes), I think you can have a crusher of a year!

2015-01-09 Recovery Gaining Momentum? by Ed Devlin, Mike Cudzil, Lupin Rahman of PIMCO

U.S. growth will remain robust over the cyclical horizon due to increasing consumption driven by the narrowing unemployment gap and increase in disposable incomes. The Canadian recovery should continue, though divergent forces ? including the U.S. recovery and oil price declines ? could have significant implications for the economy. Growth will be muted across Latin America, with some economies benefitting from U.S. growth, and others dragged down by the slowdown in the eurozone and China.

2015-01-09 A Tale of Two Earnings Seasons by Burt White of LPL Financial

The fourth quarter of 2014 will be a tale of two earnings seasons: the best of times and the worst of times. Despite a substantial drag from the energy sector, we expect another good earnings season overall. We expect more winners from cheap oil than losers, although the energy sector faces significant challenges.

2015-01-09 A Devoted Contrarian Needs Patience by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, argues that despite their clear value, "fundamental analysis and contrarian thinking are not very precise investment-timing tools." He explores the dangers of both acting too son and acting too late even when an anticipated substantive investing scenario comes into being.

2015-01-09 The Wild, Wild East: Risks and Opportunities in Russia by Chris Brightman, Vitali Kalesnik of Research Affiliates

Investors in Russian companies are exposed to political and economic risks that raise the odds of default. But Russia needs western capital and is willing to pay up for it. Long-term investments in Russian equities might prove rewarding.

2015-01-09 Investment themes for a ?Groundhog Day? world by David King of Columbia Management

Wall Street strategists and ?financial media pundits have spent much of the last several years foreshadowing a dramatically changing investment environment and telling people what to do about it.

2015-01-09 Pie in the Sky? by Team of Absolute Return Partners

January each year brings with it a host of forecasts, many of which are 'pie in the sky' - silly predictions on equity markets, interest rates and currency movements. We are not in that game, but this is the first time we have written a letter in January. Why? Because we think investors should be focusing on longer term structural trends when analysing the future.

2015-01-09 Grease and Greece by Richard Bernstein of Richard Bernstein Advisors

With the energy sector and Eurozone concerns dominating the financial industry?s outlook on 2015, see what RBA believes to be the real issues facing both Greece and Grease.

2015-01-09 The Hidden Perils of Low Interest Rates by John Browne of Euro Pacific Capital

Late last year, with the U.S. economy experiencing falling unemployment and seemingly low inflation, observers were extremely confident that the Federal Reserve would move judiciously in 2015 to restore 'normal' interest rates sooner rather than later. However, in light of the recent fall in both stocks and oil, that conviction has softened considerably.

2015-01-09 Shades of APEC Blue by Raymond Deng of Matthews Asia

During last year's Asia-Pacific Economic Cooperation summit, Beijing revealed stunning blue skies to replace its normally smog-choked atmosphere?a result of intentional government closings of factories and roads. Producing "APEC blue" as it came to be called was a complicated and expensive task. Asia Weekly explores such initiatives in China.

2015-01-08 Consensus Macro Memes by Keith McCullough of Hedgeye Risk Management

Do Global Macro Themes propagate themselves into consensus narratives? You bet your Madoff they do. But timing them matters. You really get paid by front-running them by 3-6 months.

2015-01-08 Global Economic Outlook by Team of Northern Trust

Re-entry to the workplace after the holiday season isn't exactly like a satellite descending from earth's orbit.

2015-01-08 TIPS Adjust to the Financial Market Environment by Stephen Percoco of Lark Research, Inc.

U.S. Treasury Inflation-Protected Securities had a solid year in 2014, bouncing back from losses in 2013. Yet, except for the losses in 2013, TIPS returns were the lowest since 2008.

2015-01-08 Europe?s Lapse of Reason by Joseph Stiglitz of Project Syndicate

If Europe does not change its ways ? if it does not reform the eurozone and repeal austerity ? a popular backlash will become inevitable. Though Greece may stay the course following its early election later this month, democracy will not permit the economic madness to continue.

2015-01-08 Consumer outlook ? a strong start in 2015 by Scott Brown of Raymond James

Amid all of the recent economic data releases, the consumer spending figures stand out. The near-term outlook for the consumer has improved substantially, but financial market participants have yet to embrace the good news.

2015-01-08 All about that base by Jeffrey Saut of Raymond James

The transition from one year to the next is always accompanied by a whole host of traditions intended to help people celebrate this annual new beginning. The resolutions, parades, fireworks, football games, food, furniture sales ? they all seem to be experienced in a fresh, optimistic light, like an all-forgiving reset button was hit when that ball dropped on New Year?s Eve.

2015-01-08 3 Things - Volatility, The Fed and Yield Spreads by Lance Roberts of Streettalk Live

Since the end of the Federal Reserve's latest QE program, market volatility has picked up markedly. Since October, as QE came to its final bond buying conclusion, the drain of liquidity begin to financial market activity. As shown in the chart below, there have been three fairly sizable selloffs last quarter of 7.9%, 5.0%, and 4.3%.

2015-01-08 Levitate: More Market Mood Swings in 2015? by Liz Ann Sonders of Charles Schwab

Secular bull market is likely intact, but 2015 could bring more volatility associated with Fed policy and/or global events. Longer-term sentiment suggests the ?wall of worry? is intact; but shorter-term sentiment is more troubling. Falling oil and rising dollar have generated loads of questions from clients ? history tells a generally positive story.

2015-01-08 Will Active Stock Picking Be More Relevant in 2015? by Charlie Dreifus of The Royce Funds

While active managers continued to struggle in 2014, we remain confident in our approach, which emphasizes discipline, patience, and absolute results. Portfolio Manager and Principal Charlie Dreifus discusses the performance of his small-cap portfolio, what sectors and industries he found most interesting at the end of 2014, conditions in place that may lead to a more robust M&A market in 2015, the state of the U.S. economy, and why he believes the value of active stock picking will increase in importance.

2015-01-08 Averages Won't Keep You Warm...or Wisely Invested by Jack Tierney of Invesco Blog

When investors build their portfolio allocations, they correctly look at long-term average returns for the asset classes they?re considering, such as stocks, bonds, real estate, cash and alternatives. After looking at the returns for asset classes below, though, an investor may be tempted to invest everything in emerging market securities and real estate investment trusts (REITs), as they have the highest average annual returns over the last 10 years.

2015-01-07 Will Current M&A Activity Benefit Small-Caps? by (Article)

With M&A total deal volumes running at their highest pace since 2007, what has spurred increased activity? Portfolio Manager Lauren Romeo and Director of Consultant Relations & Client Service Jeff Smith discuss the correlation between improving economic conditions and increased corporate spending.

2015-01-07 Recession Probability Models - January 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession. While I don?t agree with the methodologies employed or probabilities of impending economic weakness as depicted by the following two models, I think the results of these models should be monitored.

2015-01-07 Keeping Track of Changing Values by Matt Collins of Source

Stock prices keep moving, even after the exchanges close.

2015-01-07 How Can The Bond Bull Keep Going? by Roger Nusbaum of AdvisorShares

In our Weekly Market Update we have made an effort to track the deflationary story being told in the global fixed income markets, specifically sovereign yields have continued to trade lower defying what most investors thought was possible; Swiss 10 year debt recently yielded 25 basis points. A while back I quoted a Seth Klarman Tweet about German debt trading at multi-century low yields.

2015-01-07 ISM Data Point to a Slowing but Still Strong U.S. Real GDP Growth in 2014 Q4 by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) released data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers, and the media as they provide the earliest reading on the current state of the economy.

2015-01-07 Action and Reaction by Team of Heartland Advisors

A summary of Newton?s third law may best describe the effects of the macro events that surrounded 2014 and brought it to a close: Nothing happens in a vacuum. The trick is to anticipate what the consequence of any action might be.

2015-01-07 A ?Living in the Moment? Guide to Investing by Jerry Wagner of Flexible Plan Investments

New Year?s Eve is all about partying for a large percentage of the world?s population, but it has a different meaning to me. Don?t get me wrong. I?ve gone to my share of NYE parties, including doing the Times Square thing in 2000 (highly recommended!). But over the years I?ve shifted away from celebrating that way.

2015-01-07 Economic Optimism Abounds As Crude Oil Plunges by Gary Halbert of Halbert Wealth Management

Each year at this time, we see a plethora of fresh forecasts for the New Year, and this year is certainly no exception, especially with the recent implosion in oil prices. There is widespread agreement that sharply lower energy prices will provide a boost to the global economy this year, especially for oil-importing nations including the US.

2015-01-07 Is Your Portfolio Ready for 2015? #crash by Axel Merk of Merk Investments

Is the recent bout in volatility yet another ?buy-the-dip? opportunity or a sign of worse to come? Investors struggle to both keeping up with the markets while protecting themselves against a severe correction. By taking a step back, investors might be able to see the forest for the trees to gauge whether their portfolio is ready for what lies ahead.

2015-01-07 2015 Investment Outlook: Emerging Markets Still Global Growth Drivers by Mark Mobius of Franklin Templeton Investments

We at Templeton Emerging Markets Group believe high economic growth rates will remain a key attraction of many emerging markets in 2015. Even with major economies like Brazil and Russia slowing down, overall economic growth in emerging markets during 2015 is expected to be comfortably in excess of developed markets, with China and India likely to drive the Asian region to particularly strong growth.

2015-01-07 A Quick Look at the World Economy by Russ Koesterich of BlackRock

An assessment of where the different world economies stand, including a look at the United States, Europe and Asia.

2015-01-07 Health Care Stocks Pick Up in 2015 Where They Left Off in 2014 by Team of GaveKal Capital

Across two of the three regions in the MSCI World Index, the health care sector has been the best performer over the last year. In North America, measured in USD, health care stocks are up 29.13% over the last year, while they were up 5.96% in Europe and 2.53% in Asia/Pacific.

2015-01-07 Transition to the Cloud: Do-or-Die Time For Laggards by Paul Meeks of Saturna Capital

Saturna places considerable emphasis on technology, especially in growth strategies. Amana Growth and Sextant Growth Funds sport tech heavy allocations well in excess of their benchmarks.

2015-01-06 An In-Depth Look at Two Dodge & Cox Funds by Larry Swedroe (Article)

For investors looking to choose a U.S. large-value fund, The Dodge & Cox Stock Fund (DODGX) is an excellent candidate. Given its outstanding record, let's take a look at the fund's performance.

2015-01-06 The Shiller P/E Enters Rarefied Air by Keith Goddard, CFA (Article)

The domestic stock market cannot deliver a sustainable double-digit return without entering a speculative bubble, based on historical data reflecting correlations between the level of the Shiller P/E and subsequent outcomes in the stock market over the past 134 years. Conditions are ripe for a speculative bubble in the domestic stock market in 2015, and investors should reduce risk in their portfolios in stages during the coming year.

2015-01-06 How to Influence Your Prospects by Daniel Solin (Article)

Here are some tips for how you can influence a prospect in the manner most likely to achieve a positive result.

2015-01-06 New Year's Resolutions for Advisors by Beverly Flaxington (Article)

I am asking everyone in my advisory firm to write down resolutions for 2015. I want to post these as motivation. As the owner of the firm, I know I need to do the same. What are some of the best resolutions advisors can make?

2015-01-06 Evaluating the Arguments for the Dollar's Demise by Seaborn Hall (Article)

From the great financial crisis and the massive escalation of sovereign debt and QE to the threat of currency wars to cries from pundits to exit the dollar and buy gold, it requires a discerning advisor to sift through the din and decide whether the dollar's reserve status is slipping. Could the dollar look strong and still be in danger? Several recent books, and papers from the BIS, IMF and Fed delineate the noise from the reality.

2015-01-06 Six Key Steps to Build Prospecting Momentum in 2015 by Dan Richards (Article)

Here are six key steps to make 2015 the year that you build prospecting momentum.

2015-01-06 Ben Graham's Mr. Market 2015 by William Smead of Smead Capital Management

As we enter 2015, we at Smead Capital Management would like to separate how unsuccessful investors use Mr. Market and how successful investors use his "voluntary" participation in the stock market.

2015-01-06 As We Enter 2015, "Bulls" Should Consider by Lance Roberts of Streettalk Live

As we enter into 2015, analyst calls for a continued "bull market" advance have never been louder. There have been a litany of articles written recently discussing how the stock market is set for a continued bull rally. The are some primary points that are common threads among each of these articles.

2015-01-06 Hurts So Good: When Exactly Are Falling Prices Bad? by Peter Schiff of Euro Pacific Capital

The sudden fall in the price of oil provides a unique opportunity to examine the widely held belief that deflation is economic poison. As many governments and central banks have vowed to fight deflation at all costs in 2015, the question could hardly be more significant. While falling prices may strike the layman as cause for celebration, economists believe that it can kick off a nasty, and often inescapable, negative cycle, which many believe leads inevitably to a prolonged recession, or even a depression.

2015-01-06 Oil, Currencies, and the Fed by Richard Michaud of New Frontier Advisors

Fourth quarter headlines included volatility spikes, dramatic declines in oil prices, and positive views of the economy by the Fed. Oil declined 41% this quarter and 46% for the year. The dollar continued to gain against some major developed global currencies. For the year, the dollar gained 13.6% against the euro and 13.8% against the yen while gold was down 2%.

2015-01-06 2015: More Investment and Profits, Higher Rates, Dollar and Stocks by Brian Wesbury, Robert Stein of First Trust Advisors

Contrary to popular opinion, business investment is a key factor behind the current recovery. Productive investments have boosted profits to record highs and, in turn, those profits have driven stock prices to record highs. They should continue to do so.

2015-01-06 Volatility May Bring Opportunity and Challenges by Burt White of LPL Financial

As the economic and market cycles progress, increased volatility[1] should be expected; however, none of our Five Forecasters show elevated reason for concern, indicating a recession is unlikely in 2015.

2015-01-06 The Cuban Thaw by Bill O'Grady of Confluence Investment Management

On December 17, 2014, President Obama surprised the country by announcing a prisoner exchange and negotiations to begin establishing diplomatic relations with Cuba. Given that the Eisenhower administration broke off diplomatic relations with Cuba in January 1961, even considering resuming relations is a major change in policy. In this report, we will discuss the importance of Cuba to the geopolitics of the U.S and offer a short history. We will analyze the limits of the current thaw and why this attempt at rapprochement is occurring now. As always, we will conclude with market ramifications.

2015-01-06 Ides by William Gross of Janus Capital Group

Beware the Ides of March, or the Ides of any month in 2015 for that matter. When the year is done, there will be minus signs in front of returns for many asset classes. The good times are over.

2015-01-06 U.S. Municipal Finances On the Mend by Milton Ezrati of Lord Abbett

While much work still needs to be done, the financial condition of state and local governments in the United States continues to improve. What does this mean for investors?

2015-01-05 2015 Challenges & Opportunities by Matt Beesley (Article)

Matt Beesley, Head of Global Equities at Henderson, discusses current hot topics in the markets going into 2015 including: the oil price, US dollar strength and the possibility of European quantitative easing. With each, Beesley notes, comes a myriad of challenges/risks as well as a lot of opportunities for active stock pickers.

2015-01-05 Regression to the Mean by Kendall Anderson of Anderson Griggs

I often hear from many of you that you know very little about investing. However, I find that most of you understand investing quite well. Many of the concepts and theories thrown out by those of us who claim to be professionals can be restated into words and phrases you use regularly. For instance, when you say, what goes up must come down, or, when you are going through a particularly tough time, dont worry, things will get better, you are showing your knowledge of regression to the mean.

2015-01-05 Tips for Navigating The Market in 2015 by Russ Koesterich of BlackRock

As the calendar turns to 2015, its time to assess the investing landscape and your investment portfolio to ensure youre well positioned for the New Year. The BlackRock List can help.

2015-01-05 Pills for Cognitive Dissonance in a Speculative Bubble by John Hussman of Hussman Funds

Several years of persistent yield-seeking speculation provoked by zero-interest rate monetary policies have created a fertile ground for cognitive dissonance.

2015-01-05 China Watch: Bull Market Ahead? by Mark Ungewitter of Charter Trust Company

Something interesting is happening in China. Financial stocks are surging relative to the broad market. The "hockey stick" liftoff began in late November when the People's Bank of China (PBOC) cut policy rates for the first time since 2012. China is the world's only large economy with room to pursue conventional monetary policy. Further rate cuts are likely as falling energy costs put downward pressure on consumer prices.

2015-01-05 Is the Stock Market Cheap? by Doug Short of Advisor Perspectives (

Here is a new update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month, which is 2,054.27.

2015-01-05 Paul Krugman and the Obama Recovery by Jeffrey Sachs of Project Syndicate

The Nobel laureate economist is a great economic theorist and a great polemicist. But he should replace his polemical hat with his analytical one and reflect more deeply on recent experience: rather than throwing the US back into recession, deficit reduction has been accompanied by recovery, job creation, and lower unemployment.

2015-01-05 Energy: Technology Disruption, but not to all by Matt Lloyd of Advisors Asset Management

Disruptive Technologies are the gold vein every entrepreneur seeks, but rarely find. Clayton M. Christensen, the patriarch of observing disruptive technologies, noted in his seminal book The Innovators Dilemma in 1997 that each breakthrough can be categorized as either disruptive or sustaining.

2015-01-04 Weighing the Week Ahead: Time for the January Effect? by Jeff Miller of New Arc Investments

I am not a big fan of seasonal effects unless there is a logical underlying reason. The Presidential cycle logic rests upon taking unpopular actions early in the term while emphasizing economic stimulus later. That does not have much relevance in the current environment. The January tax loss effect is more persuasive, especially in years where there are some clear losers to sell. That was true in many sectors this year.

2015-01-04 Why the World Needs the US Economy to Struggle by John Mauldin of Mauldin Economics

In this weeks letter, my associate Worth Wray explores what a rising dollar means for emerging markets and what central banks are likely to do in response. Can they smooth the ride, or will it be the worlds scariest roller coaster? This letter will print long because of the number of fabulous charts Worth provides. I might make a brief comment or two at the end. Heres Worth.

2015-01-03 Flying High in the Sky, Looking for Opportunities in 2015 by Frank Holmes of U.S. Global Investors

Savvy investors know to be patient with their holdings and not easily give in to the prevailing culture of instant gratification. Ive run multiple marathons over the years and am intimately familiar with the personal rewards of going the distance. A similar investing strategy can come with the same rewards.

2015-01-02 Do Economic Sanctions Work? by Kenneth Rogoff of Project Syndicate

With Western economic sanctions against Russia, Iran, and Cuba in the news, it is a good time to take stock of the debate on just how well such measures work. The short answer is that economic sanctions usually have only modest effects, even if they can be an essential means of demonstrating moral resolve.

2015-01-02 Chuck Royce on 4Q14: Positioning for a Normalizing Economy by Chuck Royce of The Royce Funds

Chief Executive Officer and Portfolio Manager Chuck Royce discusses the spread between large- and small-cap returns in 2014, the current case for active management in the small-cap space, the valuation picture as we enter 2015, and the impact lower energy prices are likely to have on stocks.

2015-01-02 Inflation Is Not Traveling in the Right Direction by Russ Koesterich of BlackRock

Inflation is something that those of us in the investment community have been talking about for a while now. While some economists worry that the easy monetary policy of recent years will eventually lead to significant inflation, it is possible that too little inflation is on the horizon, not too much.

2015-01-02 2015 Investment Outlook: EuropeThe Saga Continues by David Zahn of Franklin Templeton Investments

David Zahn, head of European Fixed Income and portfolio manager, Franklin Templeton Fixed Income Group, gives his perspective on what he thinks may lie ahead as the eurozones drama continues into 2015.

2015-01-02 Stability and Prosperity in Monetary Union by Mario Draghi of Project Syndicate

There is a common misconception that the eurozone is a monetary union without a political union. In fact, monetary union is possible only because of the substantial integration already achieved among European Union countries and sharing a single currency deepens that integration.

2015-01-02 Where Will All the Workers Go? by Nouriel Roubini of Project Syndicate

In the years ahead, technological improvements in robotics and automation will boost productivity and efficiency, implying significant economic gains for companies. Yet, unless the proper policies to nurture job growth are put in place, it remains uncertain whether demand for labor will continue to grow as technology marches forward.

2015-01-02 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.8, unchanged to one decimal place from the previous week. The WLI annualized growth indicator (WLIg) is at -3.9, down from -3.3 the previous week. This is its lowest level since February 2012.

2015-01-02 Rounding Third and Heading for Where? by Robert Isbitts of Sungarden Investment Research

These past few weeks, with the year winding down and investment strategy decisions to think about (always), I spent a lot of time with my research team analyzing historical stock market index data as far back as 1871. First conclusion: I am sick and tired of analyzing historical stock market index data! We did this to see what todays investor might learn from market history.

2015-01-02 Global Economic Outlook: US Sets the Pace for Growth in 2015 by John Greenwood of Invesco Blog

As we begin the new year, there are certain key issues that I expect to dominate the macroeconomic conversation and to impact markets around the world. Here, I highlight a few of those issues.

2014-12-31 Falling Energy Costs And Economic Impacts by Lance Roberts of Streettalk Live

In the financial markets and economics it is a common occurrence that the media and commentators will latch on to a statement that supports a cognitive bias and then repeat that statement until it is a universally accepted truth.

2014-12-31 Gold Beat All Other World Currencies in 2014 by Frank Holmes of U.S. Global Investors

Loyal readers of our Investor Alert and my blog Frank Talk are no doubt aware that the U.S. dollars rising strength has put pressure on commodities such as oil and gold. I wrote about this as recently as my roundup of the top commodities stories of 2014, which you can read here.

2014-12-31 All Asset Outlook 2015: The bright side of growth by Bill McQuaker and Paul O’Connor (Article)

Bill McQuaker and Paul O’Connor, Co-Heads of Multi-Asset, assess the macroeconomic backdrop, how it could impact financial markets in 2015, and how this is driving their positioning. Global growth may have disappointed as 2014 comes to an end, but looking ahead to the new year the Multi-Asset Team sees scope for a positive growth surprise, due in part to reduced fiscal tightening and less bank de-leveraging, oil price effects, and supportive central bank policy.

2014-12-31 2015 Investment Outlook: EuropeThe Saga Continues by David Zahn of Franklin Templeton Investments

Like television fans deciphering a season-finale cliffhanger, investors have been left with unanswered questions about the eurozone as 2014 draws to a close. Will the European Central Bank unleash full quantitative easing? Will the eurozone fall into a recession? David Zahn, head of European Fixed Income and portfolio manager, Franklin Templeton Fixed Income Group, gives his perspective on what he thinks may lie ahead as the eurozones drama continues into 2015.

2014-12-31 Structural Reforms in Asia by Sharat Shroff of Matthews Asia

The global investment community continues to deliberate about the impact of quantitative easing stemming from Europe, and more recently from Japan, as a means to revive domestic demand. Meanwhile, several Asian economies are embarking on a different kind of stimulus, aimed at boosting long-term productivity and investment spending, through structural changes to the underlying economies.

2014-12-31 2015 Global Market Outlook: Exploring the Growth Landscape by Simon Fennell, Olga Bitel of William Blair

For much of 2014, the financial press was filled with dire headlines warning of global stagnation and deflation. These demoralizing reports seemed to paralyze policy makers. The facts behind the headlines, however, suggested the reality was not nearly as gloomy or pessimistic as it seemed. This paper outlines a more optimistic outlook for 2015 where the world economy is expected to remain resilient and where the outlook for sustainable corporate returns remains strong.

2014-12-30 Household Incomes Across Time: The Divergence at the Top by Doug Short (Article)

Among the most interesting of the long-term economic indicators I track is the Census Bureau's annual data on the mean (average) household income received by each fifth (quintile) and top 5 percent. See my latest update here. A conspicuous pattern in the series is the widening of the spread in income growth that started during the 1980s.

2014-12-30 The 10 Most-Read Articles of 2014 by Various (Article)

As is our custom, we conclude the year by reflecting on the 10 most-read articles over the past 12 months.

2014-12-30 The Ten Best Articles You Probably Missed by Robert Huebscher (Article)

Great articles don't always get the readership they deserve. Here are 10 that you might have missed, but I believe merit reading

2014-12-30 Your Most Important Resolution for 2015 by Dan Richards (Article)

What's the single change that more than any other would drive your business to new heights in 2015?

2014-12-30 The "Art" of Gathering AUM Should be a "Science" by Daniel Solin (Article)

The process of converting prospects into clients is more of a science than an art. There is peer-reviewed support that shows how you can skew the odds in your favor by following some basic rules. Here are some suggestions.

2014-12-30 Qualified Charitable Distributions by Tim Steffen (Article)

The Qualified Charitable Distribution rules allow taxpayers to make IRA distributions payable directly to a qualified charity without treating the distribution as taxable income. The QCD rules have expired and then extended periodically over the years, and were recently extended again through 2014 with the passage of the Tax Increase Prevention Act of 2014. These rules do expire again after 2014, meaning taxpayers will enter 2015 with the same uncertainty they had throughout the prior year.

2014-12-30 Can Every Advisor Learn to Sell? by Beverly Flaxington (Article)

I hired an advisor who showed great promise. Now, nine months later, he does not have a new asset to his name. I read some of your articles on developing selling skills but I wonder whether some advisors just can't learn to do it.

2014-12-30 2015 Investment Outlook - Stay Tactical! by Stephen Blumenthal of CMG Capital Management Group

I wrote often throughout 2014 about the danger signals flashing from an excessive run up in debt and derivatives. We have a repeat of the scenario we suffered in 2008, only much worse. The budget recently passed by Congress put taxpayers on the hook for a 2008-like derivatives failure. The potential losses could exceed the previous financial meltdown as other world market conditions exacerbate a bad situation.

2014-12-30 Can The Dollar Save Small Caps? by Doug Ramsey of Leuthold Weeden Capital Management

The dollar’s moonshot in recent months has resuscitated a stock market leadership argument we haven’t heard for a long time—namely, that Small Cap stocks are better insulated than Large Caps from the loss of competitiveness and the currency translation impact of a stronger buck. Is there merit to this argument, or are Small Cap proponents grasping for straws after a flat year? It turns out there’s reasonable support for the Small Cap enthusiasts’ view, based on evidence from the U.S. (trade-weighted) Dollar Index.

2014-12-30 U.S. Consumers: Spend More? Bah, Humbug by Milton Ezrati of Lord Abbett

Despite an improving labor market and lower oil prices, consumer outlays should continue to expand at a slow pace. Heres why.

2014-12-30 MLPs Werent Supposed To Decline by Roger Nusbaum of AdvisorShares

Most income investors will know at least a little about Master Limited Partnerships more commonly referred to as MLPs. Most MLPs are tied to the transportation of energy products. They collect royalties as the energy product moves through their pipeline (this is a very common structure). Fundamentally, the movement of MLPs should not be vulnerable to price movements of the underlying energy product. The royalty collected is what it is.

2014-12-29 Fixed Income - 2015 Outlook by Phil Apel (Article)

Phil Apel, Head of Fixed Income at Henderson, shares his views on the outlook for fixed income markets in 2015, and the lessons learnt from a really interesting year for bond investors. In the video he discusses: central bank policy divergence, fixed income liquidity and volatility in 2014, where he sees risks and opportunities in 2015, how a lower oil price could spur growth and his current investment strategy.

2014-12-29 Unsettling Interplay of Leading Indicators by Alexander Giryavets of Dynamika Capital L.L.C.

We review in details where we stand in terms of the US and World leading indicators and point to some of the unsettling recent developments which should be watched carefully over the coming months.

2014-12-29 The Coming Crash in 2015: Why there will be no Happy New Year before we see QE Reloaded by Franz Lischka of Franz Lischka

In September 2013 in my post How QE Alters Bond Yields (Or Rather How It Does Not) I wrote that historically the end of QE was associated with the following 4 events, which I expected to show up again after the end of the latest QE-programs (which in some cases was completely against the market consensus of that time).

2014-12-29 Holiday Randoms by Roger Nusbaum of AdvisorShares

Business Inside posted an article a few weeks ago that recapped the Black Swan concept using Nassim Talebs example of the Thanksgiving Day Turkey who is well fed and treated well until the day before Thanksgiving and then the ax fallsliterally.

2014-12-29 Adventures in Forecasting by Scott Brown of Raymond James

Every December, economists are asked for their projections for the coming year. Whats GDP growth going to be? How many jobs will be added? Whats the Fed going to do? How will the financial markets react? We build models of the economy models that we know are not precise. There are simply too many variables.

2014-12-29 Adam Smith or Jerry Goodman by Jeffrey Saut of Raymond James

I met Jerry Goodman, whose nom de plume was Adam Smith, late in my career. He was working at my friend Craig Drills money management firm along with another icon in this business, from an era gone by, namely Al Wojnilower. I have had many conversations with all three of these Wall Street legends around the conference table at Drill Capital Management. Jerry wrote The Money Game (1968), Powers of Mind (1975), Paper Money (1981), and The Roaring 80s (1988), but unfortunately we lost his wisdom on January 3rd of this year .

2014-12-29 Intellectual Property Helps Boost 3Q GDP Growth To Highest Level Since 2003 by Team of GaveKal Capital

As was widely reported yesterday, 3Q GDP growth was the strongest since 9/30/2003. However, less widely reported was the fact the intellectual property products contributed the most to real GDP in 32 quarters (9/30/2006).

2014-12-29 Oil and Emerging Markets: A Double-Edged Sword by Mark Mobius of Franklin Templeton Investments

The price of oil has plummeted this year as a result of increased volatility in most markets and a temporary imbalance of supply and demand. In view of continued long-term world growth, particularly in emerging- and frontier-market countries, we believe oil prices will probably not suffer from a prolonged price slump. As we see it, the demand for raw materials in general, including not only oil but also iron ore, copper, nickel and agricultural products, is still likely to increase over the long term with increased global growth.

2014-12-29 Chicken Little Economics by Brian Wesbury, Robert Stein of First Trust Advisors

Its now been more than six years since the failure of Lehman Brothers when the sky fell in and economic panic seized the land. Since then, Chicken Little Economics has inflicted fear and loathing on many investors.

2014-12-29 Three Potential Opportunities and Three Risks For 2015 by Rick Golod of Invesco Blog

With my 2014 year-in-review now posted, Lessons from 2014, and my full 2015 outlook not arriving until January, I wanted to share a few of my thoughts and expectations for the coming year. Overall, I am bullish on global equities in 2015. That being said, volatility is likely to increase and investors may need to be more selective, as the US adjusts to life after QE, the US Federal Reserve begins raising interest rates, the US dollar strengthens, energy prices continue to decline and global growth moderates in my opinion.

2014-12-29 The Lessons of Oil by Howard Marks of Oaktree Capital

I want to provide a memo on this topic before I and hopefully many of my readers head out for year-end holidays. Ill be writing not with regard to the right price for oil about which I certainly have no unique insight but rather, as indicated by the title, about what we can learn from recent experience.

2014-12-28 The Line Between Rational Speculation and Market Collapse by John Hussman of Hussman Funds

Current equity valuations provide no margin of safety for long-term investors. One might as well be investing on a dare. If we observe an improvement in market internals and credit spreads, it would not make valuations any less obscene, but it would significantly ease our immediate concerns about market losses. A safety net would be required in any event, but there is a range of possible outlooks between hard-negative and constructive with a safety net.

2014-12-27 Epic Price Reversal for Commodities in 2014 by Frank Holmes of U.S. Global Investors

If you want to know what happened in 2014 with regard to gold and oil, it?s important to appreciate the inverse relationship between the U.S. dollar and commodities.

2014-12-27 Perspective on 2015: Maintain Yours by Zachary Karabell of Envestnet

In 2014, interest rates remained low, U.S. equities stayed strong, mid-year geopolitical events barely shook the markets, and a sudden, late-year drop in oil prices took many by surprise. What should investors expect in 2015?

2014-12-27 Sungarden's 2015 Investor Preview by Robert Isbitts of Sungarden Investment Research

2014 is nearly behind us. And since we tend to not want to do things the way the Wall Street herd does, our 2015 outlook is formatted this way: we list a group of potential scenarios, and then assign our best guess probability that they will happen next year. This is about considering the possibilities, not making outright predictions.

2014-12-27 Global Economic Perspective: December by Christopher Molumphy, Michael Materasso, Roger Bayston, Michael Hasenstab & John Beck of Franklin Templeton Investments

With 321,000 jobs added, the initial US nonfarm payroll report for November was much stronger than markets expected and brought job growth this year close to levels last seen in the late 1990s. Added to upward revisions in September and October jobs data, the nonfarm payrolls data reinforces the view that whatever is occurring in the rest of the world, the US economy appears to remain firmly on track to record reasonably strong growth in the months ahead. And while fourth-quarter gross domestic product (GDP) growth this quarter for the United States is expected to be lower than the third-quart

2014-12-27 Break Up Citigroup by Simon Johnson of Project Syndicate

Break up Citigroup, end dangerous government subsidies, and bring back the market. The US presidential candidate who says this in 2016 and says it most convincingly has a good chance of winning it all.

2014-12-27 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

Lakshman Achuthan made a recent appearance (December 24th) on Al Jazeera TV discussing the company's outlook for the US economy in 2015. Despite improvements in GDP and jobs data, Achuthan takes a cautious view. Among other things, he points out that latest year-over-year GDP growth rate of 2.7% (a more intuitive metric than the latest quarterly annualized rate of 5.0%), has happened before since the end of the last recession, only to slide back to lower levels. He identifies US manufacturing as a potentially weak area.

2014-12-24 Municipal Market Perspectives by Fixed Income Management Team of SMC Fixed Income Management

"Constructive but cautious is our 2015 mantra. Price appreciation has been a major contributor to portfolio performance as evidenced by the yield curve shift from the beginning of the year. 2015 market performance should largely be determined by income, with less support from declining yields.

2014-12-24 Early Look: Who is the Author? by Keith McCullough of Hedgeye Risk Management

While I can try to explain why the SP500 can drop 103 points in a straight line (in 7 days), then ramp 106 points in 4 days, I dont think thats where I add value. There are legions of pundits on the #OldWall that use 1-factor moving averages than can help you with that.

2014-12-24 Credit Spreads: Relative vs. Absolute Levels by Bob Andres of Andres Capital Management

Following a yearlong environment of relatively stable corporate bond spreads, we are beginning to see increased market volatility and a widening of these credit spreads. The plunge in oil prices, the rise in the U.S. dollar, and geopolitical uncertainty all contribute to wider spreads as they represent a proxy for market risk.

2014-12-24 10 Stock Market Questions for 2015? by Burt White of LPL Financial

With 2015 almost here, this week we pose and respond to 10 key stock market questions for 2015. Look for more on these and other topics throughout the year.

2014-12-24 The Rolling Stones Understand Long-Duration Investing by William Smead of Smead Capital Management

Its only after the animals are out of the barn that investors want to close the door. This means attempting to make most of the money from participating in common stocks, but somehow regularly going to cash in the worst declines.

2014-12-24 Government Spent $29,000 Per US Household in 2014 by Gary Halbert of Halbert Wealth Management

A new study from The Heritage Foundation found that out-of-control spending in Washington amounted to more than $29,000 per household in fiscal year 2014. Today, I will reprint the highlights of that excellent report. As you will see below, government spending has topped $3.5 trillion in each of the six years that President Obama has been in office.

2014-12-24 The Fed Sets Another Trap by Stephen Roach of Project Syndicate

The US Federal Reserve is headed down a familiar and highly dangerous path. Steeped in denial over its past mistakes, the Fed is pursuing the same incremental policy approach that helped set the stage for the financial crisis of 2008-2009.

2014-12-24 2015 Outlook: Watching Our Overweights by Team of Northern Trust

Asset class returns were much more differentiated this year than last, with yield-oriented assets and U.S. equities being the standout performers. We entered 2014 overweight risk tactically, but made several changes as the year progressed.

2014-12-24 A Healthy Skepticism is Key to Managing Risk by (Article)

At Royce, our more-than-40-year investment approach is built on the idea that preserving capital is just as critical to successful long-term growth as growing it. Portfolio Manager Jim Stoeffel talks to Co-Chief Investment Officer Francis Gannon about his auditing background and how that experience influences the way he assesses risk.

2014-12-23 The Price All Investors Pay for Benchmarking by Michael Edesess (Article)

Could the practice of measuring and evaluating manager performance by comparing it to a market index be distorting prices across the whole market? That is the conclusion reached in a recent paper entitled "Asset Management Contracts and Equilibrium Prices," by three academic researchers, Andrea M. Buffa of Boston University and Dimitri Vayanos and Paul Woolley of the London School of Economics.

2014-12-23 U.S. Equities: Overvalued or Undervalued? by Baijnath Ramraika, CFA® and Prashant Trivedi, CFA® (Article)

Market participants have devised tools to value overall equity markets: the cyclically adjusted price to earnings (CAPE) ratio, Tobin's Q-ratio, the regression trendline, market capitalization-to-GNP (Buffett's valuation indicator) and the trailing price-to-earnings ratio. We summarize each one of these valuation tools and its implications for investors.

2014-12-23 Convertible Bonds: The Rodney Dangerfield of Liquid Alts by Robert Martorana (Article)

Historical returns have been outstanding for convertible-bond strategies. Moreover, low drawdowns during bear markets give these products an attractive risk-return profile, especially when compared to other liquid alternatives.

2014-12-23 Seven Tips for Converting Prospects into Clients by Daniel Solin (Article)

Here are seven evidence-based tips to improve your persuasive skills for converting prospects to clients.

2014-12-23 Tax Increase Prevention Act of 2014 by Tim Steffen (Article)

In the waning days of the Congressional year, the House and Senate gave new life to more than 50 tax provisions that had expired at the end of 2013, giving them all a one-year extension through 2014. Included in this extension were popular individual tax breaks, including the ability to make charitable gifts directly from an IRA, an option to deduct state sales tax rather than income tax and an above-the-line deduction for tuition costs. The bill also created a new tax-favored savings account for those with disabilities.

2014-12-23 Internal Mentoring or External Coaching? by Beverly Flaxington (Article)

We are considering two methods for training our younger team members: using internal senior staff mentors or hiring an external coach. Which do you think is best?

2014-12-23 Three Reasons why Robo-Advisors are a Huge Benefit to the Advisory Profession by Bob Veres (Article)

It's time to change our thinking about the so-called robo-advisory firms that are moving into the financial planning landscape. They are going to be far more beneficial to the planning/investment advisory profession than any innovation in recent decades. Let's explore three ways these firms are changing the planning ecology, and note that all of them are not just positive, but significantly positive.

2014-12-23 Four Steps to Make Resolutions Stick by Dan Richards (Article)

My last two weeks' columns have outlined how to break the cycle of high hopes around New Year's resolutions followed by disappointment and dashed expectations. Here are four additional steps to create new habits in your routine.

2014-12-23 Could an Energy Bust Trigger QE4? by Peter Schiff of Euro Pacific Capital

In a normal economic times falling energy costs would be considered unadulterated good news. The facts are simple. No one buys a barrel of oil to display above the mantle. No one derives happiness from a lump of coal. Energy is simply a means to do or get the things that we want

2014-12-23 Has Diversification Lost Its Luster? by Patty Quinn McAuley, CFP of Clark Capital Management Group

One of the most basic tenets of investing has been the importance of diversification. Individual investors can quickly understand the concept of not putting all your eggs in one basket. However, the recent market environment has been punishing the prudent, diversified investor.

2014-12-23 Setting the Scene for 2015 by Milton Ezrati of Lord Abbett

Market prospects in the coming year would seem to hinge on four major considerations. One is geopolitics, inherently unpredictable but potentially disruptive, especially these days. Another is the Federal Reserves plan to raise interest rates along a gentle path beginning sometime in the middle of the year. Third is the perennial question of where value lies within and between markets. Fourth is the state of the U.S. economy.

2014-12-23 2015 - What Does Cycle Analysis Suggest by Lance Roberts of Streettalk Live

We cant predict the future if it were possible fortune tellers would all win the lottery. They dont, we cant and we arent going to try to. However, we can analyze what has happened in the past, weed through the noise of the present and try to discern the possible outcomes of the future.

2014-12-23 Growth Headwinds Continue to Blow Through Asia in 2015 by Adam Bowe, Tomoya Masanao, Robert Mead of PIMCO

This commentary discusses the conclusions from PIMCOs quarterly Cyclical Forum in December 2014 and how they influence our Asian outlook and investment strategy.

2014-12-23 Canary in a Coal Mine? by Dennis Rhee of AdvisorShares

With the collapse of oil, market participants are logically discussing which assets are vulnerable to more selling and which are value buys.

2014-12-22 Weighing the Week Ahead: Time for the 2015 Pundit Forecasts! by Jeff Miller of New Arc Investments

With little fresh news during the holidays and many pros on vacation, I expect a time of reflection and prediction. Publications hungry for content and TV producers needing to fill slots will highlight forecasts of any and all flavors. This happens every year, but the mid-week holidays are pushing it a little earlier than usual,

2014-12-22 Come and Listen to a Story About a Man Named Jed by Ted Ake of Willingdon Wealth Management

For those that were around in the 1960s, the Beverly Hillbillies were a highlight of lowbrow humor. Lester Flatt and Earl Scruggs played the theme song that I still sing today. The story of a poor mountain family that strikes it rich when oil is found on their land, made millions of us laugh as they moved to a huge mansion in Beverly Hills.

2014-12-22 Jorge Posadas (Financial) Slump by Roger Nusbaum of AdvisorShares

Add Yankee great, Jorge Posada to the long list of names of professional athletes who have been done in by their investment advisors. There are of course several accounts of this around the web but according to the NY Post he lost millions on a real estate deal and in a hedge fund run by his advisors. The Post implies he has not been totally wiped out but that Posada and his wife, who are referred to as nave in the article, have taken a meaningful blow to their net worth.

2014-12-22 4 Sectors That May Be Worth Avoiding by Team of GaveKal Capital

Success in investing can many times come down to avoiding the major losers rather than always hitting home runs with one's winners. Correct sector allocation plays an important role in sidestepping potential landmines that out there in the market.

2014-12-22 Could an Energy Bust Trigger QE4? by Peter Schiff of Euro Pacific Capital

In a normal economic times falling energy costs would be considered unadulterated good news. The facts are simple. No one buys a barrel of oil to display above the mantle.

2014-12-22 Stars Align This Holiday Shopping Season by Russ Koesterich of BlackRock

American consumers are in a better spending mood for many reasons. We think the final tally for holiday retail sales could differ from the gloomy picture some of the initial estimates had painted.

2014-12-22 This Deal Wont Last: Give to Charity Now! by Tara Thompson Popernik of AllianceBernstein

Philanthropic US taxpayers should greet the Tax Increase Prevention Act of 2014 with holiday cheer. The law extends several expired tax provisions for 2014 onlyincluding qualified charitable IRA distributions. But other giving strategies may make some taxpayers merrier come tax time.

2014-12-22 Completing the Alternative Investments Puzzle: Putting the Pieces Together by Walter Davis of Invesco Blog

In my previous blog, I discussed why I believe advisors and investors should approach alternative investments much like a jigsaw puzzle and offered an organizing framework that can help. When putting together a puzzle, the first step is to sort and organize all the pieces. For alternatives, the first step is to organize and align the various alternative strategies with specific investment objectives. This step is critical because it helps investors decide whether alternatives can help them meet their needs, and, therefore, whether they should invest in them.

2014-12-22 A Look Back at 2014 (and a 2015 Preview) by Robert Doll of Nuveen Asset Management

At the beginning of this year, we had three broad thoughts about what it would look like. First, we expected U.S. economic growth would accelerate moderately. Second, we believed Federal Reserve tapering would occur slowly and that global monetary policy would remain accommodative. And third, we forecasted that the U.S. equity market would grind higher due to central bank liquidity, modest economic acceleration, solid corporate earnings, contained inflation and an improving fiscal situation. These views formed the basis for the predictions we made in January. And at this point, we can offer a

2014-12-22 The US Dollar and the Cone of Uncertainty by John Mauldin of Mauldin Economics

For the past two letters weve been looking at the global scene and trying to figure out which issues will help us outline scenarios for 2015. We finish the series today by looking at the impact of the dollar bull market on the probabilities for various 2015 developments.

2014-12-21 2014 In Review: A Good Year to Avoid Performance Envy by Robert Isbitts of Sungarden Investment Research

2014 has been an odd year in many ways. Easy money has continued to be the rule for central governments across the world, and this has created false sense of security that is going on six years (following the end of the financial crisis-induced stock market decline that ended in March, 2009). To us, it was a year of waiting: for an end to the suppression of interest rates to aid retirees, for the U.S. Congress to do something productive, and for investors to start taking risk more seriously and stop falling for Wall Street come-ons.

2014-12-21 Rising Insurance Premiums: A New Impetus for Voluntary Funding of Corporate Defined Benefit Plans by Markus Aakko, Rene Martel, Kate Tan of PIMCO

?The Pension Benefit Guaranty Corporation will hike variable-rate premiums on unfunded liabilities in corporate defined benefit plans in 2015 and 2016. The increases along with muted return potential on stocks and bonds and aging plan demographics could make borrowing to reduce or eliminate funding shortfalls less expensive than paying PBGC variable-rate premiums. For efficient execution, we believe it is important to consider appropriate investment strategies before any funding decisions are made.

2014-12-21 The Second Wind of Abenomics? by Sachin Gupta, Tomoya Masanao of PIMCO

Mr. Abe now has up to four more years in power. While investors are likely to be patient in the near term, unless Abenomics gains a second wind the way a tired athlete finds the will to pick up the pace and finish strong there is a risk that this post-election market euphoria could be short-lived. The time for him to act is now.

2014-12-21 The 2014 Festivus Airing of Grievances by Paul Kasriel of Econtrarian

Well, its that time of the year again for the airing of grievances. And Ive got a lot of problems with you people! First of which are those of you (PK, NYT?) who insist that the Feds QE did not result in any inflation. It all depends on your definition of inflation. If your definition is restricted to the prices of goods and services, you are right.

2014-12-21 Your Time is Gonna Come: From Considerable Time to Patient by Liz Ann Sonders of Charles Schwab

Regardless of the obsession around the specific words used, the statement is somewhat par-for-the-course; and supports our consistent view that rates should begin rising at some point in mid-year 2015, that the US dollar will remain strong, and that the yield curve should continue to flatten (as a result of benign inflation keeping longer-term rates fairly low). Although our view is that the stock market will be at the mercy of more frequent mood swings, the secular bull market we believe began nearly six years ago should persist in 2015.

2014-12-21 Iceberg at the Starboard Bow by John Hussman of Hussman Funds

Market history, including the series of bubbles and crashes over the past 15 years, does not teach that valuation is irrelevant, but instead that a key distinction affects whether stability or instability is likely to prevail. When rich valuations are coupled with tame credit spreads and uniform strength across a broad range of market internals and security types, one can infer that investors remain tolerant toward risk. In that environment, risk premiums may be low, but theres no particular pressure for them to normalize, even if the speculation is driven by mindless yield-seeking.

2014-12-21 European QE Draws Attention to Irish Bonds by John Taylor and Dennis Shen of AllianceBernstein

Europes bond markets are starting to focus on the potential impact of ECB sovereign-bond purchases. While we expect QE to prompt a further narrowing of peripheral European sovereign-bond spreads, its important to stay focused on country fundamentals when selecting exposure.

2014-12-21 Weekly Market Summary by Urban Carmel of The Fat Pitch

On balance, there seem to be good reasons to expect the indices to trade higher over the next two or three weeks. This period also corresponds to the holidays.

2014-12-20 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

I recently revisited the economic projections we made last January, as part of my performance appraisal. I dread the experience, as it tends to highlight my frailty as a forecaster. This year wasnt too bad, though. Allowing for the polar vortex, we got U.S. growth just about right. We had been skeptical about Europe, and thought that China would moderate. Our call on how the Federal Reserve would progress was spot on. However, a number of things that transpired during 2014 caught us quite by surprise. Here is our roster of the most unexpected events and trends of the year.

2014-12-20 The $330 Billion Global Tax Break by Frank Holmes of U.S. Global Investors

According to an article by Jon Markman titled The Saudi Stimulus, the global economy is looking to save hundreds of billions of dollars on an annual basis: "According to EIA data, consumption of crude oil during the latest 12 months was 6.9 billion barrels. So the price drop from $107/barrel at the June 2014 high to $59 today represents a total presumptive savings of $332 billion per year." In a time when China, the European Union and other major markets are trying to jumpstart their economies, a $330 billion tax break can only come as good news. It should help in stimu

2014-12-20 The Lessons of Oil by Howard Marks of Oaktree Capital

I want to provide a memo on this topic before I and hopefully many of my readers head out for year-end holidays. Ill be writing not with regard to the right price for oil about which I certainly have no unique insight but rather, as indicated by the title, about what we can learn from recent experience.

2014-12-19 Tempting TIPS by Anthony Valeri of LPL Financial

Lower inflation expectations as a result of falling oil prices have weighed on TIPS prices during the second half of 2014. TIPS underperformance has led to the lowest market-implied inflation expectations of the past four years. We do, however, find TIPS an attractive high-quality option and certainly more appealing than Treasuries as a result of recent underperformance.

2014-12-19 A Rising Tide Lifts Most Boats by Saumil Parikh, Daniel Ivascyn of PIMCO

PIMCO expects global growth to accelerate in 2015, reaching about +2.75% year-over-year, with the majority of this improvement due to the (predominantly supply-driven) decline in oil prices. However, there will be large differences in growth dynamics among countries. While fiscal and monetary policies in most developed countries will stimulate growth in 2015, the U.S. Federal Reserve will attempt to break from the pack.

2014-12-19 Solar Growth Not Impacted by Oil by Edward Guinness of Guinness Atkinson Asset Management

The recent fall in the oil price has caused the share prices of solar stocks to fall. This fall is indicative of a growing negative sentiment towards energy investing, but it is not supported by rational analysis of the economics of the solar industry.

2014-12-19 The Promise of Smart Beta by Jason Hsu of Research Affiliates

Forty years ago, Jack Bogle helped revolutionize our industry for the benefit of the investor. Today there is opportunity for a second revolutionpromising to bring the same low costs and high transparency to additional equity factors. Can smart beta break free from the conventional objectives of asset gathering and obfuscation, and deliver on that promise? Jason Hsu provides his commitment and reasserts that of Research Affiliates to deliver on the promise of smart beta.

2014-12-19 Testing the Limits of Monetary Policy Without Fiscal Union by Andrew Balls, Andrew Bosomworth, Lorenzo Pagani of PIMCO

Over the next 12 months, we expect eurozone growth to accelerate from the current annualised run rate of 0.5% to a still-very-weak pace of approximately 1%, while the ultra-low inflation tells us there is a demand problem. With the ECB set to expand its balance sheet over the cyclical horizon, the biggest risk to growth is if the ECB buys large quantities of government bonds but the governments do nothing. We expect to remain overweight European peripherals and overweight European corporate credit, with the focus on financials.

2014-12-19 Outlook for the Global Credit Markets in 2015 by Mark Kiesel of PIMCO

The combination of fundamentals, technicals, valuations and global central bank policies drives our overall constructive outlook for global credit in 2015. Economic growth dynamics, including an improving outlook in the U.S., along with likely changes in global central bank policies, continued energy price volatility and the potential for more shareholder-friendly actions by companies inform our credit views and strategies.

2014-12-19 Valuation estimate of SP500 2015 returns : 2,246 target by Dwaine Van Vuuren of

The RecessionALERT Valuation Index (RAVI) is a multifactor valuation model that examines cyclically adjusted trailing SP-500 earnings (various multi-decade horizons), the SP-500 total-return index level, total stock market capitalization, Gross Domestic Product, non-financial corporate equities and liabilities, non-financial corporate business net-worth and percentage of investors allocation to stocks versus cash and bonds to determine 10, 5, 3, 2 and 1 year forecasts for the SP-500 Total Return Index (dividends re-invested).

2014-12-19 Will 2015 Remain a Central Bankers World? by Andrew Pease of Russell Investments

Central bankers have dominated the outlook for global markets for the past five years. Theyve lowered interest rates to zero and implemented unorthodox policies like quantitative easing and forward guidance.

2014-12-19 Will Shoppers Bring Holiday Cheer for Markets? by Burt White of LPL Financial

We expect holiday shoppers, bolstered by lower energy prices, to help support potential stock market gains. Although the severity of the oil price decline has been unsettling, we view the decline as positive for U.S. consumers overall. Retail stocks should deliver some cheer for markets this holiday season, but dont stuff those stockings with too much of them.

2014-12-19 5 Things To Ponder: Variegated Contemplations by Lance Roberts of Streettalk Live

Yes, it is that magical week leading up to Christmas and the subsequent low volume push into the new year. For individuals, it is "magic time" as hopes are high that "Santa Claus" will come to WallStreet.

2014-12-18 Tempting TIPS by Anthony Valeri of LPL Financial

Lower inflation expectations as a result of falling oil prices have weighed on TIPS prices during the second half of 2014. TIPS underperformance has led to the lowest market-implied inflation expectations of the past four years. We do, however, find TIPS an attractive high-quality option and certainly more appealing than Treasuries as a result of recent underperformance.

2014-12-18 Will the European Union Reindex Stock Markets to 100 points? by Wim Grommen of Transfer Solutions

The introduction of the euro brought the citizens of Europe many advantages, including uniformity. It would be nice if that uniformity also applied to the comparison of the various stock exchanges. An index point is not a fixed unit in time and does not have any historical significance, so the European citizen may therefore not attach any significance for the future. Comparing index points to their history and also comparing the various stock exchanges makes no sense. The time is ripe to reindex European stock exchanges to 100 points.

2014-12-18 2015 Investment Outlook: US Credit Cycle Tiptoes into Middle Age by Eric Takaha of Franklin Templeton Investments

Eric Takaha, SVP, Franklin Templeton Fixed Income Group, discusses how far the US economy is in the credit cycle and the potential effects of rising rates.

2014-12-18 Does Victory For Abe Mean Defeat For The Yen? by Dennis Rhee of AdvisorShares

Prime Minister Shinzo Abe prevailed on Sundays snap election which will give Abe a fresh mandate to implement his policies to revive Japan from its prolonged well chronicled economic malaise. There was no way Abenomics wasnt going to continue since Abes LDP party had 352 candidates to the opposition Democratic Party of Japan fielding only 198 candidates for the 475 seats up for grabs.

2014-12-18 Why We Expect Japan to Regain Favor with Investors by Robert Sharpe of Heartland Advisors

Despite the consensus view that Japanese stocks are inexpensive, investors have generally avoided the space, perhaps because Japan has disappointed in the past. We think the tide is about to change, and Portfolio Manager of the Heartland International Value Fund Robert C. Sharpe explains why.?

2014-12-18 When is a Turnaround Not Really a Turnaround? by Austin Hawley of Diamond Hill Capital Management, Inc.

Like all good students, we try to learn from the experience of experts, and amongst value investors there is no more esteemed expert than Warren Buffett. We have followed Buffett closely, sending dozens of employees to Berkshire Hathaway annual meetings and scouring past letters to shareholders in search of value investing knowledge. Thus, we pay heed when Buffett warns that the temptation to predict a turnaround is often misguided.

2014-12-18 Touching Base on the Commercial Real Estate Recovery by Ian Goltra of Forward

Considering the recent upswing in commercial real estate prices and traded real estate stocks, in what inning is the commercial real estate recovery? Could there be extra innings? Prior to the most recent decline in real estate, downturns in commercial real estate cycles have historically been caused by supply shocksdevelopers putting up new buildings until they (or their banks) ran out of money.

2014-12-18 Rate Hikes To Start in 2015 by Brian Wesbury, Robert Stein of First Trust Advisors

Unlike most meetings, todays actions by the Federal Reserve were chock full of implications for the future course of monetary policy. At long last, the Fed finally removed the language in its statement that short-term interest rates will remain at essentially zero for a considerable time and replaced it with language that the Fed will be patient before starting to increase rates.

2014-12-18 A Tale of Two Markets by Scott Minerd of Guggenheim Partners

A solid run of domestic data has set the United States apart from a beleaguered world.

2014-12-18 2014 Year End Letter by John Osterweis, Matt Berler, Carl Kaufman of Osterweis Capital Management

As 2014 comes to a close, we want to provide an update on the energy sector. Energy has been making headlines as oil prices have reached unexpected lows. As discussed below, while the decline in oil prices is creating volatility in the energy sector, we believe that there continues to be opportunity in this sector and that the low oil prices should prove beneficial to U.S. and global economic growth.

2014-12-18 Emerging Markets Trends: What’s Negative for One Market May Boost Another by (Article)

Volatility is a normal part of investing and in response long-term CEF investors may see opportunity, says Alexander Reiss of Stifel, Nicolaus.

2014-12-18 Senior Loan CEFs Featuring John Cole Scott by (Article)

“Unloved” senior loan closed-end funds may appeal to CEF investors concerned that interest rates may rise, says John Cole Scott of CEF Advisors.

2014-12-18 Volatility Response Featuring Alexander Reiss by (Article)

Volatility is a normal part of investing and in response long-term CEF investors may see opportunity, says Alexander Reiss of Stifel, Nicolaus.

2014-12-17 Where Did The New Middle Class Citizens Go? by William Smead of Smead Capital Management

The "well known fact" with regards to oil over the last decade read like this: because of huge GDP growth in emerging markets like China, there were going to be 400 million new middle class citizens born of uninterrupted prosperity; they were going to want all the autos, consumer goods, $10,000 watches and food that Americans have.

2014-12-17 If Corporate America Is Investing in Sustainability, Then Why Arent You? by Michael Marinus Young of AdvisorShares

Unfortunately, thirty seconds in an elevator or hallway is not enough time to build the case for sustainability. But here on AlphaBaskets, were afforded the space and time to better explain why Sustainability should matter to them, and you.

2014-12-17 Plunging Oil Prices Spark Fears of Global Recession by Gary Halbert of Halbert Wealth Management

Today, we touch on several bases. No doubt everyone reading this noticed that stocks tanked last week, and now seem to be moving in lockstep with oil prices. While consumers welcome cheaper gas and heating oil prices, there is a growing fear that the collapse in oil prices may be a harbinger of a global recession.

2014-12-17 The Median Stock Is Once Again Negative YTD by Team of GaveKal Capital

The median year-to-date performance in the MSCI World Index with two weeks of trading left is -1%. The median stock was up 20% at this point last year and was up 13% at this point in 2012.

2014-12-17 Are Bonds Really Less Risky than Equities? by Patrick Rudden of AllianceBernstein

Its practically an investing axiom that government bonds are much less volatile than equities. But that depends on how you look at it. In fact, our research suggests that income streams from stocks are actually much less volatile than those of government bonds.

2014-12-16 U.S. Housing: Still Room to Grow? by Milton Ezrati of Lord Abbett

Federal Reserve rate hikes or not, the fundamentals suggest the sectors slow, steady recovery likely will continue.

2014-12-16 Europe Flash PMI Better, Not Fabulous by Team of GaveKal Capital

While today's better than expected rise in the flash PMI indicator (black line) for the euro zone is a welcome surprise, it would seem that it will take quite a bit more improvement before we can reasonably expect substantial progress in the recovery of important metrics such as GDP or industrial production.

2014-12-16 More Turbulence Ahead? by Russ Koesterich of BlackRock

Stocks and other risky assets experienced particularly violent moves last week, and given uneven global growth and the impending tightening of U.S. monetary conditions, I think we are likely to see more turbulence ahead. As I discuss in my weekly commentary, there are two forces driving the volatility.

2014-12-16 Is the Grinch Stealing Investors Christmas? by Jerry Wagner of Flexible Plan Investments

It was 1957. My Mom settled down with my brothers, sister, and me and began to read. It was a book by one of my favorites, Dr. Seuss. Unless you have spent the time since then living in a van down by the river, youve either read the book (or had it read to you), seen the TV cartoon account (1966) or Jim Carrey in Ron Howards motion picture version (2000) of How the Grinch Stole Christmas! Even the song has been a hit!

2014-12-16 High Anxiety by Scott Brown of Raymond James

Federal Reserve policymakers meet this week to set monetary policy. The key concern is the timing of policy normalization. Officials may be anxious to begin lifting short-term interest rates, but they need to be very careful about managing market expectations. The risks of tightening too soon or too late are not symmetric and with the financial markets in turmoil, the Fed will not want to add to the level of anxiety.

2014-12-16 Please Make it Stop! by Jeffrey Saut of Raymond James

He said: Jeff, you sure were right in Thursday mornings verbal strategy comments when you said we should get a bounce following Wednesdays 90% Downside Day, but that that bounce should not hold and for the perfect set-up to occur for the Santa Rally would be to have the S&P 500 come back down and travel into the 2000 2010 level.

2014-12-16 Oil, Employment, and Growth by John Mauldin of Mauldin Economics

Last week we started a series of letters on the topics I think we need to research in depth as we try to peer into the future and think about how 2015 will unfold. In forecasting US growth, I wrote that we really need to understand the relationships between the boom in energy production on the one hand and employment and overall growth in the US on the other.

2014-12-16 Gundlach: Don't Fear Fed Tightening by Robert Huebscher (Article)

Throughout the post-crisis period, collective wisdom among market forecasters has held that interest rates would rise. But low rates have persisted, proving those prognosticators "dead wrong," in Jeffrey Gundlach's words. Gundlach, correctly contrarian in his interest-rate predictions, now believes the Fed will raise rates in 2015 but investors should not fear Fed tightening.

2014-12-16 How Much Risk Should Clients Take? by Joe Tomlinson (Article)

Determining the degree of risk that is appropriate and tolerable in clients' financial plans is central to an advisor's role. I will show how advisors should deconstruct risk into six components and then integrate them using a framework to provide the best recommendations for clients.

2014-12-16 Financial Planning for an Uncertain Energy Future by Richard E. Vodra (Article)

Advisors hearing optimistic forecasts of plentiful new supplies of oil that may last for decades may be encouraged to make aggressive projections for their clients. It is critical to understand the role oil plays in the economy and the factors that will affect future supplies. Advisors should "drill down" beneath the slogans to see both risks and opportunities upon which to base their recommendations.

2014-12-16 Why I'm Concerned about Stock Market Valuation Levels by Ron A. Rhoades, J.D., CFP® (Article)

Looking at a range of valuation metrics, long-term investors have good reason to worry about the U.S. equity market. They can take comfort, however, in the fact that certain asset sub-classes are less overvalued that others.

2014-12-16 Increase the Emotional Connection with Your Prospects by Daniel Solin (Article)

To convert prospects into clients, you need to make an emotional connection. Lecturing, educating, presenting data or otherwise demonstrating your superior expertise in financial planning and investments will not achieve that goal.

2014-12-16 The Top Priority for Growth in 2015 by Beverly Flaxington (Article)

What is the number one most important area to focus on for growth in 2015?

2014-12-16 Turning Resolutions into Reality by Dan Richards (Article)

I will outline the research on the tactics that go into creating the new habits that will turn your personal and business New Year's resolutions into reality.

2014-12-16 Allocating to Alternative Investment Strategies by Nathan Rowader of Forward

Following the market declines in 2008 and 2009, many investors have shown interest in alternative investment strategies such as hedge funds and mutual funds that employ hedge fund-like strategies. These types of strategies have been around a long time, but until recently their use among individual investors has been somewhat limited.

2014-12-16 Strategy Spotlight: An Update on PIMCO'S Fundamental Index-Based Product Suite by Sabrina Callin, Robert Arnott of PIMCO

The Fundamental IndexPLUS AR strategies combine the best of what passive indexing and active management aim to deliver: broadly representative, transparent equity exposure plus the potential for meaningful equity market outperformance.

2014-12-16 Busting the Myth About Size by Vitali Kalesnik, Noah Beck of Research Affiliates

Many market participants (including investors, product providers, and analysts alike) assume that, just as value stocks on average outperform growth, small-cap stocks on average outperform large-caps. Unlike value, however, and contrary to popular opinion, there is little solid evidence that stock size affects performance.

2014-12-16 Oil Price: Looks Reasonable by Brian Wesbury, Robert Stein of Fortigent

A former economic colleague, and mentor, used to say: In the Bible, it says an ounce of gold will buy a fine suit of clothing. We have read the Bible, and we havent found this, although there could be some high-powered math, using talents, cubits, frankincense and myrrh that make it true.

2014-12-16 An Interest Rate Hike? Check Out Long Bonds, US Dollar Index, Demographics And Money Multiplier. by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

Inflation is out of sight in terms of Treasury bond yields, dollar exchange rates and demographic outlook lets not even mention energy costs! Much of the FEDs monetary base expansion did not flow into consumption or, more importantly, entrepreneurial productive investments! Money multiplier is more like a fractional now, since not even credit increased the money available for Main Street the way it used to.

2014-12-15 Why Should an Investor Consider International Small-Caps? by (Article)

With approximately 25,000 international companies in our chosen asset class, we believe active management suits our search for businesses with the quality metrics that we typically look for in our domestic investments - high returns on invested capital, strong balance sheets, and sizable market shares.

2014-12-15 Are Energy Stocks Undervalued? by Mark Ungewitter of Charter Trust Company

Energy stocks have tumbled along with crude oil. But have they reached the bargain basement? This depends on one’s outlook for the price of crude. The performance of energy stocks relative to the broad market is well correlated with the underlying commodity.

2014-12-15 How to Approach the Alternative Investments Puzzle: Putting the Pieces Together by Walter Davis of Invesco Blog

Every summer my family and I go on a vacation to the beach. While there, my wife buys a big jigsaw puzzle for us to work on. Every year, we feel overwhelmed immediately after she dumps out all 1,000 pieces.

2014-12-15 Why Does Everyone Keep Asking Us About Great Value Buys in Europe? by Team of GaveKal Capital

While attending a conference last week and hearing questions and comments such as, "Europe's pretty cheap right now, isn't it?", "Where are you finding the best deals in Europe?", and "I bet you are finding a lot of value in Europe these days", we felt as though it might be appropriate/ necessary to quickly review where European valuations stand at the moment (short answer: the perception that an abundance of relatively inexpensive stocks may be found in Europe is largely misguided).

2014-12-15 A Sensible Proposal and a New Adjective by John Hussman of Hussman Funds

The FOMC is well-served by Richard Fishers proposal to consider terminating the current policy of reinvesting proceeds from Fed balance sheet holdings as those securities mature. That shift would not imply any rush to raise the federal funds rate or otherwise normalize policy rates.

2014-12-15 Falling Oil Prices Cause Jitters, but the Economy Stays on Track by Robert Doll of Nuveen Asset Management

The dominant financial story last week was the concern over the continued slide in oil prices, which have dropped close to 40% so far this year.1 Worries about the growing power of the Greek opposition party Syriza, and the potential effect on European policy should it assume control over the government, also contributed to investor unease.

2014-12-15 Black Gold Loses Glitter by Peter Schiff of Euro Pacific Capital

The stunning 40% drop in the price of oil over the past few months has scrambled global economic forecasts, changed the geo-political landscape, and has severely pressured many energy sector investments. Economists are scratching their heads to determine if the drop is good or bad for the economy or whether cheap oil will add to or decrease unemployment, or complicate the global effort to "defeat" deflation.

2014-12-14 Weekly Market Summary by Urban Carmel of The Fat Pitch

The question now is what lies immediately ahead. We think risk/reward on a one month basis is now positive.

2014-12-14 Weighing the Week Ahead: Will Crashing Oil Prices Change the Feds Course? by Jeff Miller of New Arc Investments

The investment conclusion is opportunity in non-energy cyclical stocks, including basic materials, technology, and consumer discretionary. There are also energy names that are part of the knee-jerk reaction, but which do not necessarily suffer from lower oil prices. These include refiners and some of the large integrated oil companies that need to replace reserves. (Barrons also suggests oil tanker stocks storage needed!)

2014-12-13 Glancing Back but Focusing Forward by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The US stock market appears set for further gains into at least the first half of next year, although risks are elevated with valuations no longer discounted and looming rate hikes. There is hope that ongoing easy monetary policy by global central banks can help to bolster economic activity is areas such as the Eurozone, China, and Japan. But we are somewhat skeptical about stock market performance in developed international countries and favor emerging markets to start out the New Year.

2014-12-13 China Wants to Conduct the World's High-Speed Rail Market by Frank Holmes of U.S. Global Investors

The Chinese want to return to the railroad business. This time, however, they strive to become the world?s leading go-to provider of high-speed rail and exporter of mass transit technology.

2014-12-13 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The Fed prepares to take a "considerable" step. We could be in for another round of emerging market volatility.

2014-12-13 Bulls, Bears and Pigs by Robert Isbitts of Sungarden Investment Research

So, the global stock markets have your attention. Whether you are focused on declining economic prospects in Europe, Emerging Markets weakness or the recent slide in the U.S. stock market, we are all forced to contemplate something that may now be driving up beside us, not merely in the rear-view mirrora stock bear market.

2014-12-12 Measuring Tactical Alpha by Adam Butler of Dundee Goodman Private Wealth

We are big fans of active asset allocation, which is sometimes called tactical alpha. Our enthusiasm stems from the following observations from our own research, and from other published sources.

2014-12-12 Energy Sector Woes Continue to Weigh on Market as Risks of Default Increase by Chris Puplava of PFS Group

Energy prices have collapsed with unwinding of massive net-long positions. Weak demand and rising supplies also weighing on the sector. Slide in prices puts debt of certain issuers at risk of default. Until we see signs of stabilization in energy credit markets, bottom to remain elusive

2014-12-12 Grandma Got Run Over By A Dividend Portfolio by Roger Nusbaum of AdvisorShares

Forbes had a very short article titled High Yield Grandma which offers a brief profile of a woman who has overcome a few setbacks and has a very substantial investment portfolio worth $3 million. As the clever title implies she focuses on dividend stocks.

2014-12-12 Examining the Correlation between Oil and Gold by Dennis Rhee of AdvisorShares

Crude Oil and Gold have generally exhibited a positive correlation (meaning they move in tandem) for the past 7 out of 10 years. In general both fall in the commodity asset class and are commonly used by investors as an inflation hedge as well as for portfolio diversification. As inflation increases, both commodities will tend to follow suit.

2014-12-12 Oil, Roil, and Turmoil by Scott Minerd of Guggenheim Partners

The free fall in oil prices is roiling markets. There are near-term benefits of lower energy prices, but darker clouds are gathering for the global economy.

2014-12-12 5 Things To Ponder: Crude Oppositeness by Lance Roberts of Streettalk Live

This past week I have been inundated with questions regarding the dive in crude oil prices and the energy sector in general. Is this a fantastic buying opportunity, or is the bigger of something bigger? The answer depends on your time frame.

2014-12-12 Asia, Looking to 2015 and Beyond by Robert Horrocks of Matthews Asia

Over the next decade, I expect Asias econo-mies to continue to raise living standards and to narrow the income gap between its own citizens and those in the U.S. or Europe.

2014-12-12 Europe: Look for Value, Expect Volatility by Russ Koesterich of BlackRock

Greeces ruling coalition is at risk of losing its grip on power, which sent the countrys stocks and bonds dramatically down. Is this the beginning of another Greek crisis?

2014-12-12 Measuring Tactical Alpha Part II: Examples and Analysis by Adam Butler of Dundee Goodman Private Wealth

When we left off in Part 1, we promised to examine how select Global Tactical Asset Allocation products stack up against the Global Market Portfolio from the perspective of several performance measures particularly Sharpe ratio, alpha and information ratio. Without further adieu:

2014-12-12 5 Things To Ponder: Crude Oppositeness by Lance Roberts of Streettalk Live

This past week I have been inundated with questions regarding the dive in crude oil prices and the energy sector in general. Is this a fantastic buying opportunity, or is the bigger of something bigger? The answer depends on your time frame.

2014-12-11 OPECs Thanksgiving by Jonathan Waghorn of Guinness Atkinson Asset Management

The Organization of the Petroleum Exporting Countries (OPEC) meeting ended on 11/27/14, Thanksgiving Day, with the decision to leave their production quota unchanged and no clarity on when a cut might be forthcoming. The lack of any quota cut, combined with little indication that OPEC were particularly focused in the short term on quota compliance, caught the market by surprise. Crude oil prices and energy equities fell sharply.

2014-12-11 Favorable Policy Environment for Stocks in 2015 by Burt White of LPL Financial

We expect the policy environment in 2015 to be supportive for stocks. The transfer of power to Republicans may have a meaningful impact on broad policy measures. Regardless of the political party in power, the year before the presidential election has historically been a good one for stocks.

2014-12-11 10 Legendary Investment Rules From Legendary Investors by Lance Roberts of Streettalk Live

I live in Houston, which has been a huge economic beneficiary of the sustained increases in oil prices, drilling, refining and related processes. As such, the amount of wealth created in energy-related investments has been enormous and, not surprisingly, a vast majority of individuals have overweighted portfolios in energy with the expectations that "oil prices can only go up."

2014-12-11 Global Carry Is Correcting by Alexander Giryavets of Dynamika Capital L.L.C.

The day after Thanksgiving we noted that Global Carry has gone parabolic and needs to be watched carefully. It has been mildly correcting since and we encourage investors to stay cautious. We also review where we stand in terms of Risk On/Risk Off factor.

2014-12-11 Inequality and the American Child by Joseph Stiglitz of Project Syndicate

Though an average American childhood may not be the worst in the world, the disparity between the country's wealth and the condition of its children is unparalleled. And, without compensatory measures, unequal opportunities translate into unequal lifelong outcomes by the time children reach the age of five.

2014-12-11 The Fed, Jobs, and the Financial Markets by Scott Brown of Raymond James

Looking ahead to 2015, the labor market is expected to play the key part in the Feds path to policy normalization. However, as we learned from New York Fed President Dudley last week, the Fed will also consider the reaction in financial markets.

2014-12-11 Quote of the Week by Jeffrey Saut of Raymond James

As most of you know I was in New York City most of last week seeing institutional accounts, doing media and speaking at various events. One of the media appearances was to co-host CNBCs Closing Bell on Tuesday, with the sagacious Sara Eisen, who unsurprisingly gave me the quote of the week. The quote was, Think of it this way, lower oil prices are to America what lower labor costs were to the BRICs!

2014-12-11 Three Winning Arguments for Japan by Russ Koesterich of BlackRock

I travel to Japan every year, normally around early December. The more time I spend there, the more I come to realize what a uniquely distinct country it is. On my trip last week, one of my Japanese colleagues pointed out that Tokyo was starting to allow taller office buildings. I assumed the previous limitation was a function of Japans location in a geologically active part of the Pacific. My friend politely laughed. The injunction was due to the fact that no building was supposed to look down on the Imperial Palace.

2014-12-11 European Small-Caps: Focus on Companies, Not Countries by Liliana Castillo Dearth, Alan Connery of AllianceBernstein

Growth in the euro area has slowed sharply, but thats not true for all companies in the region. We think worries about Europes recovery may offer investors the chance to buy quality, small-cap stocks for less than they would pay for similar-caliber companies elsewhere.

2014-12-10 2015 Year Ahead: Continuing to Deflate the Global Credit Bubble by Richard Bernstein of Richard Bernstein Advisors

Stock market leadership virtually always changes when volatility significantly spikes, and the 2008 bear market was no exception. Credit-related asset classes led the markets for the decade prior to 2008 as the global credit bubble inflated. Since 2008?s bear market, however, leadership has significantly changed and credit-related asset classes have generally underperformed plain, old-fashioned stocks.

2014-12-10 Interest Rates Have Nowhere To Go But Up? by Lance Roberts of Streettalk Live

Earlier this week Daniel Druger and Liz McCormick wrote an article for Bloomberg entitled: "One Hundred Years Of Bond History Means Bears Destined To Lose." The premise here is simple. With interest rates near their lowest levels on record, they have nowhere to go from here "but up." This is the consensus of virtually all of the analysts and economists on Wall Street which currently suggests that rates will rise to 3.88% next year on the 30-year treasury.

2014-12-10 Dealing with Divergence by Russ Koesterich of BlackRock

From the Age of Recovery to the Age of Divergence, we look forward to 2015 with an overview of the investment world and explore the different themes that will matter in the New Year.

2014-12-10 Whos Really in The Kingdoms Gun Sights? by Doug Holt of AdvisorShares

According to the EIA, U.S. crude oil imports averaged about 7.3 million barrels per day last week with Canadian barrels making up 3.2 million barrels of the total. U.S. commercial reserves increased by 1.9 million barrels week over week where total inventories fell 3.7 million barrels versus expectations of a build of 950,000.3 Are we at the beginnings of a rebalancing of the market? Possibly.

2014-12-10 Follow the ECB Compass by Eve Tournier of PIMCO

As the European Central Bank continues to expand its balance sheet to counter low growth and ?low inflation, we believe European duration should remain relatively well-anchored and European assets should be well supported. Looking ahead, in a world of low yielding European core rates, we believe credit will continue to attract investors. We continue to see spread compression opportunities in peripheral sovereign, fundamentally improving banks and high yield.

2014-12-10 November Jobs Report Wasn't So Great After All by Gary Halbert of Halbert Wealth Management

Last Fridays unemployment report for November was a stunner, at least on the surface. US businesses ramped-up hiring across the board in November, putting 2014 on pace to be the best year for job growth since 1999.

2014-12-10 A Point-and-Figure Perspective on Ratings Upgrades by Team of GaveKal Capital

Faithful followers will already know that we do not rely on meetings with management or analyst reports in our methodology for finding the world's best knowledge leaders. And, while we have developed a more objective, data-driven process, it is always interesting to at least take a look at how our various tools compare with the consensus from the street.

2014-12-10 Lessons Learned in 2014 by Seth Masters of AllianceBernstein

In 2014, US stocks forged ahead, international developed and emerging-market stocks lagged, bonds did better than expected, and the IRS took a bigger bite. Here are some lessons for US investors to carry forward into 2015.

2014-12-09 Jeremy Grantham's Favorite Book by Michael Edesess (Article)

Jeremy Grantham has long advocated that economic growth is inexorably constrained by physical resources, especially oil and other fossil fuels. Thus, in his quarterly letter, he writes, "I think that the old growth rates in productivity will not come back, at least until we have had a transition away from fossil fuels." But Grantham also gratefully notes that "a new book appears that amazes me by doing the opposite, and by an increasingly well-known economist no less - It is entirely sensible from start to finish - I agree with almost everything he writes."

2014-12-09 The Hidden Value of a Reverse Mortgage Standby Line of Credit by Wade Pfau (Article)

Recent research has investigated how opening a standby line of credit through a reverse mortgage and strategically spending from this line of credit can help improve the sustainability of retirement income strategies. In this article, I show that the benefits of opening a home-equity conversion mortgage (HECM) line of credit extend beyond meeting spending needs.

2014-12-09 Is Discipline Over-rated? by Dan Richards (Article)

What some advisors need is not more discipline, but new habits around tasks like email. There's growing research surrounding how discipline works.

2014-12-09 The New Credential That Will Increase Your AUM by Daniel Solin (Article)

Advisors spend an enormous amount of resources developing their knowledge in various areas of wealth management. Some of the credentials they obtain reflect years of study. Currently, however, no one has the "ME" credential, and for good reason.

2014-12-09 Capital Gains and Losses - Timing Is Everything! by Glenn Frank (Article)

This article will lend insight into one of the few areas that investors actually can control in our new American Taxpayer "Relief" Act environment.

2014-12-09 How to Deal with Unresponsive Clients by Teresa Riccobuono (Article)

We all have clients who, for whatever reason, become unresponsive to our calls and emails. Here's a process that will address those unfortunate situations.

2014-12-09 Developing Growth Plans for 2015 by Beverly Flaxington (Article)

Every year we talk about formalizing our client referral process, increasing our market presence and setting other growth-related goals. But we start January 1 without real plans in place. What can we do this December to ensure we are successful with our resolutions?

2014-12-09 Germany and France: Looking for Quality in the Eurozone by Jim Harvey, Dilip Badlani of The Royce Funds

While concerns over economic growth in Europe have been escalating, Royce International Micro-Cap Fund Portfolio Managers Jim Harvey and Dilip Badlani are finding small-cap opportunities with long-term benefits.

2014-12-09 A Year of Divergence by Mohamed El-Erian of Project Syndicate

In the coming year, the global economy will be characterized by widening discrepancies in economic growth and policies. As these divergences become increasingly difficult to reconcile, policymakers will either have to overcome the obstacles that have so far impeded effective action or allow their economies to become destabilized.

2014-12-09 Designing Balanced DC Menus: Considering Equity Investments by Stacy Schaus, Ying Gao of PIMCO

Defined contribution investment lineups typically provide numerous equity choices but still may lack adequate diversification and return potential. Participants may benefit by accessing high-growth markets such as emerging markets and tapping in to dividend-paying stocks. Retirement outcomes could improve further by including portfolios structured using fundamental measures rather than market capitalization.

2014-12-09 2015 Fixed Income Outlook: Handle with Care by Anthony Valeri of LPL Financial

With sustained improvement in economic growth, slowly rising inflation, and the approach of the Feds first interest rate hike, bond prices are likely to decline in 2015. High-yield bonds and bank loans can help investors manage this challenging bond market.

2014-12-09 Stocks: Going with the Flows by Milton Ezrati of Lord Abbett

Mutual-fund data show that retail investors remain reluctant to commit money to equities. That actually could help extend the rally in the months ahead.

2014-12-09 Who Should Go to the Bowls? by Jerry Wagner of Flexible Plan Investments

When I was a kid there were just four year-end college football bowl games. Today there are 39. Perhaps the title of this piece should be Do we need holiday football bowls at all? But I guess they wouldnt produce them unless there was a demand for them from the cities, hoping to get some travelers, to the sponsors, hoping to get some attention, to the teams, seeking to cap a successful season, and to the fans, who are just looking to have some fun and experience a last hurrah for this years heroes.

2014-12-09 Pushback: The Gift That Keeps on Giving by William Smead of Smead Capital Management

We have been out on the road telling the story of Smead Capital Management and explaining our portfolio of common stocks. One of the many benefits of these meetings is the feedback we get from existing investors, potential investors, the financial media and other interested parties.

2014-12-09 An Improving Economy Justifies a Pro-Growth Investment Stance by Robert Doll of Nuveen Asset Management

U.S. equities advanced again last week with the S&P 500 Index climbing 0.4%, extending its winning streak to seven weeks. Investors responded well to improving economic data and focused on the positive aspects of declining oil prices. In China, equities moved sharply higher and notched their best weekly performance in seven years as investors speculated that Chinese officials were on the verge on enacting additional policy support.

2014-12-09 Room to Run for the Stock Market by Steve Blumenthal of CMG Capital Management Group

Last week Bill Gross and the former co-CIO of PIMCO, Mohamed El-Erian, were advising clients to lighten up on stocks. You may agree that these are certainly two people with a passion for what they do. To that end, we all benefit.

2014-12-09 Data Driven or Driven Data by Peter Schiff of Euro Pacific Capital

There can be little doubt that data releases rather than experience or intuition are driving the economic conversation. This is perhaps a function of the disconnection that many people feel about an economy that they no longer understand.

2014-12-09 Hungary's PM: Madman or Geopolitical Genius? by Kaisa Stucke of Confluence Investment Management

Hungarys Prime Minister Viktor Orban is one of the first European leaders to turn friendly toward Russia, noting that geopolitics are changing and Eastern European countries should redefine their international policies according to these changes. This report explores the differences between the rules of the geopolitical game being played by Hungary, the West and Russia. We will describe the history of Hungarys balancing act between the powers of the East and West and how this history affects its current politics. We will discuss the most likely outcomes and their international si

2014-12-08 Portfolio Replenishing During Bull Markets by (Article)

Royce Opportunity Select and Opportunity Fund Portfolio Manager Bill Hench talks with Principal Dave Gruber about his buying and selling process, which—while more difficult to maintain during up-market periods—remains consistent regardless of market movements.

2014-12-08 Peaking Process by John Hussman of Hussman Funds

In my view, we are likely witnessing the peak of the third equity valuation bubble in the past 14 years, the first two which saw major indices plunge by at least 50%. Its important to recognize that market peaks are a process, not an event. Internal deterioration has actually been developing since early July, and became measurable in early August. This process has been quite like what we observed in 2007, when deterioration became measurable in July of that year. Despite an initial selloff, the major indices recovered to a marginal new high in October 2007 before continuing lower.

2014-12-08 The Big Squeeze Begins by Michael Story of PIMCO

Current European Central Bank policies, along with the regulatory environment, are constricting the two primary investment vehicles available to store cash. As many money market funds have maxed out the risk they can take and some regional European banks have started to charge the equivalent of negative rates on deposits, large cash investors are left to ponder how to avoid the potential loss of capital. We believe PIMCO's approach to balancing three key cash management trade-offs may provide an attractive solution for investors.

2014-12-08 The All Everything Portfolio? No Such Thing by Roger Nusbaum of AdvisorShares

Barry Ritholtz has had some good fun torching Tony Robbins All Weather Portfolio for having too much in bonds and commodities as well as being to backward looking and being put forth as a one size fits all. The latest was in his WaPo column dated December 5, 2014.

2014-12-08 Ramping Up Reform in Brazil by Rick Harper of WisdomTree

On November 27, President Rousseff shook up her cabinet through the appointment of Joaquim Levy as finance minister. In our opinion, this marks a positive first step by the administration in its attempt to re-establish its credibility with the market.

2014-12-08 A Long-Term View for China by Nick Niziolek of Calamos Investments

When I meet with clients, one of the most frequent questions Im asked is, What do you think about China? With Chinas rate cut this past Friday helping to fuel a global equity rally, we were reminded of how relevant the China question is to the overall health of the global markets and economy. In this post, Ill discuss the lens through which we view China and how we interpret the daily flood of policy-related headlines coming out of the country to determine what is noise and what is actionable.

2014-12-08 Are You Prepared for Short-term Rates to Rise? by Craig Brandon of Eaton Vance

In this timely Q&A, Craig Brandon, portfolio manager of Eaton Vance Floating-Rate Municipal Income Fund, offers his thoughts on the asset class, how he manages the Fund and which investors may find the strategy attractive.

2014-12-08 Inflection Points by Guy Scott of Janus Capital Group

U.S. equities surged over the last six years as the economy regained its footing after the financial crisis, and companies underwent substantial cost cuts to improve profitability. Today, many international companies and regional economies are early in the process of making similar positive, transformative changes.

2014-12-08 Go for the Gold: Commodities and Inflation by Denis Chaves of Research Affiliates

Unexpected inflation would be especially damaging to portfolio returns when asset class yields are low, but a modest amount of inflation protection can substantially mitigate the risk. Commodities can be effective hedges against inflationary shocks.

2014-12-07 Macroeconomics Finally Gets Interesting by John Mauldin of Mauldin Economics

2015 may be the year that macroeconomics really becomes interesting again, if it hasnt already. After a long period of relatively coordinated central bank policies and remarkably low volatility, the macro scene is becoming more dynamic. Thats great for those who live and die by dramatic long-term shifts in global markets, but it should be terrifying for emerging-market policymakers, currency carry traders, Texas oil men, and, frankly, the average investor. King Volatility is back on his throne.

2014-12-06 Dont Let Market Motion Sickness Keep You From Missing the Boat by Frank Holmes of U.S. Global Investors

Despite all of the good news, the recent threat of market volatility, which weve seen plenty of in commodities and emerging markets, seems to have pushed close-to-retirement folks away from equity securities. The August and October downturns, not to mention the decline in gold and oil prices, have understandably heightened consumer fears.

2014-12-06 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Oil isn't the only commodity enduring a significant correction; The European Central Bank moves closer to QE; The U.S. is nearing full employment, but inflation holds the key to monetary policy

2014-12-06 Will Two Key Sectors Survive Chinas Long Landing? by Hayden Briscoe of AllianceBernstein

Based on insights from our teams recent trip to China, we noted that the country is likely headed for a long economic landing. What does that mean for its infrastructure and commodity sectors?

2014-12-06 Five Ways to Tackle Risk in Emerging Equities by Nelson Yu and Morgan C. Harting of AllianceBernstein

Emerging-market (EM) equities are far more turbulent than their developed-world peers. But there are several things investors can do to capture the attractive return potential while reducing volatility. Staying active is the lynchpin for success.

2014-12-06 Chinas Economy Gliding into Long Landing by Hayden Briscoe of AllianceBernstein

Chinas economy isnt headed for a hard or soft landinginstead, its more likely to be a long landing. Thats our perspective, based on our teams recent visit to China to get an up-close look at the economic landscape.

2014-12-06 Dont You Worry bout a Thing: Tell That to Individual Investors! by Liz Ann Sonders of Charles Schwab

Some attitudinal measures of investor sentiment show troublingly high levels of optimism. Longer-term sentiment surveys that separate individuals from institutions show something much, much different. These longer-term surveys suggest theres little risk that the wall of worry the market likes to climb is crumbling.

2014-12-06 Revisiting a YouTube Classic by Robert Isbitts of Sungarden Investment Research

Back in the summer of 2011, a short animated film was built using a website called XtraNormal. The site allows anyone to create a film and chose animated characters and voices. This one particular film sought to educate (with the creators strong opinions included) the audience on the Federal Reserves Quantitative Easing (QE) program, which then was in its middle stages. And boy, did it find an audience, with over 5 million people viewing it!

2014-12-06 Five Things To Ponder: Unstoppable Force Paradox by Lance Roberts of Streettalk Live

As we enter the final month of the year, the markets advance got me thinking about something known as the "Unstoppable Force Paradox." While you may not be familiar with the name, you will certainly know the definition which questions "What happens when an unstoppable force meets an immovable object?"

2014-12-06 China's One-Child Policy by Andy Rothman of Matthews Asia

Last November, Chinas Communist Party announced that it would relax its famed one-child policyone of the most draconian examples of government social engineering ever seen. This is a significant political move, as it represents the Partys decision to withdraw from its citizens bedrooms, restoring a key element of personal freedom that should help rebuild peoples trust in the Party. But what some observers may not realize is that the steepest fall in Chinas total fertility rate (the average number of live births per woman) actually came be

2014-12-06 Draghi Crosses the Rubicon while Juncker Peddles "Europhemisms" by John Beck of Franklin Templeton Investments

The announcement by newly installed European Commission President Jean-Claude Juncker of a package designed to secure 315 billion of investment for the eurozone garnered a lot of press interest in late November. However, John Beck, director of Fixed Income, London, and portfolio manager, Franklin Templeton Fixed Income Group, believes a speech by European Central Bank (ECB) President Mario Draghi at a bankers conference in Frankfurt earlier in the month offers more practical insight for investors. Here he outlines lessons to take from Draghis speech in the lions

2014-12-06 Weekly Market Summary by Urban Carmel of The Fat Pitch

Coming into this week, SPY had been above its 5-dma for 30 days in a row. This was a new record, unlike any streak the index has ever seen. We reviewed prior examples of these streaks earlier; our conclusion was that the streak rarely marked the top in the market, meaning there were higher highs immediately ahead after the streak ended. But the index also struggled in the following weeks, often trading lower.

2014-12-06 Sources of Investment Power: Why Expertise Matters and What it Looks Like by David Robertson of Arete Asset Management

There is a wide dispersion of ability in the investment services industry which makes it difficult to identify expertise. This is a shame because expertise is a critical factor in making good decisions and in avoiding bad ones. As the investment landscape becomes more difficult, it will become progressively more important to identify and access expertise.

2014-12-06 Weighing the Week Ahead: Time for a Santa Claus Rally? by Jeff Miller of New Arc Investments

The schedule for data releases is lighter than usual. The calendar year is about to end. The market continues to set records. The stage is set for the annual question: Will there be a Santa Claus rally in stocks?

2014-12-05 Outlook 2015: Multi-Manager by Marcus Brookes, Robin McDonald of Schroders Investment Management

Investors need to prepare for lower returns in the next few years, with a focus on capital preservation appearing prudent in the current environment.

2014-12-05 Getting More From Your Equity and Bond Benchmarks by Ryan Blute of PIMCO

Benchmarks have long served as a starting point, or anchor, for investors, representing the neutral point for an investment decision. They serve as the basic ingredients that combine to form an investors asset allocation and result in a desired risk/return profile.

2014-12-05 The Dark Side to Falling Oil Prices by Scott Minerd of Guggenheim Partners

The slump in oil prices could stifle global growth and force some oil-dependent economies into recession.

2014-12-05 Monetary Policy Outlook by Scott Brown of Raymond James

The minutes of the October 28-29 Federal Open Market Committee meeting suggested that there is still no consensus opinion among senior officials regarding when the Fed will begin raising short-term interest rates. There is strong agreement that monetary policy moves will be data-dependent. However, policymakers differ in their views on the amount of slack in the job market.

2014-12-05 2015? by Jeffrey Saut of Raymond James

Year-end letters are always difficult to write because there is a tendency to discuss the year gone by, or worse, try and predict what is going to happen in the New Year. I mean really, at this time last year who predicted Russia would invade Crimea, that ISIS would effectively take over a significant portion of Iraq, or the Republicans would sweep Congress.

2014-12-05 Right for the Wrong Reason by Tim Gramatovich of AdvisorShares

It has been a poorly kept secret that I am among the biggest skeptics in the planet as it relates to this whole US energy independence fantasy. As a credit investor, I have been no bid on the entire US E&P business. This was not an easy thing to sidestep as energy as a sub-set is by far the largest component of the various high yield indexes representing around 18%1.

2014-12-05 Three Reasons Why Municipal Bonds May Offer More Than Just Tax-Exempt Income by Stephanie Larosiliere of Invesco Blog

Tax-exempt income historically has been the main reason why investors buy municipal bonds. As a result of newer tax laws, including several provisions that expired at the end of 2013, tax bills for high-income earners have increased in recent years.

2014-12-05 A Mix of Central Bank Action and Oil by Russ Koesterich of BlackRock

Central bank action and plunging oil prices have been wielding big influence over market movements in recent months. Russ K explains why the impact is likely to continue.

2014-12-05 The Great Escape?? by Tony Crescenzi of PIMCO

Since the financial crisis, the Fed has engaged both conventional and unconventional tools in a colossal effort to smooth the deleveraging process, help put Americans back to work and boost wage growth. The Fed has achieved two out of three "escapes": 1) Escape from a liquidity trap: Get banks to lend. 2) Escape from quantitative easing: Stop the bond buying program. 3) Escape from the zero bound: Hike the policy rate above zero. Over the longer term, portfolios should be positioned for low policy rates not only in the U.S., but also in Europe and Japan.

2014-12-05 Is the Oil Price Slump an Early Holiday Gift for Some Consumers? by Virginie Maisonneuve, Ji Young Park, Mark Richards of PIMCO

With 60% of global GDP driven by consumers, the impact that sustained lower oil prices will have on the global economy is an important factor for investors to take into account. The benefits of lower oil prices will not be evenly distributed and it is important to think about countries that stand to benefit more because of higher consumption and/or less economic dependence on oil exports.

2014-12-05 Are Oil Prices Ready to Break out of the Trough? by Frank Holmes of U.S. Global Investors

American business holds up the rest of the world.In ancient Greek mythology, the Titan Atlas was charged with holding up the world. Today, that task largely falls on the shoulders of American businesses.

2014-12-05 Why OPEC Will Tolerate Cheap Oil by John Browne of Euro Pacific Capital

Despite falling oil prices, the Organization of Petroleum Exporting Countries (OPEC) voted on November 27th not to cut production in order to boost prices. The key to this decision appears to have been the attitude of Saudi Arabia, which has long been the first among equals in the coalition.

2014-12-05 Liquidity Factor Featuring Mariana Bush by (Article)

2014-12-05 Emerging Markets Featuring Rennie McConnochie by (Article)

2014-12-04 Young Adults Then and Now: A Perspective on the Millennials by Doug Short (Article)

The Census Bureau has released a fascinating new study on young adults today compared with previous generations. Among other things, we learn that today's 18-34 population numbers 73 million, about 23 percent of the total population compared to 30 percent for that cohort in 1980. Millennials today are more highly educated but have lower employment rates and are more likely to be living in poverty. They are also less likely to be married and more likely to be living with parents.

2014-12-04 Outlook 2015: Japanese Equities by Shogo Maeda of Schroders Investment Management

Strong corporate earnings growth and a weak yen should continue to provide support to Japanese equities in 2015.

2014-12-04 Exchange Rate 101: A Primer For International Investors by Bryce Fegley of Saturna Capital

A solid grasp of exchange rates and how they impact various asset classes can help international investors make better-informed decisions. The asset class most likely to be impacted negatively by a strengthening dollar is non-dollar fixed-rate bonds.

2014-12-04 OPEC Meeting Post-Mortem: All Eyes on U.S. Shale by Greg Sharenow of PIMCO

After averaging nearly $110 per barrel during the first half of 2014 and peaking at over $115 per barrel in June, Brent crude oil has fallen by over $40 in just a few short months.

2014-12-04 ISM Data for October and November Point to Strong U.S. Real GDP Growth in 2014 Q4 by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) released data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers, and the media as they provide the earliest reading on the current state of the economy.

2014-12-04 The Illusion Of Full Employment And Technology by Lance Roberts of Streettalk Live

Recently, Tim Duy wrote an interesting piece entitled "Yes, I am Optimistic" wherein he stated that: "The lesson no one wants to draw from this recovery is that the US economy is both stronger and more resilient than commonly believed. Do not dismiss the real improvement in the economy since 2009. It is not unimportant that 2014 is likely to be the biggest year for private sector employment..."

2014-12-04 What's Next for the Dollar and Gold? by Axel Merk of Merk Investments

Who would have predicted oil prices in the sixty-dollar range a year ago? Something is not right about these markets. Our take: dont get burned when markets add fuel to the fire. Heres what to watch out for as we head into 2015; ignore at your own peril.

2014-12-04 How Could They? by William Gross of Janus Capital Group

Punch and Judy fought for a pie. Punch gave Judy a sock in the eye. Said Punch to Judy, "Would you like any more?" Said Judy to Punch, "No my eye is too sore." Mother Goose nursery rhyme. Ah, nursery rhymes! Intended for kids no less! The above little ditty could serve as a modern day NFL domestic playbook, I suppose, while a century ago it was but one of many lesson plans on what not to do when you grow up.

2014-12-04 U.S. Economic Growth Picks Up by Team of LPL Financial

We believe the U.S. economy will continue its transition from the slow gross domestic product (GDP) growth of 2011 - 2013 to more sustained, broad-based growth. We expect the U.S. economy will expand at a rate of 3% or slightly higher in 2015, which matches the average growth rate over the past 50 years.

2014-12-03 Unintended Consequences of Staying Early Termination Rights by William De Leon, Tracey Jordal, Libby Cantrill, Courtney Walker of PIMCO

The topic of too big to fail has been an intense area of focus for policymakers and market participants, and for good reason: Everyone has a vested interest in avoiding a repeat of the 2008 financial crisis and its corresponding aftershocks.

2014-12-03 Commodity Bears (i.e., Everyone) Should Read This by Doug Ramsey of Leuthold Weeden Capital Management

The commodity "oversupply" story remains intact, with high levels of capital spending in the Energy and Materials sectors persisting, despite the 3 1/2-year downtrend in commodity prices. But for those wishing to buck that longer-term bearish trend, now might be an interesting time. The negative reaction appears disproportionate to the actual damage. Don't look for further substantial declines in commodity prices over the very short term, except perhaps in gold.

2014-12-03 Can Stocks Deliver the Goods in 2015? by Burt White of LPL Financial

We believe stocks will deliver mid- to high-single-digit returns in 2015. We expect earnings, and not valuations, to do the heavy lifting in producing potential stock market gains for investors in 2015. Monetary policy is in transit in 2015, when stocks will face a shift from the very loose monetary policy of the Federal Reserves (Fed) quantitative easing (QE) program to an environment in which the Fed begins to hike interest rates.

2014-12-03 On The Economy, Oil Prices & Obama's Temper Tantrum by Gary Halbert of Halbert Wealth Management

Last Tuesday the Commerce Department raised its estimate of 3Q Gross Domestic Product to a 3.9% annual pace from the 3.5% rate reported last month, reflecting upward revisions to business investment and consumer spending and a smaller than previously reported decline in inventories. The pre-report consensus was for a slight cut to 3.3%, so the latest report was much better than expected.

2014-12-03 Digging Deeper for Market Valuations by Robert McConnaughey of Columbia Management

Nobody buys a house without looking inside. And nobody should make investment decisions without doing their due diligence on the underlying fundamentals. But that is exactly what happens in an investment world increasingly driven by high-level asset allocation and utilization of passive, index-based products or strategies. Pundits look at aggregate index data and declare one country cheap (or some other action-inducing characteristic) vs. another. Maybe they are right, but maybe they are missing something too.

2014-12-03 Can Japan Reboot? by Kenneth Rogoff of Project Syndicate

Shinzo Abes recent policy decisions to increase monetary stimulus dramatically, to postpone a consumption-tax increase, and to call a snap election in mid-December have returned Japan to the forefront of an intense policy debate. The question is simple: How can aging advanced economies revive growth after a financial crisis?

2014-12-03 A Brave New World by Niels Jensen of Absolute Return Partners

In the the last two Absolute Return Letters I have argued why one should expect global GDP growth to be below average over the next decade or so, why interest rates should, as a consequence, remain low and why equity returns should also disappoint. Not as in negative returns but below the levels we have grown accustomed to over the past 30 years. If you have read those two letters, none of this should come as a surprise.

2014-12-03 Recession Probability Models - December 2014 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession. While I dont agree with the methodologies employed or probabilities of impending economic weakness as depicted by the following two models, I think the results of these models should be monitored.

2014-12-03 What the Swiss Gold Vote Means to the Capital Markets by Dennis Rhee of AdvisorShares

As expected, Swiss voters rejected a proposal Sunday to increase the Swiss National Bank (SNB) gold holdings to a mandatory 20 percent of its foreign exchange reserves. The Save Our Swiss Gold proposal was voted down by 77 percent to 23 percent which was a larger margin than what polls had indicated. The SNB had campaigned against this referendum initiated by the European Union-skeptic right wing Swiss Peoples Party which falsely argued that this would have strengthened the SNBs credibility.

2014-12-03 Outlook 2015: Convertible Bonds by Martin Kuehle of Schroders Investment Management

The equity market is likely to be the main driver of convertibles in 2015, when diligent research will once again be crucial.

2014-12-03 The ECBs Shifting Regimes by Andrew Bosomworth of PIMCO

The European Central Bank (ECB) is likely to commence a broad-based asset purchase programme, i.e., quantitative easing (QE), in the first quarter of 2015. As it stands, the eurozone is stuck in a liquidity trap, the risk of deflation is rising and inflation expectations are deviating from their long-term anchor. With the private sector deleveraging and the policy rate near zero, additional easing will require expanded asset purchases.

2014-12-02 In Defense of John Hussman by David Horn (Article)

John Hussman is a polarizing figure. The performance of his Strategic Growth Fund (HSGFX) is in the fourth, fourth and seventh percentile in one-, three- and five-year rankings, respectively. Worse, he's actually experienced a drawdown over the past six years. Much of that criticism, however, is misguided.

2014-12-02 The Tooth-Fairy Economics of Jeff Madrick by Laurence B. Siegel (Article)

Incentives don't matter, tradeoffs don't exist and there are no limits to what the government can give you. Those who believe this dogma are likely to still have faith in the tooth fairy. In Seven Bad Ideas, a critique of the neoclassical revival in economics that surrounded Milton Friedman and that affected policy and politics worldwide for more than a generation, Jeff Madrick emerges as tooth-fairy economics' chief exponent.

2014-12-02 Response to Larry Swedroe's Article, "How AQR's New Fund Adds Value" by Michael Edesess (Article)

In our November 18 issue, Larry Swedroe published an article titled "How AQR's New Fund Adds Value." His article was followed by a lively debate on APViewpoint. Michael Edesess took one side of that debate, in opposition to Swedroe, and his position is stated here.

2014-12-02 The Best Way to End Your Day by Dan Richards (Article)

Advisors frequently ask me for new ways to get referrals and attract clients. But here's the reality: what keeps advisors from moving forward isn't the lack of ideas - in fact most advisors are drowning in ideas. Instead, what keeps you from advancing your business is failing to act on the ideas you already have on your to-do list.

2014-12-02 A Second Look at First Impressions by Daniel Solin (Article)

What if a prospect makes a snap judgment that you are not trustworthy? How can you overcome that obstacle?

2014-12-02 The Danger of a Gossip-Monger by Beverly Flaxington (Article)

One of my colleagues thrives on gossip. She talks about each of us behind our backs, criticizing how we do everything. I want it to stop.

2014-12-02 Oil - Just Another Price by Brian Wesbury, Robert Stein of First Trust Advisors

Dont take this the wrong way: energy is important. Oil prices are important. But, we believeth those involved in economic punditry often bloweth them out of proportioneth.

2014-12-02 Strangers Passing in the Night by William Smead of Smead Capital Management

The economies of China and the United States appear to be headed in the opposite direction. Chinas economy is decelerating fast and the U.S. looks right on the cusp of having its economic growth accelerate, as evidenced by the revised quarterly GDP number of 3.9% released on November 25th, 2014.

2014-12-02 Learning From Mistakes Made By Pension Funds by Roger Nusbaum of AdvisorShares

Forbes took a look at How Pension Funds Make Investing Too Complex. The issue was hedge funds and private equity funds that tend to be expensive, opaque or both. These types of direct investments also tend to be illiquid in terms of having long waiting periods before investors can get their money out.

2014-12-02 Black Friday Hindenburg Omen Suggests Near-Term Caution by Chris Puplava of PFS Group

Given how extended the markets are and the near uninterrupted run since the mid-October lows, the recent Hindenburg Omen signals on the NASDAQ and Russell 2000 on Black Friday are likely warning of a coming pullback.

2014-12-02 The Evaluation of Common Stocks by Kendall Anderson of Anderson Griggs

I have met many financially secure families over the years. Most earned this financial security by working hard, while saving as much as possible, for a very long time. Some inherited a safety net, some married into wealth, and a few lucky people just did everything right at the right time. What I have not come across is anyone who gained financial security quickly in a short period by investing in the capital markets. I know there are a few of these wonder kids somewhere on the planet, but I havent met them.

2014-12-02 World Inflation Falls To 59-Month Low by Team of GaveKal Capital

All eyes seem to be on crude oil prices right now. Taking an average price of WTI and Brent as a proxy for global oil prices, oil is down over 33% year-to-date.

2014-12-02 Making Sense of Dollar Strength by Bradley Krom of WisdomTree

Over the last several months, investors and economists alike have started to take note of the broad-based appreciation of the U.S. dollar. However, we believe the magnitude of this years move tells only a portion of the story. In our view, this summers rally does not represent a correction or near-term adjustment, but rather the continuation of a broader trend that started in the middle of 2011.

2014-12-02 The Worlds Dumbest Idea by James Montier of GMO

In a new white paper today, James Montier of GMO's asset allocation team "explor(es) the evidence that shareholder value maximization (SVM) has been an unmitigated failure and contributed to some very undesirable economic outcomes."

2014-12-01 Current Opportunities Built from Short-Term Headwinds by (Article)

As bottom-up stock pickers who pay close attention to risk and valuation, we often see negative headlines as an opportunity to reevaluate our holdings and build our exposure to companies with long-term value at attractive entry points. Portfolio Manager Lauren Romeo provides her perspective on macro headwinds and how they affect our investment approach.

2014-12-01 Is Bitcoin the Future? by John Mauldin of Mauldin Economics

Worth Wray has written this weeks letter as a summary of what we know about Bitcoin. Delving into its history and bringing us up to date, he also offers a glimpse of the future. At the end of the letter I offer a few of my own thoughts on the relationships among gold, fiat money, Bitcoin, and financial transactions. If nothing else, Bitcoin offers a provocative way to think of the future of money.

2014-12-01 As Oil Falls, Indian Equities May Rise by Christopher Gannatti of WisdomTree

We believe that, as the price of oil falls, Indias economic growth prospectsand by extension, equity market performancemay improve.

2014-12-01 Global Carry Gone Parabolic? by Alexander Giryavets of Dynamika Capital L.L.C.

Global Carry has gone parabolic. Last such move precipitated the Taper Tantrum, only this time the parabolic move is exaggerated by US dollar appreciation.

2014-12-01 Quantitative Easing, Interest Rates, Real Yield Curves And Fedspeak...Get A Load Of That BULL! by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

People got it wrong, Quantitative Easing did not lower long-term interest rates. The Federal Reserves money printing actually halted the plunge of yields and cheapened bonds. Yields fell when other institutions showed their hunger for long bonds, and that suggests trouble ahead.

2014-12-01 The Dow Jones: Beautiful Tree in the Desert by Wim Grommen of Transfer Solutions

The Dow Jones Industrial Average (DJIA) Index is the only stock market index that covers both the second and the third industrial revolution. Calculating share indexes such as the Dow Jones Industrial Average and showing this index in a historical graph is a useful way to show which phase the industrial revolution is in. Changes in the DJIA shares basket, changes in the formula and stock splits during the take-off phase and acceleration phase of industrial revolutions are perfect transition-indicators.

2014-12-01 The Return of Currency Wars by Nouriel Roubini of Project Syndicate

The recent decision by the Bank of Japan to increase the scope of its quantitative easing is a signal that another round of currency wars may be under way. The cause of the latest currency turmoil is clear: In an environment of public and private deleveraging, monetary policy has become the only available tool to boost demand.

2014-12-01 Monetary Tectonics by John Hathaway of Tocqueville Asset Management

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX), examines in his latest piece "the very meaningful difference between the dollars relative and absolute strength, and look(s) at the widening fissures beneath the faade of strength fissures that, as yet, appear to have had little impact upon the investment consensus."

2014-12-01 Hard-Won Lessons and the Bird in the Hand by John Hussman of Hussman Funds

The S&P 500 is more than double its historical valuation norms on reliable measures (with about 90% correlation with actual subsequent 10-year market returns), sentiment is lopsided, and we observe dispersion across market internals, along with widening credit spreads. These and similar considerations present a coherent pattern that has been informative in market cycles across a century of history including the period since 2009. None of those considerations inform us that the U.S. stock market currently presents a desirable opportunity to accept risk.

2014-12-01 Black Friday Special: How Do The Retailers Look? by Team of GaveKal Capital

In honor of Black Friday, we thought we would look at how the North American retailers look from a technical perspective using our relative point and figure charts. Once again, our box size is 2.5% relative performance and all charts have four years worth of history.

2014-12-01 Worried About Year-End Capital Gains Taxes? ETFs May Help by John Feyerer of Invesco Blog

This is the time of year when asset managers announce year-end capital gains distribution estimates for their funds. Capital gains are generated when funds sell their holdings at a profit. Due to the solid performance of the markets this year, some investors may find their tax liabilities have grown along with their portfolio balance even if they havent sold their investments.

2014-11-29 Giving Thanks to the Innovators and Creators of Capital by Frank Holmes of U.S. Global Investors

Im grateful to live in a society that monetarily rewards such innovation and problem-solving, in addition to the intrinsic rewards entrepreneurs receive for improving the lives of others.

2014-11-27 Five Things To Ponder: Tryptophan Induced Coma by Lance Roberts of Streettalk Live

As we prepare for the annual food fest, and post-Thanksgiving tryptophan-induced food coma; I thought this weekend's reading list should be a bit of a smorgasbord of interesting topics to stimulate your brain cells between naps and football.

2014-11-27 Pick and Mix: Fresh Ideas for Diversifying Bond Exposure by John Taylor of AllianceBernstein

Policy backdrops and growth trajectories around the world are showing increasing signs of divergence. Yet many bond investors continue to congregate in a few selected pockets of the fixed income universe. In our view, its a perfect time to reconsider diversification tactics.

2014-11-27 Oil Price Wont Stay Low Forever by Kevin Simms and Jeremy Taylor of AllianceBernstein

If US$80 oil is sustained for a year or more, we think the impact on investment will be significant and the seeds of a future spike in oil prices will have been sown. In our view, its only a matter of time before the market begins to recognize thisand starts to push up oil prices again.

2014-11-26 The Tortoise and the ECB by Harley Bassman of PIMCO

It is curious that the ECB continues to slumber while the eurozones trading partners move steadily ahead. While not a certainty, it seems highly unlikely that the ECB will indefinitely allow its main trading partners to competitively devalue versus the euro. And since there is no reason to reinvent the wheel, Europes policymakers will likely unveil a familiar-looking and expansive QE policy designed to accelerate asset velocity and, in turn, reflate their equity market.

2014-11-26 Median Household Income Down Last 15 Years - Why? by Gary Halbert of Halbert Wealth Management

One of the most puzzling questions in economics today is why did median household income peak in 1999 and has yet to recover? Most analysts cite the fact that we had two serious recessions in the space of a decade, including the financial crisis of 2008-2009.

2014-11-26 Weekly Economic Commentary by Team of Northern Trust

Someone observed recently that the holidays are starting late this year, as the time between Thanksgiving and Christmas is shorter than usual. You could have fooled me; judging by store displays and TV advertising, the commercial side of the season is already two months old.

2014-11-26 With Oil and Gold Prices Depressed, Halliburton and Osisko Play Defense by Frank Holmes of U.S. Global Investors

Digestion of the acquired company often takes a while, during which time the buyer tends to experience a short-term slowdown. Its stock typically falls because, among other reasons, it must pay a premium for the acquisition.

2014-11-26 Global Economic Perspective: November by Christopher Molumphy, Michael Materasso, Roger Bayston, Michael Hasenstab & John Beck of Franklin Templeton Investments

Steady improvements in US employment and relatively good economic growth figures mean that debate over when the US Federal Reserve (Fed) will begin to tighten policy continues to be the order of the day. US job growth increased at a fairly brisk pace in October, and numbers for the previous two months (already good) were revised higher. Since the start of 2014, US employers have added more than 220,000 workers on average each month, which should be sufficient to sustain economic momentum after an initial reading showed annualized gross domestic product (GDP) growth of 3.5% in the third quarter

2014-11-26 2014 U.S. Midterms: A Win for Stocks? by Zachary Karabell of Envestnet

With the 2014 U.S. midterm elections behind us, investors wonder what the political gridlock will mean for the markets. If we consider historical trends and recent earnings, we could actually see a prolonged bull equity market.

2014-11-25 Gross versus Gundlach: Who Has More Skill? by Robert Huebscher (Article)

If rocket science has a counterpart in financial analysis, it is in the quantitative analytics from companies like Boston-based Northfield Information Services. Last week, I spoke with Dan di Bartolomeo, founder and CEO, to see if he could detect skill or luck among the two biggest fixed-income managers: Bill Gross, when he managed the PIMCO Total Return Fund (PTTRX), and Jeffrey Gundlach, manager of the DoubleLine Total Return Fund (DBLTX).

2014-11-25 The Dangers of Euphoria in Real Estate Investments by Keith Jurow (Article)

There is widespread consensus that the real estate crisis is over. Because of this complacency, wealth management firms and RIAs widely believe that you do not need to talk about risks at all.

2014-11-25 The Flaws in the Dollar Indices by Marianne Brunet (Article)

According to the most widely recognized data series, the value of the dollar has declined by approximately 20% over the last half century. Critics of federal policy claim this is proof of systematic "dollar debasement," engineered through quantitative easing and the Fed's mandate to maintain a baseline level of inflation. But that data series is incomplete, and once it is corrected, the 20% decline shrinks considerably.

2014-11-25 Five Steps to Networking Success by Dan Richards (Article)

Few things are more frustrating than when the time you spend networking with prospective clients produces no results. But I will share some good news: A few simple steps to rethink your expectations and change your approach will dramatically improve the outcome from networking activity.

2014-11-25 The Elusive Goal of Success by Daniel Solin (Article)

There's no shortage of information on the subject of success. The problem is defining what success means to you.

2014-11-25 How to Visually Illustrate the Fiduciary Obligation to Clients by Seaborn Hall (Article)

Industry and legal experts have described the fiduciary obligation as complex, simple, elusive, atomistic, and contradictory. It is like the parable of the six blind men describing the elephant: how you see it depends on your vantage point. Deriving a flexible, easily explained definition of the fiduciary obligation is a challenge.

2014-11-25 Aging Clients and Dementia by Beverly Flaxington (Article)

We are worried a client of ours might be in the early stages of dementia. How do we address this issue sensitively and most effectively?

2014-11-25 Fed "Mystified" Why Millennials Still Live at Home; My Answer May Surprise You by Mike "Mish" Shedlock of Sitka Pacific

A New York Fed research paper wonders Whats Keeping Millennials at Home? Is it Debt, Jobs, or Housing?

2014-11-25 Active Investing: Opportunity in Gold by Tim Gramatovich of AdvisorShares

As active managers, we embrace both a top down and bottom up investment philosophy as we look for opportunities for investment. One such potential opportunity we are seeing from more of a top down, thematic approach is in gold.

2014-11-25 Why Cant Investing Be as Simple as Going from Here to There? by Jerry Wagner of Flexible Plan Investments

After traveling more than 20,000 miles over the last month, my mind is overflowing with strong impressions gained from my travels. The richness of the culture, the beauty of the lands, and the friendliness of the people in Australia and New Zealand cannot be overstated. As Americans, we tend to think of ourselves as the youngest kid on the block with a freshness and youthfulness that puts Europes stodginess to shame. Yet down under there is a land as big as the USA with a history half as long and economies just in the earliest stages of expansion.

2014-11-25 Real Estate is Having a Moment by Christopher Gannatti of WisdomTree

Looking at equity market, one theme this year is that the U.S. has been outperforming global markets, both developed international and emerging markets. However, looking within the U.S., real estate has performed particularly well.

2014-11-25 Reflections on the 25th Anniversary of the Fall of the Berlin Wall: Part 2 by Bill O'Grady of Confluence Investment Management

Last week, we began our two-part series on the fall of the Berlin Wall with an examination of the end of Marxism. In this report, we will examine the rest of the important consequences from the fall of the Berlin Wall. These are: the Collapse of the U.S.S.R., the Onset of the U.S. Unipolar Moment, and the Impact of German Unification. We will conclude our comments with potential market ramifications.

2014-11-25 Middle East/Africa: Regional Economic Review - Q3 2014 by Team of Thomas White International

Despite continuing geopolitical tensions and subdued oil prices, the Middle East and Africa region had a largely positive third quarter. South Africa, the largest economy in this region, saw its labor problems diminish while Egypt reported a string of encouraging data, signaling that it is steadily recovering from a long phase of political and economic turbulence.

2014-11-25 Developed Europe: Regional Economic Review - Q3 2014 by Team of Thomas White International

Developed Europe remained bogged down by deflationary conditions all through the third quarter. Annual inflation in the regions 18-member single-currency bloc, the Euro-zone, slipped from 0.4 percent in July to 0.3 percent in September, its lowest level since October 2009.

2014-11-25 Where's Waldo Global Treasury Bond Style by Team of GaveKal Capital

In case some of our readers aren't familiar with the popular picture book/game series entitled Where's Waldo, here's a quick run down of how it works. Basically, the object is to find an inconspicuously dressed Waldo among a throng of people in endless settings ranging from a sports stadium to the Egyptian pyramids and everything in between. Finding Waldo isn't as easy as it sounds as he tends to blend in quite well with his surroundings.

2014-11-25 In Energy Revolution, Bond Investors Must Keep Their Heads by Ivan Rudolph-Shabinsky, Petter Stensland of AllianceBernstein

A surge in capital expenditures and leverage in the energy industry could end badly for some companies and their creditors. While select opportunities exist, we think bond investors should think carefully before they blindly bankroll todays North American energy revolution.

2014-11-25 Jeremy Siegel - Fair Value for the S&P 500 is 2,300 by Robert Huebscher (Article)

During the post-financial crisis period, no person has been more accurate at forecasting U.S. equity market returns than Jeremy Siegel, the Russell E. Palmer Professor of Finance at the Wharton School. In this year's interview, he explains why the fair value of the S&P 500 is 11% higher than its valuation today.

2014-11-25 What is Artificial Pricing? by Bob Andres of Andres Capital Management

After the sharp plunge in U.S. 10-year Treasury yields on the morning of October 15, 2015, Bob sent us a few articles which blamed the quick v-shaped price movement on the new breed of algorithmic traders often referred to as High-Frequency Traders (HFTs). The robots were at it again. They were scraping headlines; focused on speed and execution; artificially pricing the Treasury market. A herd mentality amongst the machines was blamed to which Geoff replied, Why doesnt someone write an algorithm to arbitrage algorithmic trading, and what do these people mean by artificial pricing

2014-11-25 3 Things to Think About, Including the Disconnect between Data And Surveys by Lance Roberts of Streettalk Live

Last Friday, I discussed the growing gap between economic reports particularly when they measure the same basic areas of the overall economy. For example, how can the Markit Manufacturing PMI Index be negative for three months while the ISM PMI has surged higher during the same period. Both cannot be right.

2014-11-25 Monetary Policy Outlook by Scott Brown of Raymond James

The minutes of the October 28-29 Federal Open Market Committee meeting suggested that there is still no consensus opinion among senior officials regarding when the Fed will begin raising short-term interest rates. There is strong agreement that monetary policy moves will be data-dependent.

2014-11-25 Thanksgiving Recipe by Jeffrey Saut of Raymond James

Begin with a turkey chilling in a sink for a few hours. Mix in the Bank of Japans shock and awe announcement of a week ago. Add the U.S. unemployment claims that are at a 14-year low and stir well, include housing prices that are better by +6%, fold in the Leading Economic Indicators advancing by 7%, the ECB announcement by Draghi about a bazooka of Quantitative Easing (QE), and the Thanksgiving dinner result . . . new highs for equity prices!

2014-11-24 Finding Small-Cap Opportunities in Technology and Energy by (Article)

Despite the recent correction for small-caps, we have been finding compelling opportunities in those areas of the market not always discussed in the headlines. Portfolio Manager Jim Stoeffel sits down with Co-Chief Investment Officer Francis Gannon to talk about investment ideas that play on current trends but may be particularly interesting to value-oriented investors.

2014-11-24 On the Verge of Chaos by John Mauldin of Mauldin Economics

In this weeks letter were going to explore some of the ramifications of the currency war that Japan is precipitating. It is more than just Germany, Korea, and China having issues and needing to contemplate their own competitive devaluations. If the yen goes too far too fast, there will be geopolitical repercussions far beyond the obvious first-order connections.

2014-11-24 A Most Important Distinction by John Hussman of Hussman Funds

Quantitative easing only works to the extent that default-free, low interest liquidity is viewed as an inferior holding. When investor psychology shifts toward increasing risk aversion which we can reasonably measure through the uniformity or dispersion of market internals, the variation of credit spreads between risky and safe debt, and investor sponsorship as reflected in price-volume behavior default-free, low interest liquidity is no longer considered inferior. Its actually desirable, so creating more of the stuff is not supportive to stock prices.

2014-11-24 Experts Weigh In On Solving Retirement by Roger Nusbaum of AdvisorShares

There were a couple of very interesting retirement articles posted last week that are worth pointing out. The first on was from the LA Times and focused on research and comments on the research from Alicia Munnell from the Boston College Center for Retirement Research which, cutting to the chase, concludes most people will not have the retirement they hope for in financial terms.

2014-11-24 Japan Dips into Recession as Japan, Inc. Profits Set New Highs by Jeremy Schwartz of WisdomTree

When investors buy Japanese equities, they dont really buy a slice of that economy; they buy shares in corporations that operate both in Japan and around the world. Japan, Inc. (i.e., Japanese corporations) is showing a profit picture that differs dramatically from the countrys economic growth rate.

2014-11-24 Supportive Outlook for Credit Conditions in Europe by John Pattullo (Article)

The market backdrop in Europe remains familiar; low economic growth, low inflation, relatively low defaults and volatility with the odd spike. This environment is attractive for corporate bond investing. Seasonals will soon start to kick in, helping credit markets to rally into Christmas and the early months of the new year. However, going forward bouts of volatility should be expected. This year alone there have been two volatility spikes; a 'valuation shakeout' in August and a 'position shakeout' in October. John Pattullo explains what lay behind each event.

2014-11-24 When 'Buy and Hold' Works, And When It Doesn't by Urban Carmel of The Fat Pitch

Imagine if you had invested in the S&P 500 in 1984 and held through the tech bubble and crash and then through the financial crisis and its recovery. How would you have done over those 30 years? As it turns out, very well. On a real basis (meaning, inflation-adjusted), your holdings would have appreciated by over 400%. A $100,000 investment in 1984 would now be worth more than $500,000.

2014-11-24 International Equity Commentary: October 2014 by Team of Thomas White International

International equity prices saw large price swings during the month of October as fears about slower global growth led to an appreciable decline during the first two weeks. Equity prices recovered subsequently as better than expected U.S. economic data helped allay global growth fears.

2014-11-24 Global Economic Overview: October 2014 by Team of Thomas White International

Regional growth trends diverged further during the month of October as data from the U.S. and China were positive, while activity in the Euro-zone remained subdued. The U.S. economy expanded faster than expected during the third quarter, helped by higher government spending.

2014-11-24 Emerging Markets Equity Commentary: October 2014 by Team of Thomas White International

Emerging market equity prices turned volatile during October as concerns about weak global growth and the impending close of bond purchases by the U.S. Federal Reserve unnerved investors. Still, some of the large emerging markets in Asia rebounded strongly during the second half of the month.

2014-11-24 Risk Parity: Comparing the Objections With Reality - Part 2 by Scott Wolle, Michael McHugh, David Gluch of Invesco Blog

As the use of risk parity has grown, so have criticisms against the approach. In this blog series, I look at objections Ive heard about risk parity, and explain why we believe they do not apply to our risk-parity approach - the Invesco Balanced-Risk Allocation strategy.

2014-11-24 Time to Look at Long Credit? by Mohit Mittal of PIMCO

?Tactical decisions regarding the scaling of an LDI allocation cannot be based solely on Treasury market dynamics. Given recent underperformance of long credit relative to intermediate credit, LDI investors should consider increasing long credit exposure. A structured approach that combines rigorous top-down macroeconomic-analysis to take views on duration and credit sectors with equally thorough bottom-up credit research to identify companies where fundamentals are improving may deliver alpha that can help clients reduce their funding mismatch over time.

2014-11-24 Equities Benefit as U.S. Growth Solidifies by Robert Doll of Nuveen Asset Management

The dominant news story last week was President Obamas announcement of new executive actions on immigration policy, but investors chose to look past any political risks and focused on the positives. Specifically, markets reacted well to signs that the European Central Bank would expand its monetary easing and to a surprise interest rate cut in China.

2014-11-24 You Thought QE Was Over? by Lance Roberts of Streettalk Live

A couple of weeks ago in the weekly newsletter I discussed the series of events behind the decline of the market in October and the subsequent surge.

2014-11-24 Let's Finally Fix The CBO by Brian Wesbury, Robert Stein of First Trust Advisors

If they came back today, the Founders of the United States wouldnt recognize the government they created 225 years ago. They put safeguards in place separation of powers, a bicameral legislature and reserved powers for the states to prevent it from growing so large.

2014-11-24 The Clock is Ticking in Switzerland by Peter Schiff of Euro Pacific Capital

For most of my career in international investing, I had always placed a great deal of faith in Switzerland's financial markets. In recent years, however, as the Swiss government has sought to hitch its wagon to the flailing euro currency and kowtow increasingly to U.S.-based financial requirements, this faith has been shaken.

2014-11-23 Chinas Monetary-Policy Surprise by Stephen Roach of Project Syndicate

In economic policy, as in most other areas, actions speak louder than words. By cutting its policy benchmark interest rates, the Peoples Bank of China has underscored the tactical focus of Chinese governments stabilization policy: it aims to set a floor of around 7% on GDP growth.

2014-11-23 Weighing the Week Ahead: Are Investors Too Complacent? by Jeff Miller of New Arc Investments

There is no investment edge from repeating what you read in the morning paper. Here was my list still worth watching: Geo-political that is not on the current radar a true black swan. An increase in the PCE index that was not accompanied by strong economic growth. Wage increases that were not accompanied by strong economic growth. Declining profit margins that were not accompanied by strong economic growth and increased revenues. An increase in the chances for a business cycle peak (the official definition of a recession). Remote at this point. An increase in financial stress t

2014-11-22 Solar Energy Powers Record Silver Demand by Frank Holmes of U.S. Global Investors

Silver demand in the fabrication of solar panels is set to outpace photography, if it hasn?t already done so.

2014-11-22 A Surprising Volatility Hedge by Heidi Richardson of BlackRock

Halloween has come and gone, but the bout of volatility in October is still haunting many investors.

2014-11-22 Rolling AlongFor Now by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

We remain optimistic that US stocks will likely continue to move higher, but warn against getting overly complacent as a pullback is always a possibility. The US economy is improving, the Fed is erring on the side of dovishness, and both corporate and consumer confidence are growing. The fall in oil should be a net positive for the US and global economy, and we are in a traditionally seasonally positive time of the year for equities. Global economies remain weak, but we are seeing a glimmer of hope from stepped up responses from foreign central banks.

2014-11-22 2015 Is Shaping Up to Be a "Turkey" of a Year for the U.S. Economy and Stock Market by Paul Kasriel of Econtrarian

As U.S. thin-air credit growth is on track to slow in 2015, thin-air credit growth in the eurozone and in Japan is likely to accelerate as the European Central Bank and the Bank of Japan step up their QE programs. These foreign QE programs could indirectly stimulate U.S. exports. But the dominant factor affecting the U.S. economy in 2015 will be below-normal growth in U.S. thin-air credit. So, as you gather your family around you on Thursday, November 27, to give thanks for our bountiful 2014 economic harvest, bear in mind that next years harvest is likely to be a turkey

2014-11-22 A Tale of Two Worlds by Doug MacKay and Bill Hoover of Broadleaf Partners

We are in a Tale of Two Worlds. One worlds success is highly dependent on the outlook for oil and other commodities, while the others is far less exposed and perhaps even a beneficiary of a more bearish climate. Commodity dependent countries like Russia, Saudi Arabia, China and Australia are hurt by falling oil prices, weak global demand and new sources of supply, while the United States, with a far larger consumer driven economy, experiences an overall net benefit, as perhaps seen in earnings from the likes of Wal-Mart, Best Buy, and Lowes in recent days.

2014-11-22 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Mixed fortunes drive the outlook for holiday spending; The Fed and Bank of England are working harder to achieve consensus; The dollar has a long way to strengthen before it impairs U.S. growth

2014-11-22 ECRI Recession Watch: Weekly Update by Doug Short of Doug Short

The Weekly Leading Index (WLI) of the Economic Cycle Research Institute (ECRI) is at 133.2, up from the previous week's 132.0. The WLI annualized growth indicator (WLIg) is at -2.4, down from -2.9 the previous week. ECRI's latest public statements have focused on Japan. The website now features a November 17th response to the announcement of Japan's Fourth Recession Since 2008.

2014-11-21 Emerging Markets Opportunity Still Emerging by Burt White of LPL Financial

We believe emerging markets (EM) fundamental conditions are set for improvement in 2015, based on our outlooks for economic growth, earnings, and policy. Valuations are compelling and EM may be situated to recapture some of their relative losses from a technical perspective, particularly in Asian markets. However, somewhat mixed fundamental and technical pictures suggest a better opportunity may be forthcoming

2014-11-21 3 Things Worth Thinking About, Including the Message from Commodities by Lance Roberts of Streettalk Live

Following the October swoon, stocks have vaulted to all-time highs. As I discussed previously in "Sentiment Is Off The Charts Bullish," there have only been few occasions where investors have felt so "giddy" about the financial markets. Such periods of exuberance have never ended well for investors as they were deluded by near-term "greed" which blinded them to the building risks.

2014-11-21 Gold Gets Physical by Ade Odunsi of AdvisorShares

Its happening again the gold cost of carry as defined by the one month gold forward rate has swung sharply into negative territory. This means that an investor is able to earn a positive carry from owning gold. This is unusual for gold markets and a relatively rare occurrence the more common scenario is that because of the storage costs associated with gold, an investor would expect to have to pay a cost of carry to hold gold. Prior to the instance in July 2013, the last time that gold forward rates went negative was in November of 2008.

2014-11-21 If German Yields Break To New Lows, European Cyclicals Will Likely Follow by Team of GaveKal Capital

European cyclicals continue to be the weakest segment of developed global equity markets, and there doesn't appear to be much sign of that changing. We refer to the extremely strong relationship between German 10 year bond yields and the relative performance of European cyclical sectors.

2014-11-21 The Right Fit: Global Bonds and DC Plans by Alison Martier of AllianceBernstein

At a time when US defined contribution plans are seeking to control risk and enhance returns, hedged global bonds can improve outcomes for participants and sponsors. But how do plans incorporate global bonds in core menus and target-date funds?

2014-11-21 The Implications of Easing by Mark Mobius, Michael Hasenstab of Franklin Templeton Investments

Just as the US Federal Reserve (Fed) announced the conclusion of its long-running quantitative easing (QE) program, the Bank of Japan surprised markets by announcing the expansion of its own easing regime. Mark Mobius, Executive Chairman, Templeton Emerging Markets Group, and Michael Hasenstab, Chief Investment Officer, Global Bonds, Franklin Templeton Fixed Income Group, weigh in on the implications of these central bank actions, as well as current European Central Bank (ECB) policy, and what they could mean for investors on both the equity and fixed income side.

2014-11-21 Is Your Portfolio Truly Diversified? by Eric Stein of Eaton Vance

In this Insight, Eric Stein, co-director of Eaton Vance Global Income Group, discusses the potential benefits of absolute return strategies, what they invest in and the role they can play in investor portfolios.

2014-11-21 Asia's Deepening Capital Markets by Robert Horrocks of Matthews Asia

The drivers of economic growth, the region's small- and medium-sized enterprises, are finally gaining access to capital through alternative funding sources outside of just banks. Retail investors are accessing increasingly diverse products in which to store their savings and build wealth. Institutions are demanding long-dated assets to match their liabilities? Are we finally seeing more stable local demand in Asia's local capital markets?

2014-11-21 Still A Winning Hand by Scott Mather, Mark Kiesel, Mihir Worah of PIMCO

The U.S. is finally enjoying a self-sustaining economic recovery, but slow global growth remains a concern and financial markets are bouncing up and down by the day. So what exactly does this U.S. recovery mean for investors?

2014-11-21 Falling Gas Prices Fuel Holiday Cheer by Scott Minerd of Guggenheim Partners

Rising equities and falling prices at the pump will bring holiday cheer, but be aware of potential headwinds as we head into 2015.

2014-11-20 Buyer Beware: Nowhere To Hide by John Del Vecchio of AdvisorShares

The price/sales ratio is often used as a valuation metric in the place of earnings because of the common belief that revenues are harder to manipulate than earnings. In my book, Whats Behind the Numbers? (McGraw-Hill, 2012), I debunk that theory and outline many ways that management teams can aggressively manage the top-line. Nevertheless, the price/sales ratio is useful because there are fewer inputs, such as reserves, tax issues, share buybacks, and recurring charges, than earnings that can be used to manage the reported results.

2014-11-20 Outlook 2015: European Equities by Rory Bateman of Schroders Investment Management

Monetary policy remains loose in Europe but governments could do more to boost demand. Meanwhile, the weaker euro and stronger banking sector should help support European equities in the coming year.

2014-11-20 The Abenomics Death Spiral by Peter Schiff of Euro Pacific Capital

As Japanese Prime Minster Shinzo Abe has turned his country into a petri dish of Keynesian ideas, the trajectory of Japans economy has much to teach us about the wisdom of those policies. And although the warning sirens are blasting at the highest volumes imaginable, few economists can hear the alarm.

2014-11-20 Will $2.50 Gasoline Catalyze U.S. Consumer Stocks? by William Smead of Smead Capital Management

A great deal has been written about how lower gasoline prices could stimulate discretionary purchases in the United States. RBOB gasoline futures peaked on June 20, 2014 at $3.12 per gallon and closed on November the 14th at $2.04. Those in the bearish camp like Randall Forsyth at Barrons argue that lower oil and gas prices will negate and ruin the economic benefit of the oil boom.

2014-11-20 Hiring Good Managers Is Hard? Ha! Try Keeping Them by John West, Amie Ko of Research Affiliates

Because the likelihood of hiring equity managers who will outperform the market is remote, it is sensible for investors to monitor their actively managed funds. But placing underperforming managers "on watch" might not be the best policy.

2014-11-20 Japanese Recession and the Referendum on Abenomics by Team of Northern Trust

Early this week, Japanese Prime Minister Shinzo Abe announced that he will delay to April 2017 from October 2015 the next phase of his countrys consumption tax hike. In addition, he dissolved the lower house of Parliament and announced that elections will be held on December 14.

2014-11-20 Flows Potential: Fund Managers Remain Under-Weight Japan by Jeremy Schwartz of WisdomTree

The recent bout of aggressive monetary policy easing by the Bank of Japan (BOJ), combined with the direct purchases of equities by the Japanese Government Pension Investment Fund (GPIF), has brought on a new period of positive sentiment toward Japanese equities.

2014-11-20 The "Other" Problem for Bond Investors by Robert Isbitts of Sungarden Investment Research

For a while now, my firm and I have been devout in alerting our clients and blog subscribers to the issues that will confront them as investors if/when the more than three decades of generally falling U.S. interest rates reverses itself. But what if they dont rise much for a while, and instead stay around where they are?

2014-11-20 The U.S. Labor Market - Show Me the Money by Marie Schofield of Columbia Management

The U.S. labor market data has improved in the last six months now that many measures have reached cyclical highs. For the Federal Reserve though, this is not enough. They want to see this data feed through to a broader rise in incomes and wages, and ultimately spending. This will be necessary to bend the economic trajectory toward sustainably higher growth.

2014-11-20 Muni CEFs Featuring John Cole Scott by (Article)

After last year’s difficulties, closed-end funds with municipal bonds now appear relatively attractive for discount-seeking investors, says John Cole Scott of CEF Advisors.

2014-11-19 U.S. Congress: 10 Post-Election Moves to Watch by Milton Ezrati of Lord Abbett

Amid the big changes in the U.S. capital, here are the potential legislative actions that could influence financial markets.

2014-11-19 A Yield Play Without Any Yield? by Roger Nusbaum of AdvisorShares

On Friday a recently launched IPO fell about 15% on an earnings report that was poorly received by markets leaving the stock down 39% since its first day of trading in June. Naming names becomes difficult for compliance reasons but as a hint it is an infrastructure name and you would probably need to read the name two or three times to figure out the word.

2014-11-19 Global Economy Worsening, But America is on Top by Gary Halbert of Halbert Wealth Management

With President Obama making controversial moves on several fronts this month, it is tempting to go all politics this week. The president is threatening to grant defacto amnesty to five or six million illegal aliens, via Executive Order, even though he knows this is unpopular among the American people. Its as if hes in full denial regarding the landslide midterm election results.

2014-11-19 Next 12 Month Sales Estimates For MSCI North America Lowest Since 2009 by Team of GaveKal Capital

Last week we looked at how sales growth estimates for the next fiscal year are now negative for five of the 10 MSCI World Index sectors. Today, we are again looking at estimates but this time from a forward 12-month perspective. Sales for the MSCI World Index are only expected to grow by 3% over the next 12 months according to estimates (blue line below). This is about 2% lower than expected in July. EPS for the MSCI World Index are expected to grow by 9% over the next 12 months which is about 1.5% lower than expected in July.

2014-11-19 Indonesian Optimism by Tek Khoan Ong of Franklin Templeton Investments

Southeast Asia represents one of the fastest-growing regions in the world today, and is one that we are excited about as investors. The Templeton Emerging Markets Group held our semiannual analyst conference in Jakarta in September, and one of the key reasons for choosing that location was to observe and discuss the changes and challenges on the ground with the new regime of President Joko Widodo. Ive invited my colleague Tek Khoan Ong to pen some thoughts on the outlook and investment opportunities in Indonesia today.

2014-11-19 Ben Bernanke: Too Big to Fail by Liz Ann Sonders of Charles Schwab

I shared the stage at Schwabs IMPACT conference recently with former Fed Chair Ben Bernanke (a goose-bumpy experience). He was remarkably funny; but also firm in his views about the merits of the Feds extraordinary efforts to stem the tide of the financial crisis. Notably, he strongly pushed back on the notion that QE is an inflation accident waiting to happen.

2014-11-19 Credit Markets Signaling Near-Term Caution by Chris Puplava of PFS Group

Since the S&P 500 bottomed at 1820 on October 15th, it is up roughly 12.5% and has seen only 6 down days in the last month. According to trading desks, steady growth in the U.S. and China, better-than-feared European economic data, and accommodative global central banks are the main causes for driving the market higher. Other bullish supports are an increase in foreign buying of U.S. equities and corporate buybacks.

2014-11-19 Examining the Divergence between Equities and Credit by Bradley Krom of WisdomTree

Over the last year, U.S. equities rallied, and credit spread generally tightened. However, in recent months, this winning formula has started to diverge. Concerns about global growth, potential changes in monetary policy and uncertainty from geopolitical risk weighed on investor sentiment.

2014-11-19 A Mixed Bag, But Optimistic on the Consumer by Scott Brown of Raymond James

Inflation-adjusted consumer spending growth, 70% of Gross Domestic Product, rose at a lackluster 1.8% annual rate in the advance estimate for 3Q14. That figure is likely to be revised higher, but the pace is expected to remain disappointing relative to job growth (this year, we are on track to post the largest increase in jobs since 2005). The main restraint on spending appears to be the weak trend in average wages. Until the job market tightens a lot more, were unlikely to see a significant pickup in wage growth.

2014-11-19 Crude Oil? by Jeffrey Saut of Raymond James

Integrity, Websters dictionary defines it as, The quality of being honest and having strong moral principles. Recently the voters of America sent the D.C. crowd a message that they want integrity back in government. Consequently, I viewed the midterm election as a turning point. And, a turning point approaches on December 21st of this year. Thats when the Winter Solstice arrives.

2014-11-19 Investment Implications for UK DC Schemes in Light of Tax and Regulatory Changes by William Allport of PIMCO

With greater flexibility and choices available to DC savers in the latter stages of their career, we believe DC schemes need to reconsider their traditional pre-retirement approach to providing low-risk, income-orientated and pre-retirement investment portfolios. The primary immediate challenge for UK DC schemes is navigating the need for capital stability versus a portfolio that can generate a sustainable income stream for DC savers in retirement.

2014-11-19 Understanding Investor Anxiety: A Perspective on Diversification by Doug Short (Article)

Diversification is a cornerstone of Modern Portfolio Theory and risk management. We spread our investments across a range of asset classes, rebalancing periodically, to ensure participation in the upside and reduce exposure to the downside. This is a time-honored strategy that works ... most of the time. But during the epic market downturn of the Financial Crisis, equity asset classes essentially marched in step to the same dismal drumbeat.

2014-11-18 Why the Way You Work Destroys Productivity by Dan Richards (Article)

Research from brain science has highlighted four ways that our work routines sabotage productivity and identified four ways to increase our efficiency and effectiveness.

2014-11-18 A Touching Way to Increase AUM by Daniel Solin (Article)

Nonverbal signals play a bigger role than you think in increasing your AUM. What you wear, your body language and "touching" have a meaningful impact on how prospects perceive you - within seconds of initial contact.

2014-11-18 A Process to Get Things Done! by Beverly Flaxington (Article)

Our firm has many new projects underway. Our owner expects us to finish everything quickly while still managing client accounts. How do we communicate that we are working hard and take these projects seriously but that we can't do everything at once?

2014-11-18 Deflation Fears Are A Distraction by Brian Wesbury, Robert Stein of First Trust Advisors

No matter what happens these days, deep fears, driven by breathless newscasters, take things to the extreme. As a result, slight gains in inflation create forecasts of hyper-inflation, while slowing or low inflation leads to fears of deflation.

2014-11-18 Creativity, Corporatism, and Crowds by Robert Shiller of Project Syndicate

Ultimately, economic progress depends not on saving and the accumulation of capital, but on creativity. That is why fear of secular stagnation in todays advanced economies has many wondering how creativity can be spurred.

2014-11-18 Has Europes Recovery Story Turned Back a Page? by Heather Arnold of Franklin Templeton Investments

The European economy at large had been moving forward in the wake of the 20072009 global financial crisis and subsequent sovereign debt crisis, spurred by European Central Bank (ECB) President Mario Draghis pledge to do whatever it takes to save the euro in 2012 and the implementation of austerity measures in the eurozone periphery. In recent months, the recovery seemed to have stalled, with some countries, including the eurozones engine of growth- Germany - flirting with recession.

2014-11-18 Tinkering with the Core Bond Recipe by Alison Martier of AllianceBernstein

This is the time of year when, in almost every American household, the tinkerer in the family eyes the recipe box. Certain venerable traditions will make it to the Thanksgiving table intact. A cousin or an in-law is sure to bring an entirely new dish. And some traditional plates could use some freshening up. Thats the case with core fixed income.

2014-11-18 Is This Purgatory, Or Is It Hell? by Ben Inker of GMO

GMO is often accused of being a glass half empty investor, and I admit that in a year that has seen the S&P 500 rise 8.3%, MSCI All-Country World rise 3.7%, and the Barclays U.S. Aggregate rise 4.1% through the third quarter, the words Purgatory and Hell are unlikely to come to mind to most investors when opening their brokerage statements. It has been a dull year, perhaps, but certainly not a hellish one. So what is bringing Danteesque visions of damnation into our slightly warped minds?

2014-11-18 Bubble Watch Update by Jeremy Grantham of GMO

As you may remember, the January Rule serves as a kind of barometer for the behavior of the market in the coming year. Historically, when January was down, the rest of the year had over twice the declines than one would expect randomly, far more mediocre months, and a very sub average return. But it is far from perfect and it had the unusual problem this year of bumping into the positive signal from the Presidential third year, which started for us on October 1.

2014-11-18 The Beginning of the End of the Fossil Fuel Revolution (From Golden Goose to Cooked Goose) by Jeremy Grantham of GMO

The quality of modern life owes almost everything to the existence of fossil fuels, a massive store of dense energy that for 200 years had become steadily cheaper as a fraction of income. Under that stimulus, the global economy grew ever larger, more complex, more inter-related and, I believe, more fragile. Then around the year 2000 the costs of finding oil start to rise at over 10% a year, and with the global economy growing at only 4% oil starts to fall behind in affordability.

2014-11-18 Putins World: Why Russias Showdown with the West Will Worsen by Vitaliy Katsenelson of Investment Management Associates

I grew up hating America. I lived in the Soviet Union and was a child of the cold war. That hate went away in 1989, though, when the Berlin Wall fell and the cold war ended. By the time I left Russia in 1991, the year the Soviet Union collapsed, America was a country that Russians looked up to and wanted to emulate. Twenty-three years later, a new version of cold war is back, though we Americans haven't realized it yet

2014-11-18 How AQR's New Fund Adds Value - An Alternative Approach to Alternatives: Investing with Style by Larry Swedroe (Article)

The conventional justification for alternative investments has been their ability to effectively diversify against core equity and fixed-income allocations. But, in many cases, the empirical data doesn't support that view. A new fund provides a different way to obtain returns from sources that have low to negative correlation to stocks and bonds, as well as each other - an alternative to alternative investment vehicles.

2014-11-18 Why the Risk-Reduction Benefits of Bond Ladders Have Been Overstated by Joe Tomlinson (Article)

Proponents of bond ladders argue that they will significantly improve the security of financial plans. Others contend that the risk reduction benefits are merely a mirage. I side with the latter view and will explain why.

2014-11-17 The Hypocritical Assertions of CFP Lobbyists CFP Lobbying Organization Calls Out RIAs by John H. Robinson (Article)

Recently released research from the Financial Planning Coalition is likely generating the desired attention its media-savvy crafters intended, but an informed reading of the materials reveals a campaign that is at odds with the ethical preaching of its three member organizations.

2014-11-17 Capital Allocation and Risk Management by (Article)

Companies with little or no debt on their balance sheets can focus on capital allocation decisions that help the business to grow and/or return free cash back to shareholders. Especially during uncertain periods, a low-debt balance sheet also helps us to assess risk, which is crucial in the small-cap universe, where companies are often fragile.

2014-11-17 Navigating the Credit Markets by Bob Andres of Andres Capital Management

Both the corporate and municipal bond markets continue to be shrouded in decades old business practices, provincial in nature and unfamiliar to many independent advisors and retail investors.

2014-11-17 Tracking the Market with Social Media by Blair Jensen of Trade Followers

The Trade Followers Twitter Momentum indicator for the S&P 500 Index (SPX) continued to drift this week as the market posted a small gain. It is attempting to turn down, but lack of confidence from the bears on Twitter is holding 7 day momentum up. The StockTwits indicator moved up into what is normally an overbought condition that has caused the market to pause in the past. Both streams are indicating that we should see some consolidation or sideways movement over the next week.

2014-11-17 When Will Value Come Back Into Favor? by Will Nasgovitz, Ted Baszler, Dave Fondrie of Heartland Advisors

An investment style may be inherently biased toward one part of a market cycle. Understanding that fact can help investors stay the course when faced with superficially inferior results during an unfavorable portion of the cycle.

2014-11-17 These Go to Eleven by John Hussman of Hussman Funds

We have entered an environment in which extraordinarily thin risk premiums have been joined in recent weeks by a subtle shift toward increasing risk aversion. Present conditions couple every essential component of historically extreme and vulnerable market environments. The market has been dodging boomerangs, not bullets, and they are likely to come back harder for it.

2014-11-17 On My Radar: Stocks Remain Richly Valued by Steve Blumenthal of CMG Capital Management Group

Shortly after each month end (after the most recent reported earnings numbers are posted), I like to run through a few of my favorite valuation charts to gauge level, asses risk and to get a sense for what the probable forward return may be. Fortunately, there is a great deal of historical data that can help us.

2014-11-17 Risk Parity: Comparing the Objections With Reality Part 1 by Scott Wolle, Michael McHugh, David Gluch of Invesco Blog

Over the last several years, risk parity has gained prominence as a general asset allocation approach as well as a specific strategy. Rising adoption rates of the approach have invited scrutiny from both practitioners and academics. We agree with some of the challenges identified by critics and have addressed them over time through our research agenda. Others, however, either do not apply to our version of risk parity or, at least to our knowledge, the approach in general.

2014-11-17 U.S. Economy: The Disconnect between Reality and Perception by Russ Koesterich of BlackRock

American sentiment remains weak despite encouraging improvement in economic fundamentals. We think sluggish growth in wages plays a major part in keeping optimism at bay.

2014-11-17 Economic Data Continues to Impress, Driving Equities Higher by Robert Doll of Nuveen Asset Management

Once again, a combination of solid economic data, decent earnings results and receding fears of global deflation pushed stock prices higher. The S&P 500 Index rose for a fourth consecutive week, gaining 0.4%. The telecommunications and technology sectors showed particular strength while utilities and energy lagged.

2014-11-17 Morningstar Responds to Our Analysis of its Ratings by Jon Hale (Article)

Morningstar's director of manager research responds to Robert Huebscher's article, A First Look at Morningstar's Analyst Ratings, which appeared last week.

2014-11-16 Weekly Market Summary by Urban Carmel of The Fat Pitch

SPX, DJIA and RUT ended the week nearly unchanged from last week. NDX, which was unchanged last week, gained 1.5%. It's hard to say trend is not bullish: SPX, DJIA and NDX all made new highs intra-week; RUT briefly traded above its early September high before closing lower.

2014-11-16 Weighing the Week Ahead: Time to Buy Commodities? by Jeff Miller of New Arc Investments

It may not be the exact bottom for energy stocks, but they are among the cheapest on a P/E basis. There is a lot of bad future news in current commodity prices, so the risk/reward balance has shifted. Many seem to start with the commodity prices and infer future economic weakness. This method is unreliable with a lot of false signals. I prefer to begin with economic data and then find the most attractive stocks. I provide more detail in Circular Reasoning about Commodities, including why I favor ESV and FCX.

2014-11-15 Reality Check by Bob Rodriquez of FPA Funds

As many of you know, and for those of you who dont, Ive been a harsh critic of the fiscal and monetary policies that have been deployed these past several years. Since returning from my 2010 sabbatical in 2011, Ive been very cautious about capital deployment, as many of my successors will confirm. In light of the stock markets astounding rise since 2009 and five years of near zero short-term rates, Ive reassessed and challenged my basic fundamental understanding of how the financial markets operate.

2014-11-15 U.S. Economy: The Disconnect between Reality and Perception by Russ Koesterich of BlackRock

American sentiment remains weak despite encouraging improvement in economic fundamentals. We think sluggish growth in wages plays a major part in keeping optimism at bay.

2014-11-15 Explore and Discover the Winners When Gas Prices Fall by Frank Holmes of U.S. Global Investors

West Texas Intermediate (WTI) oil for December delivery is currently priced at $75 per barrel, Brent for January delivery at $78 per barrel. Many investors, publications and news sources focus only on the drawbacks to falling oil and gas prices-don't get me wrong, there are many-but today we're going to give the spotlight to the biggest winners and beneficiaries.

2014-11-15 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Falling oil prices produce gain... and pain; Brazil's post-election challenges; The Fed may seek to overshoot its inflation target

2014-11-15 Volatility and Risk by Heather Rupp of AdvisorShares

Volatility has seemed to be the trend in markets over the past couple months. It was just a few weeks ago that we saw equity markets getting crushed, only to roar back and actually finish up for the month of October and back near all-time highs. It makes no sense to us that investors have no problem dealing with volatility in stocks, investing for the long run, as the stock market has historically gone up, but with the high yield asset class, we often see the risk on or risk off mentality, meaning investors think they should either be fully invested

2014-11-15 Where You Finish Could Depend on Where You Start by Robert Isbitts of Sungarden Investment Research

It helps to be aware of the many possible outcomes and adjust your strategy to sync with the current record price highs in this popular market benchmark. Doing so can help you be more successful, regardless of what the next five years may bring. In this sense, it is not where you finish, its where you start.

2014-11-15 Hard to Hit Two Targets at Once: The ECB ABS Asset Purchase Programme by Felix Blomenkamp of PIMCO

We believe that reviving the asset-backed securities (ABS) market is a better near-term goal, and the primary target of the European Central Banks (ECB) buying programme should be the new issuance market. Sizeable purchases by the ECB in the European ABS market carry the possible risks of crowding out established investors and suppressing interest in this asset class. By not crowding out existing investors while making the asset class more attractive to issuers and investors alike, the ECB has an opportunity to reach its ultimate goal to spur lending.

2014-11-14 High-Yield Bonds & Oil Prices by Team of LPL Financial

The decline in oil prices and its impact on the high-yield market has been cited as a concern for investors. This week we stay on the topic of high-yield bonds and take a closer look at the potential impact of oil prices on the high-yield bond market and whether recent concerns are justified.

2014-11-14 Investment Update October 2014 by James Klein of Meritage Portfolio Management

Coming off a strong second quarter, stocks turned in a mixed performance for the three months ending September 30. The fundamental backdrop for stocks remained relatively stable, with interest rates drifting slightly lower and generally supportive news flow around corporate earnings, economic growth, inflation and Fed policy. While this familiar combination of factors has been hospitable for stocks, this past quarter reflected a growing unease about the prospects of further upside.

2014-11-14 Contemplating Stocks without QE by Peter Schiff of Euro Pacific Capital

Some influences on the stock market are casual, subtle or open to interpretation, but the catalyst behind the current stock market rally really shouldn't be controversial. As far as stocks go, we have lived by QE. The only question now is, whether we will die without it.

2014-11-14 Global Investing: Are Foreign Stocks Attractive? by Mark Ungewitter of Charter Trust Company

One of todays most glaring inter-market divergences is the relative performance of US versus non-US equities. For dollar-based investors, non-US stocks have underperformed US stocks by a whopping 40% over the past five years. But are foreign stocks attractive at current prices? And if so, how much of my portfolio should I allocate abroad?

2014-11-14 Mean-Reverting Profits and Other Things Worth Thinking About by Lance Roberts of Streettalk Live

Earlier this week I discussed the growing detachment between the stock market and the "real" underlying economy. One of the areas I touched on was corporate earnings that have been elevated by an immense amount of accounting gimmackry, cost cutting, and productivity increases. The problem, as I stated, is that historically earnings have grown 6% peak-to-peak before a reversion. Notice, I said peak-to-peak. The issue is that the majority of analysts now estimate that earnings will rise unabated for the next five years.

2014-11-14 How the Long Bond Stole the Trophy by Gibson Smith of Janus Capital Group

The aggressive bet many investors made on long-end rates in 2014 was the equivalent of betting on a Hail Mary pass to win the game. It has been rewarding, but is it repeatable? Probably not. Janus Fixed Income CIO Gibson Smith reflects on why he believes consistency beats the long shot, in sports and in investing.

2014-11-14 Tired of Being Scared Yet? by Richard Bernstein of Richard Bernstein Advisors

Bull markets are based on climbing the proverbial wall of worry, and this cycle has been no different. We have consistently argued over the past five years that the current bull market could be one of the biggest of our careers. Both investors and corporations continue to act conservatively because of the uncertainty caused by a litany of issues. Uncertainty is typically the engine of bull markets.

2014-11-14 Bad #Deflation by Keith McCullough of Hedgeye Risk Management

Obviously times, technologies, and mostly everything other than the Old Wall have changed. But the very basic difference between what Ill call good vs. bad #deflation has not.

2014-11-13 The October Employment Report by Scott Brown of Raymond James

The headline figures from the September jobs report were better than expected. However, the details were more consistent with moderate growth and a continued high degree of slack. Fed officials arent going to jump to any conclusions.

2014-11-13 Dash Dash...Dot Dot by Jeffrey Saut of Raymond James

Dash, Dash ... Dot, Dot is all about Morse Code where the dash is three times the duration of the dot. According to Wikipedia, Each character (letter or numeral) is represented by a unique sequence of dots and dashes. Each dot or dash is followed by a short silence, equal to the dot duration.

2014-11-13 Municipal Market Perspectives by Team of SMC Fixed Income Management

The most surprising and impressive asset class performance has been generated by long-term municipal bonds. Most pundits were calling for negative market performance again this year following the sharp 2013 sell-off; no one we know of (ourselves included) foresaw the stellar returns achieved through the years first ten months.

2014-11-13 "Late Cycle" Markets by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

Late in the summer we sold several fully valued stock positions and kept the proceeds in cash. We had trouble finding attractively valued alternatives, were alarmed about the falling prices in everything except large capitalization US stocks, and worried about the high degree of optimism in the stock market.

2014-11-13 Portfolio Effects of Holding Gold in Yen Terms by Ade Odunsi of AdvisorShares

Last week in Gold in Yen Calm in the Eye if the Storm we focused on the factors behind the significant outperformance of gold priced in yen versus gold priced in dollars, identifying the strength of the dollar as the primary factor pushing down the price of gold in dollars. While on the currency side, the strength of dollar resulted in significant weakness in the YEN/USD FX rate.

2014-11-13 The ETF Trader Interview Series: Ken Dolan, Jefferies & Company by David Abner of WisdomTree

In this edition, Dave Abner, Head of Capital Markets at WisdomTree, speaks with Ken Dolan, Senior Vice President on the ETF trading desk at Jefferies & Company, Inc. Ken joined the desk in 2011 after spending nine years at LaBranche & Co. as a Managing Director and Head of ETF Trading. In addition to his ETF trading experience, Ken has nine years of trading experience across equities, fixed income and emerging markets at Deutsche Bank, Credit Suisse and Lehman Brothers. He received a BS from Providence College and is a Chartered Financial Analyst.

2014-11-12 Corporate Profit Margins versus Employee Compensation: A Rather Disturbing Comparison by Doug Short (Article)

Yesterday's collection of Advisor Perspectives articles particularly caught my attention: "Why Jeremy Grantham is Right about Corporate Profit Margins." The article includes a number of fascinating graphs, the first of which is a snapshot of US Corporate Margins since 1947 calculated by dividing Corporate Profits after Tax by Gross National Product.

The article inspired me to produce a chart of the Profit-to-GNP ratio, but with an added and rather sobering overlay: Employee Compensation (wages and salaries), which I've likewise divided by GNP.

2014-11-12 Oil Prices: Good News by the Barrel by Milton Ezrati of Lord Abbett

Ignore the pessimists. Declining petroleum prices likely will give an overall boost to the U.S. economy.

2014-11-12 Our Investment Beliefs by Chris Brightman, Jonathan Treussard, Jim Masturzo of Research Affiliates

The public launch of Research Affiliates interactive Asset Allocation website this month gives us an opportunity to describe the investment beliefs underlying our models, expected returns, and investment strategies. To be clear, our beliefs are constructs that help us make sense of the capital markets.

2014-11-12 Ramifications of Republican Romp by Robert McConnaughey of Columbia Management

In our recent midterm election preview, we said that Republicans were likely to gain control of the Senate in a close contest; we also laid out some possible implications of such a win. As it turns out, we did not give the Republican momentum enough credit, as election night turned out to be a clear victory for the GOP across the board.

2014-11-12 Four Questions on Investors Minds Today by Chris Engelman of Cedar Hill Associates

From the strengthening U.S. dollar to Bill Gross departure from Pimco, a few common questions have been coming up in Cedar Hills meetings with clients during the past few months. In this article, Managing Director Chris Engelman shares the firms thoughts on these timely issues.

2014-11-12 Retirement Saving Crisis is Worse Than We Thought by Gary Halbert of Halbert Wealth Management

Each year Wells Fargo & Company conducts a survey of middle-class Americans of various ages to see how they are faring with saving for retirement. The results of the 2014 survey were just made public late last month. I will summarize them for you below. Let me warn you in advance they are not pretty!

2014-11-12 When Oil Prices Dip, Unexpected Winners Emerge by Russ Koesterich of BlackRock

A stronger dollar is one of the reasons that oil prices are low, which serves many energy-importing economies in Asia while weighing on large oil-producing nations.

2014-11-12 Is Levering Bonds a Losers Game Today? by Michael DePalma, Arnab Nilim of AllianceBernstein

Multi-asset strategies like risk parity owe much of their popularity to their ability to navigate the global financial crisis. Lately, critics have cited levered bond returns as the driverand as a looming headwind. We think theyre missing a key point.

2014-11-12 Octobers Market Ups and Downs Put Into Perspective by Ed Perks, Don Taylor, Peter Langerman of Franklin Templeton Investments

Global equity markets went on a rollercoaster ride in October, although given the cauldron of global issues that were brewing for some time and the months history of big moves, it shouldnt be all that shocking many investors got spooked. While much of the media focused on the short-term panic, long-term investors used such pullbacks to search for bargains.

2014-11-12 4Q Tax Selling Featuring Ken Fincher by (Article)

Seasonal “tax selling” may present opportunity to closed-end fund investors looking for potential bargains, says Ken Fincher of First Trust Advisors.

2014-11-11 A First Look at Morningstar's Analyst Ratings by Robert Huebscher (Article)

Overwhelming academic evidence documents the difficulty in distinguishing skill from luck among actively managed mutual funds. Despite this fact, many vendors have attempted to identify those that will beat their benchmarks and deliver excess risk-adjusted returns. Noteworthy among those vendors is Morningstar, which offers forward-looking "analyst ratings." We've evaluated the predictive ability of the first vintage of those ratings, which were published three years ago.

2014-11-11 Why Jeremy Grantham is Right about Corporate Profit Margins by Baijnath Ramraika, CFA® and Prashant Trivedi, CFA® (Article)

As U.S. corporate profit margins have made it to record highs, a debate has raged between those who place their hopes on a new paradigm of sustained high profits and those who believe in capitalism's efficiency and the tendency of margins to revert to the mean. We show that an often-cited explanation for the new paradigm - that the U.S. economy is more service-focused - lacks empirical support.

2014-11-11 How to Get Clients to Open Your Emails by Dan Richards (Article)

It's imperative that your clients and prospects open and read your e-mails. But with escalating volumes, people are drowning in email, leading to steep declines in open rates and readerships. Here's the latest research on how to get your email read.

2014-11-11 Use Oxytocin to Gather More AUM by Daniel Solin (Article)

While competency is critical to your success, understanding how prospects make decisions is more important. Understanding the role of a chemical compound produced by your brain - oxytocin - will give you a tool to emotionally connect with prospects.

2014-11-11 Nine Tips for Great Performance Reviews by Andrea Schlapia (Article)

Here are nine actions managers can take to encourage and motivate employees during performance reviews.

2014-11-11 Qualifying Made Easier by Beverly Flaxington (Article)

I have so many leads that sometimes I can't manage them all in one day. My biggest problem is that when I do follow up and generate interest, only a small portion open an account. Where am I making a mistake?

2014-11-11 The Last Argument of Central Banks by John Mauldin of Mauldin Economics

In this weeks letter I have for you a brief essay on the topic of deflation. Depending on your view, you might find some of my thoughts controversial, but I will try to make my case clear, at least. Please note this is the 30,000-foot view and is nowhere close to definitive.

2014-11-11 Early Freeze Could Derail Economic Growth Forecasts by Lance Roberts of Streettalk Live

This past August I discussed the potential for the market to rise to 2100 along with "5-risks" to that forecast. One of those risks related to the "Polar Vortex" that shut down economic activity across much of the northern part of the economy.

2014-11-11 One year in: Im doubling down on investment discipline by Jeff Hussey of Russell Investments

Since assuming the role of Global CIO here at Russell Investments one year ago, I have been met by one inescapable truth again and again: Discipline matters!

2014-11-11 Capital Raising in the MLP Sector Remains Active by David Chiaro of Eagle Global Advisors

We continue to see evidence that underpins our long term positive outlook on MLPs and midstream energy infrastructure companies. The need for new midstream infrastructure remains significant and announcements of large projects continue to be made. New export markets for U.S. hydrocarbons continue to develop and offer new profit opportunities for MLPs.

2014-11-11 The Continuation of QE by Bob Andres of Andres Capital Management

October 30, 2014 ended the third and final round of Quantitative Easing. Right? The announcement was couched in a hyperlinked document at the end of the FOMC statement. Those who made it through the statement and still felt like reading, realized that the end of QE was not as finalized as one may have expected.

2014-11-11 The Return of the Dollar by Mohamed El-Erian of Project Syndicate

The recent dollar rally, the result of genuine economic progress and divergent policy developments, could contribute to the rebalancing that has long eluded the global economy. But that outcome is far from guaranteed.

2014-11-11 Switzerland: Vote Yes on Gold Initiative by Axel Merk of Merk Investments

On November 30th, the Swiss are voting whether to amend their countrys constitution on an initiative entitled Save our Swiss Gold. The Swiss gold initiative appears widely misunderstood, both inside and outside of Switzerland. We discuss implications for gold, the Swiss franc and Switzerland as a whole.

2014-11-11 Factors: An Essential Part of Any Nutritious Portfolio by Adam Butler, Mike Philbrick, Rodrigo Gordillo of Dundee Goodman Private Wealth

We recently posted a piece on factor investing so we were thrilled to have an opportunity to see Dr. Andrew Ang and Don Raymond discuss factor investing at a seminar in Toronto last week.

2014-11-11 The Opportunity in Japan is Not Over by Christopher Gannatti, of WisdomTree

We believe that the ultimate success of Abenomics will be judged over a period of multiple years, and while certain actionsespecially those from the Bank of Japanhave been significant, others, like structural third arrow reforms, will take time.

2014-11-11 The 5 Es for Equity Investors by Kristina Hooper of Allianz Global Investors

As we move closer to the end of 2014, there are some key considerations that will wield significant influence over the stock market, writes Kristina Hooper.

2014-11-10 Maintaining a Consistent Portfolio Approach by (Article)

Maintaining a consistent portfolio approach—even during times when our style of investing may fall out of favor with the market—is a critical element of the Royce philosophy.

2014-11-10 Countering Three Investor Biases by Shundrawn Thomas, Head of Funds and Managed Accounts, Northern Trust Asset Management (Article)

Shundrawn Thomas discusses strategies to counter common investor biases around concentration of risk, compensation for risk, and explicit versus implicit costs.

2014-11-10 Buyer Beware: Jobs? WHAT Jobs?! by John Del Vecchio of AdvisorShares

While many market observers debate whether quantitative easing (QE) worked the general consensus appears to be that the lower unemployment rate is a positive result of the Federal Reserves policies. Recently the unemployment rate hit 5.9%, the lowest since 2008. However, in our view, that is highly misleading with respect to the effectiveness of QE. The chart below shows the labor force participation rate as well as the percentage of people employed relative to the population.

2014-11-10 Dollar, China and Brazil In The Short Or Medium Term by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

The Dollar Index is approaching two important and converging barriers for its recent uptrend. The Shanghai Composite Index is also bordering the top of its channel. Brazil lost a good chance at recent elections to recycle its unsuccessful policies and government. But technical analysis may show some relief for optimism in Brazilian stocks and the EWZ ETF.

2014-11-10 Eurozone 2015 Economic & Capital Market Outlook by Gregory Hahn, Marco Carvajal of Winthrop Capital Management

Five years after the financial crisis, the Eurozone is facing major challenges in restoring economic growth. The Eurozone is faced with numerous structural problems, high unemployment, excess capacity, stagnant wages, slow banking reform, declining manufacturing, low level of capital investment and the uncertainty of Russian foreign policy. The result is that member countries are struggling to comply with the original terms of the European Union and running budget deficits in order to stimulate growth within their countries.

2014-11-10 Ebola and Inequality by Joseph Stiglitz of Project Syndicate

The Ebola crisis reminds us, once again, of the downside of globalization. And, though governments may not do a perfect job in addressing such crises, one of the reasons that they have not done as well as we would hope is that we have underfunded the relevant agencies at the national and global level.

2014-11-10 Change Is In The Air by Brian Wesbury, Robert Stein of First Trust Advisors

While many flay away, trying to figure out the meaning of last weeks GOP wave election, it seems simple. The government has tried for more than five years to turn a Plow Horse economy into a Race Horse, and failed. Yes, the economy is growing and creating jobs, but living standards are growing slowly, or not at all, for many.

2014-11-10 Tracking the Market with Social Media by Blair Jensen of Trade Followers

The Trade Followers Momentum indicator for the S&P 500 Index (SPX) has been drifting sideways over the past few weeks. This drift comes near levels that have often meant some consolidation in price is warranted. However, traders on Twitter are now tweeting higher price targets. This gives the market a chance to drift to the 2040 or 2050 area while 7 day Twitter and StockTwits momentum move up into overbought readings.

2014-11-10 Do the Lessons of History No Longer Apply? by John Hussman of Hussman Funds

Without permanent changes in the way the world works, on valuation measures that are best correlated with actual subsequent market returns, stocks are wickedly overvalued here. Meanwhile, the stock market re-established overvalued, overbought, overbullish conditions last week that mirror some of the most precarious points in the historical record such as 1929, 1937, 1974, 1987, 2000 and 2007. Notably, that syndrome is now coupled with continued evidence of a subtle shift toward more risk-averse investor psychology, primarily reflected by internal dispersion and widening credit spreads.

2014-11-10 Three Reasons Why Commodity-Related Debt May Hold Value Under Pressure by Kathleen Gaffney of Eaton Vance

In this timely Insight, Kathleen Gaffney discusses how a flexible multisector bond strategy can be a great way to gain exposure to, and take advantage of, potential value opportunities in hard-hit commodity related debt.

2014-11-10 Emerging Markets Trends: Whats Negative for One Market May Boost Another by Steve Cao of Invesco Blog

Economic conditions have continued to deteriorate in emerging markets, and corporate earnings forecasts have fallen. Overall, emerging markets were down 4.3% in the third quarter, underperforming the developed world. In the midst of this negative news, however, were seeing a few bright spots start to emerge, and weve been able to add holdings that, in our view, became mispriced during market volatility.

2014-11-09 Weekly Market Summary by Urban Carmel of The Fat Pitch

It's hard to argue that the price action of US equities is not bullish. SPX and DJIA ended the week at new highs. NDX stayed near the new highs it made last week, apparently digesting its gains. NDX was flat for the week while SPX and DJIA added another 1%. This is mostly reflected at the sector level as well. Financials, technology, industrials and transports are cyclical leaders all making new highs this week. But what is curious is that the market is being led more by defensives. Staples, utilities and healthcare are also at new highs. Since the September 19 top, SPX has added 1%, but defen

2014-11-08 And the Winner isInvestors? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The pullback seen in October is now just a memory and stock indexes are again pushing into record territory. Seasonality and the election cycle are lining up with still solid earnings growth and an expanding economy to help support further gains. Complacency is a risk but we continue to believe the trend in US stocks is higher.

2014-11-07 Knowing What You Can't Know, Knowing What You Don't Know, and Staying Disciplined in Your Investment by Team of Litman Gregory

In our investment analysis and decision-making, we try to focus on what is knowable with a reasonable degree of certainty or within a reasonable range of outcomes. We also recognize the importance of staying within our circle of competency, which means not investing in things we don't fully understand. And while our investment discipline requires us to adapt and change our views if the facts and circumstances change, it also protects us against getting swept up in the short-term noise and emotions of the markets.

2014-11-07 Japanese Equities Look Better and Better by Nick Niziolek of Calamos Investments

Based on an intersection of bottom-up and top-down criteria, we've become increasingly constructive on Japan's equity market over recent months. Last week, the BOJ made a surprise announcement that it would increase its monetary target by 80 trillion and also purchase stock assets. Also significant was the BOJ's statement that it would consider buying exchange traded funds that track the Nikkei 400 Index, which should promote higher dividends, buybacks, and/or capex spending-all positive for equity markets and potentially for Japan's economy as well.

2014-11-07 It's The Economy, and They're Not Stupid by Peter Schiff of Euro Pacific Capital

The sharp rebuke to the Obama administration delivered by the mid-term elections should not be construed as an endorsement of the GOP, which remains as unpopular as ever. Rather, as has been the case in the last few election cycles, voter revolts have hinged on continued dissatisfaction with the strength of the economy and the diminishing financial prospects of ordinary citizens.

2014-11-07 Retirement Planning: Millennials vs. Boomers by Noah Beck of Research Affiliates

Rob Arnott and Lillian Wu recently wrote that young workers are more likely than older ones to lose their jobs in an economic downturn.They are also prone to draw on their 401(k) plan to meet basic living expenses while they are unemployed. Given these facts, the early-phase concentration in equitieswhose market prices are roughly correlated with the business cyclemakes target-date funds inordinately risky for young investors. In this article, Noah Beck considers TDFs in the broader context of workers total assets, including their own human capital.

2014-11-07 Central Planners Are In A State of Panic by Chris Martenson, of

By the time a central bank is behaving as recklessly as Japan, it's time to edge towards the exit, because the chance of a flash fire in the building has grown uncomfortably high. That is, instead of providing comfort, these most recent moves should invoke greater worry for those of us alert enough to see them for what they are: acts of panic:

2014-11-07 Election Impact on Oil by Tim Gramatovich of AdvisorShares

The tally is in and it was a very bad evening for the Democratic party. Senate races in Iowa, North Carolina, Georgia and a host of other States went red. Alaska is still to be determined (likely Republican) and Louisiana is slated for a run off. All told, it looks likely the Republicans have garnered a solid majority in the Senate (up to 53-54 seats) and the biggest majority in the House (over 246 seats and counting) since Truman 60 years ago. This certainly seems to have surpassed the nightmare scenario envisioned by the Dems. While the markets may enjoy a honeymoon rally, it always fades.

2014-11-07 Gold in Yen Calm in the Eye of a Storm by Ade Odunsi of AdvisorShares

Since the beginning of August there has been a striking divergence in the relative performance of gold priced in US dollars versus gold priced in yen. Gold in yen has outperformed its dollar cousin by just over 10% over a period of three months. In fact year-to-date gold priced in yen has returned +5.3% with a 10.7% annualized standard deviation while gold in dollars has returned -2.6% with a 12.5% annualized standard deviation.

2014-11-07 Reconsidering Asia's Currencies by Gerald Hwang of Matthews Asia

The Asian Financial Crisis of 1997-1998 looms like a ghost over any attention to Asian currency risk. But what new considerations are needed now? Given the robust performance of the regions currencies since 1999, Portfolio Manager Gerald Hwang, CFA, explores this topic in a modern context that takes into account the diverse monetary systems, business cycles and development stages of Asias economies.

2014-11-07 Building a Database of Quality Businesses by (Article)

Small-cap equities form the largest domestic equity universe, accounting for approximately 80% of all publicly traded companies in the U.S. In such a large and diverse space, how do we attempt to identify companies with the quality characteristics we typically seek? Portfolio Manager Steven McBoyle explains how we uncover and monitor businesses within our chosen asset class based on three key investment tenets and careful due diligence.

2014-11-07 The ETF Trader Interview Series: Aaron Kehoe, Cantor Fitzgerald by Anita Rausch of WisdomTree

In this edition, Anita Rausch, Director of Capital Markets, speaks with Aaron Kehoe, Managing Director and Head of Fixed Income ETF trading at Cantor Fitzgerald. Aaron joined Cantor in September 2013 and focuses primarily on managing and trading the firms book of fixed income ETFs. In addition, Aaron was instrumental in the product launches of many new fixed income ETFs and all senior loan ETFs.

2014-11-07 There is No U.S. Bear Stock Market in Sight by Robert Lamy of The Forecasting Advisor

After increasing by 15.5% between February 3rd, 2014 and September 18th, 2014, the U.S stock market began to decline on September 19th and during the following four weeks. The S&P 500 price index fell by 7.4% during that period and stood on October 15th at its lowest level in six months. This was the fourteenth correction of the index since the start of the current bull market in April 2009. The decline was followed by a strong rebound during the past three weeks.

2014-11-07 5 Things To Ponder: GOP Takes Control by Lance Roberts of Streettalk Live

This past Tuesday the conservative Republican candidates garnered a resounding victory over their Democratic challengers in even some of the "bluest" states. The message that was sent by voters was quite clear: "The real economy sucks."

2014-11-07 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company

My first draft of this letter, which I wrote three weeks ago began with: Europe has not solved its problems; Nor has Japan; Nor has China; Nor has the U.S. The rest of that draft is now obsolete. Since mid-September, several items have changed-some economic, some market-related, some psychological.

2014-11-07 Weekly Market Summary by Carl Tannenbaum of Northern Trust

The mid-term elections: A new cast faces old problems; Japan: Kuroda's Halloween surprise; The U.S. has very solid job growth but not much wage growth

2014-11-07 The Investing Evolution: How We Got Here by Robert Isbitts of Sungarden Investment Research

One of the main themes of the Schwab Impact conference was the urgency the industry feels to go beyond traditional asset allocation. I could not agree more with that concept. But as for the execution of it, I see what I have seen so many times beforea good idea to help investors, which the industry then bludgeons to death with complexity, excessive fees and a bunch of me-too products. I will devote much more space in this blog to this in the coming weeks and months.

2014-11-07 Winners and Losers of the Dollars Recent Ascent by Russ Koesterich of BlackRock

The dollar recent rally can be attributed to a number of factors including a relatively solid U.S. economy, diverging central bank policies (the U.S. is preparing to tighten while the European Central Bank and the Bank of Japan are easing), and long-term changes in trade flows, particularly around the energy sector. We expect most of these trends to continue, and here are three key implications of a rising dollar.

2014-11-07 'Risk On' for Now by Scott Minerd of Guggenheim Partners

U.S. high-yield bonds, leveraged credit, and equities will likely outperform in the coming months, but there are obstacles ahead.

2014-11-06 by Doug Short (Article)

It's been quite a while since I last updated the "Sweet Sixteen" inflation-adjusted Dow recoveries that I've been illustrating from time to time over the past five years. With yesterday's record close as an aftermath to the mid-term election results, it seems appropriate to have a look at the recovery since the Great Recession in the larger historical context of market recoveries.

2014-11-06 Whither the Consumer? Taxation Impacts by Stephen Roseman of Calamos Investments

We believe the U.S. consumer is in a better position to spend this year. Our confidence reflects: 1. Recent non-farm employment numbers were near all-time highs. 2. Home values have largely recovered to their pre-crisis highs. 3. While volatility has been top of mind these past weeks, consumers have benefited from a five-and-a-half-year bull market. 4. Consumer confidence, highly correlated to consumer spending, has been rising, steadily but choppily, since the 2009 bottom. In this post, we look at impacts of taxation on the consumer landscape.

2014-11-06 Will Rates Rise, Stay Steady or Fall Further? by Steve Rumsey of Optimus Advisory Group

As interest rates fell over the past 30 years, bond investors enjoyed substantial gains due to the subsequent rise in bond prices.

2014-11-06 When Volatility Rises, So Have Active Management Relative Results by Team of The Royce Funds

For many investors, volatility is often synonymous with risk. We as value investors (and risk managers), on the other hand, have always viewed volatility as a crucial component of active stock selection. In our latest Royce Research piece, we explore the relationship between low- and high-volatility environments and the relative performance of active managers versus their respective benchmarks during these periods. This deep dive is especially important in a market that has recently seen more volatility and its largest correction in almost three years.

2014-11-06 ISM Data Point to Strong GDP Growth in Q4 by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) released data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers, and the media as they provide the earliest reading on the current state of the economy.

2014-11-06 Believing Anything by Keith McCullough of Hedgeye Risk Management

For those of you who didnt know that Cockburn was a British journalist and proponent of communism , now you know. His aforementioned quote was cited by Jim Rickards at the beginning of an excellent chapter titled Prophesy in The Death of Money.

2014-11-06 A Republican Congress Awaits But First the Lame Duck Session by Andy Friedman of The Washington Update

Destiny became reality in the midterm elections as the Republicans gained a majority of the Senate and widened their lead in the House to historic proportions. The Republicans now must decide the mix of confrontation and collaboration that will define their leadership. Due to variations in beliefs and campaigning strategies, the rank-and-file members of the two chambers might see this ideal mix differently. A new update discusses the dynamics surrounding the election and enumerates the items Congress must address in the lame duck session taking place in December.

2014-11-06 Emerging Europe: Regional Economic Review - Q3 2014 by Team of Thomas White International

While Russia has been experiencing a slowdown for quite some time, the new round of sanctions imposed by the West has hit the economy even harder.

2014-11-06 Global Economic Overview: September 2014 by Team of Thomas White International

Global economic growth concerns resurfaced during the month of September, as data from the Euro-zone suggested that select large counties yet again face recession. Even Germany, the bulwark that shielded the common currency area during the fiscal crisis, has slowed down as subdued external demand has taken a toll on exports.

2014-11-06 What Stimulus Overseas could mean for U.S. Investors by Russ Koesterich of BlackRock

Could the end of easy money in the United States be the beginning of even more stimulus everywhere else? Russ explains.

2014-11-06 3 Things Worth Thinking About, Including the Odds of a Suckers Rally by Lance Roberts of Streettalk Live

Each week in my weekly newsletter I do a complete overview on major markets, sectors and other market areas such as interest rates, gold and oil. I bring this up because the recent melt-down in oil and energy related stocks is something that I warned about in early August of this year.

2014-11-05 Japan's Kaput?! by Axel Merk of Merk Investments

Japans economy is down but not yet out. The worlds third largest economy wont go quietly. Both these statements are merely my opinion, but if you believe theres a risk that Im right, you may want to pay attention to what the implications may be.

2014-11-05 QE Worked, But Not As Advertised by Zach Pandl of Columbia Management

Last week the Federal Reserve announced the end of its bond-buying program, which has been running with only brief interruptions for the last six years. Besides its ultimate size and duration, the striking thing about the Feds experiment with quantitative easing (QE) is that there is still not a firm consensus on exactly how it worked. Academic economists will be busy with this question for years. But from a bond investors point of view, theres enough evidence to make a few tentative conclusions.

2014-11-05 Hong Kong: Looking at Commercial Rental Prices and Automotive Demand by Dilip Badlani of The Royce Funds

Hong Kong is a very important market to Royce's international efforts, though its economy has seen a significant slowdown over the past several years. Royce International Micro-Cap Fund Portfolio Manager Dilip Badlani discusses why he returned after having recently visited earlier in the year and what he learned from his meetings with company management teams.

2014-11-05 What a Rising Dollar Means for Your Stock Portfolio by Jeremy Schwartz of WisdomTree

Typically, if a companys home currency is weakening compared to the currency where the companys sales are generated, this will have a positive effect on sales and profitability, and if the home currency is strengthening, it could negatively impact sales and profitability.

2014-11-05 Recession Probability Models - November 2014 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession. While I dont agree with the methodologies employed or probabilities of impending economic weakness as depicted by the following two models, I think the results of these models should be monitored.

2014-11-05 A Look behind the GDP Numbers: The Search for Organic Growth by Bob Andres of Andres Capital Management

As with many investors, we looked anxiously to the U.S. GDP release on Thursday morning after viewing the FOMC statement on Wednesday. When the headline number for GDP came out at the top range of the forecast at 3.5%, we began to ask ourselves whether the analysts projecting 3% inflation by year end may actually be on to something. However, upon reading the report, we became less enthralled with the prospect of above trend growth, which would signal rising inflation.

2014-11-05 CEF Snapshot Featuring Cara Esser by (Article)

Closed-end funds run by “rock star” managers have both advantages and disadvantages to consider, says Cara Esser of Morningstar.

2014-11-04 The Six Biggest Washington Myths by Justin Kermond (Article)

If you think Washington is hopelessly broken or that the Federal Reserve is bitterly divided between hawks and doves, you're wrong, according to Greg Valliere. These were two of six common assertions Valliere challenged in a talk last week.

2014-11-04 Why Advisors Can't Find Skillful Active Managers by Michael A. Ervolini (Article)

Despite years of wrangling over skill versus luck, no one really knows much about skill, and that is at the heart of the problem.

2014-11-04 Martin Wolf on the Financial Crisis: The Fire Next Time by Michael Edesess (Article)

If you think the global financial crisis of 2007-2009 was a one-time event caused by lax regulation and a financial industry run riot, then Financial Times chief economics commentator Martin Wolf has some bad news for you. Wolf, one of the world's most respected economists, says these circumstances were only part of its proximate cause and that the financial crisis was the inevitable product of the global economic system. If that system does not undergo radical change, says Wolf, financial crises may keep on recurring until the world economic order collapses.

2014-11-04 How to Get Prospects off the Fence by Dan Richards (Article)

Today's column outlines four ways to get prospects off the fence.

2014-11-04 The Critical Importance of Evidence-Based Persuasion by Daniel Solin (Article)

The disconnect between the rigorous, peer-reviewed data we require before making investment recommendations and the lack of comparable data when converting prospects into clients is an anomaly worthy of discussion.

2014-11-04 Identifying and Communicating Your Key Differentiators by Kristen Luke (Article)

Let's look at how advisors can communicate the ways in which they are different - a common struggle for many firms.

2014-11-04 Four Keys to Making Your Partnership Work by Beverly Flaxington (Article)

My partner and I merged our practices about a year ago. It seemed like a great idea that would take us to the next level, but I've become frustrated with some of his ideas and work habits. We still get along but the tension is growing. I'm starting to think this merger was a mistake.

2014-11-04 It's Time to Shift from Pink to Purple by Sponsored Content from Transamerica (Article)

With the end of National Breast Cancer Awareness Month in October, we turn our attention to National Alzheimer's Disease Awareness Month and National Caregiver Month in November. Throughout the month, the New Age of Advice will feature blog posts with insights about Alzheimer's designed to help advisors gain a better understanding of this devastating disease.

2014-11-04 Black Dog: Are Plunging Oil Prices a Positive or a Negative? by Liz Ann Sonders of Charles Schwab

The bear market in oil prices is largely a positive for the consumption-oriented US economy, but there are caveats. Oil's plunge is more a function of increased supply and the stronger US dollar than it is of weaker global demand. Oddly, many investors are worried about the stock market because of oil's plunge; but history suggests otherwise.

2014-11-04 Cameron Uses EU Fine to Bolster Support by John Browne of Euro Pacific Capital

Last week, the unelected European Commission demanded that the United Kingdom pay an additional $2.8 billion to fund the European Union. The new charges resulted from the fact that the British economy had grown faster than had been expected in the past year. The demand sparked outrage from Great Britain's Prime Minister, David Cameron, and media, particularly as France and Germany would receive rebates, financed largely by the new funds being demanded from the UK.

2014-11-04 The Race by Brian Andrew of Cleary Gull

While some may wish for a Democratically controlled Congress because we have a Democrat in the White House, the reality is that some dysfunction between Congress and the Administration is welcome by markets. Near-term, many believe that the regulatory environment created by a Democratic Senate and Administration creates uncertainty and restricts corporate growth. While that may be true, it is hard to argue with the stock market returns over the last several years. The reality is that markets appreciate some dysfunction in Washington.

2014-11-04 Bear Markets, Corrections, and Benchmarks by Kendall Anderson of Anderson Griggs

Since the last day of 1926 through today, the S&P 500 has had a total of eight bear markets. This is assuming a bear market is one with a decline of 20% or more. Since it has been eighty-five years since the first of these great bear markets, and five since the bottom of the last one, it might be interesting to see some details on each. Lets take a trip down memory lane.

2014-11-04 Outrunning the Bear: An Active Managers Survival Guide by William Smead of Smead Capital Management

Two long-time friends go up in the mountains on a hunting trip. At 4:30 A.M. of the second day, one of the men wakes up at one end of the tent to find his buddy dressing and putting on his running shoes at the other end. He asks him what he is doing. His friend says, There is a bear outside our tent. The other guy exclaims, You cant outrun a bear! His friend replies, I dont have to outrun the bear, I just have to outrun you.

2014-11-04 Snail Trail Vortex by Niels Jensen of Absolute Return Partners

The world is undergoing a radical shift towards lower economic growth at the moment. Some of the dynamics driving growth down are structural in nature (e.g. demographics), and even the most extreme monetary or fiscal policy will not change that. We are in for a period of lower, but still positive, global growth whether we like it or not. Despite the somewhat muted outlook, we continue to expect significant regional variations in growth and therefore also in interest rates and equity returns.

2014-11-04 Double Dose of Stimulus Sending Japan Stocks Up, Yen Down by Jeremy Schwartz of WisdomTree

On October 31, the Bank of Japan (BOJ) unleashed a surprise round of further stimulus to its monetary policies. This additional monetary easing occurred the same week that the U.S. Federal Reserve (Fed) completed its monetary policy program, showing a transition in global central bank accommodation leadership.

2014-11-04 The Macro Playbook by Darius Dale of Hedgeye Risk Management

The Hedgeye Macro Playbook aspires to present investors with the robust quantitative signals, well-researched investment themes and actionable ETF recommendations required to dynamically allocate assets and front-run regime changes across global financial markets. The securities highlighted above represent our top ten investment recommendations based on our active macro themes, which themselves stem from our proprietary four-quadrant Growth/Inflation/Policy (GIP) framework.

2014-11-04 So What Happened Last Month? by Team of GaveKal Capital

October was certainly a rollercoaster ride in the equity markets but it was a ride that ended right where it started. The average stock in the MSCI World Index was up 13 basis points over the past month.

2014-11-04 Three Words for Brazil by Mark Mobius of Franklin Templeton Investments

As long-time investors in Brazil, the recent presidential election has been of keen interest to us. One can certainly say its been an interesting race! The market had been volatile based on the changing polls leading up to the election; there were hopes that new leadership would ignite a positive new direction for Brazils economy, which hasnt experienced the type of economic boom many (including us) had hoped forand believe is possible.

2014-11-04 Consumer Confidence Hit a 7-Year High in October... But by Gary Halbert of Halbert Wealth Management

The two most widely-followed indicators of consumer confidence jumped to the highest levels in seven years last week. The Conference Board reported Tuesday that its Consumer Confidence Index climbed to 94.5 in October, the strongest reading since October 2007 before the economy entered the Great Recession.

2014-11-04 Rhyme and Reason by John Mauldin of Mauldin Economics

We?ll revisit the phenomenon of October as a month of negative market surprises. It actually has its roots in the interplay between farming and banking.

2014-11-04 Emerging Markets Equity Commentary: September 2014 by Team of Thomas White International

Emerging market equity prices corrected in September on concerns about weaker global growth even as the U.S. Federal Reserve is set to wind down its bond purchases. Signs of yet another downturn in the Euro-zone economy are likely to hurt the export outlook for the major emerging countries that had seen a modest improvement in exports in recent months.

2014-11-04 International Equity Commentary: September 2014 by Team of Thomas White International

International equity prices corrected in September as investors became concerned about slower global growth and the continued withdrawal of monetary stimulus by the U.S. Federal Reserve. Stronger than expected U.S. growth could support the global economy in the coming quarters, but has made investors anxious of early interest rate hikes. The Euro-zone economic recovery is faltering yet again as growth has slipped in most large countries.

2014-11-04 Americas: Regional Economic Review - Q3 2014 by Team of Thomas White International

The clear divergence in economic growth trends between the developed economies in North America and Latin America widened during the third quarter. The U.S. is now the fastest growing developed country in the world, and has lifted the outlook for Canada and Mexico, two of its major trading partners in the region.

2014-11-03 Financial Markets Update by (Article)

Bill McQuaker and Paul O'Connor, Co-Heads of Multi-Asset and Lead Portfolio Managers for the Henderson All Asset Fund, provide their thoughts on what is happening around the world and how recent developments have affected financial markets. They also share insights into the positioning of the Henderson All Asset Fund and how they have reacted to the recent sell-off in financial markets. Further, Bill and Paul highlight the most important developments and risks that they are watching out for into early 2015.

2014-11-03 Your Value Proposition: Become a Trusted Advisor by (Article)

You have a meeting with a HNW prospect and don’t have a lot of time to prepare. How do you expertly assess current risks that the prospect is facing and position yourself as a trusted advisor? Run the portfolio through series of stress tests and present them in a Portfolio Crash Test report. Let client determine their 'sleep-at-night' loss number and create a suitable portfolio that is based on client preferences. Do all of that interactively with stunning visualizations. Watch the client sign the transfer form.

2014-11-03 Worried About the Unknown? Focus on the Business Cycle Instead by John Greenwood of Invesco Blog

Lately, Ive been fielding questions about the possible unknowns that could bring about the end of the current economic expansion. While I understand investors trepidation about the unknown, I believe this concern is misplaced. Business cycles do not generally end because of unforeseen accidents. They normally end because central banks, in an effort to bring down inflation, raise interest rates, which creates an inverted yield curve and slows money and credit growth. We are clearly a long way from this scenario at present.

2014-11-03 Celebrity Central Bankers by Kenneth Rogoff of Project Syndicate

Major central banks growth and inflation forecasts in the years since the financial crisis have consistently overestimated both growth and inflation and by wide margins. So why do the comments of major economies central bankers command outsize attention?

2014-11-03 Is the Stock Market Cheap? by Doug Short of Advisor Perspectives (

Here is a new update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month, which is 1,937.27. The ratios in parentheses use the monthly close of 2,018.05. For the earnings, see the table below created from Standard & Poor's latest earnings spreadsheet.

2014-11-03 Losing Velocity: QE and the Massive Speculative Carry Trade by John Hussman of Hussman Funds

What central banks around the world seem to overlook is that by changing the mix of government liabilities that the public is forced to hold, away from bonds and toward currency and bank reserves, the only material outcome of QE is the distortion of financial markets, turning the global economy into one massive speculative carry trade. The monetary base, interest rates, and velocity are jointly determined, and absent some exogenous shock to velocity or interest rates, creating more base money simply results in that base money being turned over at a slower rate.

2014-11-03 Economy, Earnings and Policy Push Equities to New Heights by Robert Doll of Nuveen Asset Management

A combination of receding global growth fears, strong corporate earnings results and continued monetary policy support helped U.S. equities rise for a second week, with the S&P 500 Index climbing 2.7%.

2014-11-03 Digging Deep for Value in Volatility by Grace Hoefig of Franklin Templeton Investments

Selloffs like those seen recently in US equities have provided a respite from soaring share prices for deep value investors, and they have been out in force, scouring the markets for quality stocks at bargain prices. Grace Hoefig, research analyst and portfolio manager for Franklin Equity Groups US Value Equity team, says that recent stock market dips have presented value opportunities in some market sectors, but, as through all market conditions, a little patience and a lot of research and flexibility are required to uncover them.

2014-11-03 Clarifying Confusion: American Depository Receipts (ADRs) Have Currency Risk by Jeremy Schwartz of WisdomTree

It is a common misconception that, because an ADR is traded in U.S. dollars in the United States, there is no exchange-rate risk. But thats not the case. Heres why.

2014-11-03 The Trouble with Porosity and Prosperity by William Gross of Janus Capital Group

I am a philosophical nomad disguised in Western clothing, a wondering drifter, masquerading in a suit near a California beach. Sand forms the foundation of my being and its porosity is at once my greatest strength and deepest wound. I have become after 70 years, a man who believes that no belief is sacred. I have ideals and moral standards, but I believe them specific to me. Had I inherited your body and ego, I could just as clearly have assumed "yours." If so, I wonder, if values are relative, then what are mortals to make of them, and what would a judging God make of

2014-11-02 Weekly Market Summary by Urban Carmel of The Fat Pitch

A number of studies show a poor risk/reward profile in the near term for US equities. That does not mean that equities will fall. This market has shown a strong propensity to defy precedents. This might well be another such situation. The question for us is always risk vs reward. We believe the odds of a 5% rally appear much smaller than those for a 5% retracement. Therefore, initiating new longs here is uninteresting.

2014-11-02 Weighing the Week Ahead: What the End of QE Means for the Individual Investor by Jeff Miller of New Arc Investments

Pulling this all together, Abnormal Returns explains what the individual investor should do create a personal margin of safety. Tadas uses his broad knowledge and experience to pull together advice from several leading sources. If you had followed this approach over the last few years, you would have been able to stick with your program during the tough times. It will be of equal help in the future.

2014-11-01 The Single-Engine Global Economy by Nouriel Roubini of Project Syndicate

The global economy is like a jetliner that needs all of its engines operational to take off and steer clear of clouds and storms. Unfortunately, only one of its four engines is functioning properly, the pilots must navigate menacing storm clouds, and fights are breaking out among the passengers.

2014-11-01 Point and Go Figure by Robert Isbitts of Sungarden Investment Research

I will admit that Point and Figure (P&F) charting is not something I have spent years studying. I do know that according to Investopedia and other sources I have read recently, it is gaining followers. P&F charts tend to be longer-term in their view, and they project and name an actual price target for the stock or index you are tracking.

2014-11-01 Dont Be Spooked by Market VolatilityOpportunity Is Still Knocking! by Frank Holmes of U.S. Global Investors

One of the greatest fears this Octoberpossibly the most volatile month of the yearhas been the correlation between the S&P 500 Indexs ascent in the first three quarters of the year and the possible ramifications of the end of quantitative easing (QE).

2014-10-31 Trick or Treat? Slow Global Growth Hits Cyclical Sectors Hardest by Francis Gannon of The Royce Funds

As of October 13, the small-cap Russell 2000 Index was down 12.9% from its 2014 high on July 3a double-digit correction not seen in more than three years. With the U.S. economy slowly improving and Fed tapering winding down as scheduled, what is driving this pullback? Co-Chief Investment Officer Francis Gannon talks about economic growth beyond our borders and how it has been playing a role in shifting investor sentiment.

2014-10-31 Buyer Beware: A Notable Divergence by John Del Vecchio of AdvisorShares

As a short selling portfolio manager, we constantly monitor market relationships for positive or negative divergences in the broad equity market indexes. One of the most important relationships is that between price and volume. In a bullish scenario, one would want to see volume expand as price rises.

2014-10-31 Small Cap leverage by Jun Zhu of The Leuthold Group

Small Caps' balance sheets and debt servicing capacity are not in the healthiest state to weather higher interest rates (relative to Large Caps). This could be part of the big picture of weakening Small Cap performance. Small Cap investors should place an emphasis on companies with relatively stronger balance sheets, and higher earnings power in order to accommodate an environment of rising interest rates. With the Fed mulling over a rate increase, investors may have already started to avoid companies with excess leverage. Unfortunately, Small Caps, on average, are in this camp.

2014-10-31 Quick Hit on Q3 GDP: #QUAD4 Confirmed by Darius Dale of Hedgeye Risk Management

With this [soon-to-be-revised-down, pre-election Q3 GDP print], the U.S. economy is squarely in #Quad4 and should remain there throughout Q4

2014-10-31 A New Breed of Robotics by Kenichi Amaki of Matthews Asia

Are collaborative robotsindustrial robots made to better work alongside humanslikely to be well-received in the market? How feasible is a car made from a 3D printer? This week Portfolio Manager Kenichi Amaki discusses his findings from the International Manufacturing Technology Show in Chicago.

2014-10-31 Financial Markets Review Third Quarter 2014 by Team of AMG Funds

Similar to earlier this year, the third quarter featured further evidence of a multi-speed economic recovery across the globe. Central banks reacted in a less-than-coordinated fashion compared to years prior, with the European Central Bank (ECB) and the Bank of Japan (BOJ) loosening monetary policy while the U.S. Federal Reserve (the Fed) retained more of its status quo as detailed further here.

2014-10-31 5 Things To Ponder: "Spooky" Things by Lance Roberts of Streettalk Live

I love this time of year, in particular it is the festivities surrounding one of the biggest commercial shopping days of the year - Halloween. According to Wikipedia:

2014-10-31 Weekly Economic Commentary by Team of Northern Trust

Stress testing is performed in a number of arenas. Tools and parts are stressed to ensure that they will stand up to extreme conditions. Medical patients are stressed to detect heart disease. Computer systems are stressed to ensure that they can operate stably at peak times.

2014-10-30 Recovery Reality by John Canally of LPL Financial

The U.S. economy is improving, and in many cases is back to normal, but it remains stubbornly weak in some areas. Real world indicators that point to the health of the economy include crane rental rates and customer traffic in restaurants. Economic uncertainty -- likely a drag on economic growth in 2011, 2012, and 2013 -- has faded as a concern in 2014, consistent with the Feds most recent Beige Book.

2014-10-30 Got Loans? by Mark R. Kiesel, Elizabeth (Beth) MacLean, Rudy Pimentel of PIMCO

?We believe select investors looking to reposition portfolios may benefit from a move to senior secured floating rate loans. CLOs have been an important source of demand in the market, and even with more strict risk retention rules just announced under Dodd Frank, we think demand will remain strong. While the Fed has criticized some banks for not following their leveraged lending guidelines, Fed members themselves, in our view, do not appear concerned about loans having a major impact on financial stability.

2014-10-30 Newsletter by Harold Evensky of Evensky & Katz

Harold Evensky presents his quarterly newsletter.

2014-10-30 Stay the Course in Small Caps by Jonathan Coleman of Janus Capital Group

Small-cap stocks sold off in the third quarter, but now is not the time to abandon the market cap segment. In this article, Jonathan Coleman, Co-Portfolio Manager of the Janus Venture Fund, gives his perspective on current small-cap valuations, and why an allocation to small caps is beneficial in an environment where the U.S. economy is on stronger footing than the rest of the world.

2014-10-30 How Exchange-Traded Futures Can Improve the Efficiency of Gold & Currency Linked ETFs by Ade Odunsi of AdvisorShares

With a number of gold and currency linked ETFs now using exchange traded futures to gain their gold and currency exposure versus the alternative of holding physical gold/hard foreign currency, we discuss below some of the key features of these futures markets which, in our view, mitigate most if not all of the concerns investor may have about these futures based ETPs.

2014-10-30 The ETF Trader Interview Series: Kathryn Sweeney, Goldman Sachs by Anita Rausch of WisdomTree

In this edition, Anita Rausch, Director of Capital Markets, speaks with Kathryn Sweeney, the Global ETF Product Manager and Head of U.S. ETF Trading for Goldman Sachs.

2014-10-30 The Week That Was by Jeffrey Saut of Raymond James

In the June 26th edition of the Morning Tack, Jeff Saut wrote, I do believe the VIX bottomed last Friday (6/20/14) with an undercut low, much like the undercut low of October 4, 2011 that we identified as the valuation low, and recommended should be bought with the SPX trading back then at 1075. Well that proved to be fitting timing, since from that 6/20 low to the high on Wednesday 10/15, all the VIX did was shoot up about 200%!

2014-10-30 Income Inequality and Fed Policy by Scott Brown of Raymond James

Income inequality has been an important topic this year, but it is one that is mired in politics. That means it is a potentially treacherous debate for the Federal Reserve chair to wade into. To be fair, Yellen said that the purpose of her recent talk on income inequality and opportunity was not to provide answers to these contentious questions, but rather to provide a factual basis for further discussion. She provided a mountain of evidence from the Feds triennial Survey of Consumer Finances, and then got out of the way, as appropriate.

2014-10-30 Europe Must Act Now by Scott Minerd of Guggenheim Partners

Things in Europe are bad and policymakers appear already to have fallen behind the curve. The reality is the ECB will need to purchase at least another 1.5 trillion in assets, and even that may not be enough to avert a severe slowdown.

2014-10-30 How In-Depth Accounting Analysis Helps Find Good Investments by Charlie Dreifus and Dave Gruber (Article)

Principal Dave Gruber talks with Portfolio Manager Charlie Dreifus about his 40+ year investment process and the importance of Abe Briloff's tutelage on his discipline.

2014-10-30 ETF Industry Update by Shundrawn Thomas, Head of Funds and Managed Accounts, Northern Trust Asset Management (Article)

Shundrawn Thomas discusses key trends in the ETF industry, including investor adoption, new market entrants, and developments in actively managed ETFs.

2014-10-29 Corporate Calm by Burt White, Jeffrey Buchbinder of LPL Financial

We remain confident in corporate Americas ability to generate solid earnings growth in the current global economic environment despite the slowdown in Europe (and to a lesser extent, China). A number of U.S. companies have performed relatively well in Europe, with some not yet seeing signs of a slowdown in their business. The business environment overseas appears to be good enough for companies to largely maintain their outlooks for the rest of the year and into 2015.

2014-10-29 Americans Even More Pessimistic Ahead of Elections by Gary Halbert of Halbert Wealth Management

Republicans remain in a favorable position heading into the midterm elections. A new Wall Street Journal/NBC News poll released on Sunday showed that the GOP now holds an 11-point lead among likely voters. Thats up from only a 5-point lead a week earlier. Some 52% of likely voters want a Republican-led Congress, while 41% favor Democratic control.

2014-10-29 Greenspan: Price of Gold Will Rise by Axel Merk of Merk Investments

Any doubts about why I own gold as an investment were dispelled last Saturday when I met the maestro himself: former Fed Chair Alan Greenspan. Its not because Greenspan said he thinks the price of gold will rise I dont need his investment advice; its that he shed light on how the Fed works in ways no other former Fed Chair has ever dared to articulate. All investors should pay attention to this. Let me explain.

2014-10-29 A Low in Positive European Earnings Revisions? by Team of GaveKal Capital

It's tough to find a great deal of optimism in or about European equities these days.

2014-10-29 As the Market Rebounds, Two Opportunities Bubble to Top by Russ Koesterich of BlackRock

Stocks staged a strong rebound last week. Russ discusses where he sees value in the market looking forward.

2014-10-29 Does Stock Picking Still Work in Emerging Markets? by Sammy Suzuki of AllianceBernstein

Many things have changed in emerging markets (EMs) over the last two decades. Markets are more efficient than they used to be. But we believe that developing countries still provide fertile ground for finding stocks poised to outperform.

2014-10-29 On Top of the Market by Team of AMG Funds

The third quarters seventh straight gain for the S&P 500 did not come easy. Investors wrestled with geopolitical turmoil in Ukraine and the Middle East, and the eventual end of the Federal Reserves (the Fed) bond buying program. U.S. small-cap stocks were volatile and fell into negative territory, year-to-date.

2014-10-28 How Moving Average Strategies Can Really Work by Jerry A. Miccolis, CFA®, CFP®, FCAS, CERA, Marina Goodman, CFA®, CFP® and Rohith Eggidi (Article)

In a previous article, Paul Allen explored the universe of moving average crossover (MAC) strategies. In his thorough and even-handed analysis, Allen concluded that MAC strategies can effectively decrease periodic drawdowns in portfolios but can materially underperform during bull markets. In this article, we propose how to improve MAC strategies so that they may perform better during bull markets and still provide protection during bear markets.

2014-10-28 A Framework for Superior Risk-Adjusted Returns: High Quality Stocks in Developed Markets by Baijnath Ramraika, CFA® and Prashant Trivedi, CFA® (Article)

A basket of high-quality stocks generates significantly superior investment returns compared to publicly traded benchmarks, and it does so with significantly lower risk.

2014-10-28 Why It's So Brutally Hard to Get Prospects to Move by Dan Richards (Article)

Two factors underlie the difficulty in getting prospects to make a change - the risk of pain is too great or the prospect of gain is insufficient. The good news is that there are some strategies that can overcome these obstacles.

2014-10-28 Third Quarter Review 2014 by Clark M. Blackman II (Article)

The following is a letter to clients that readers may adapt for their own use.

2014-10-28 Two Tips for Connecting Emotionally With Prospects by Daniel Solin (Article)

In my coaching practice, I often suggest that advisors drastically change the way they conduct meetings with prospects. Here are the two recommendations that I make most frequently.

2014-10-28 The Individual Investor's Edge by Patrick O'Shaughnessy (Article)

Even if the sophistication of professional managers makes it seem as though individual investors do not have an edge, they do. Without a job to worry about, individual investors can tolerate short-term underperformance on the path to long-term outperformance.

2014-10-28 Five Holiday Marketing Tips by Megan Elliott (Article)

The holiday season is an ideal time to reach out and remind people what you do in a more personal, less sales-focused way than you might at other times of the year.

2014-10-28 The Secret Words Clients Love to Hear by Beverly Flaxington (Article)

We have many clients who are really wired. They know a lot of wealthy people and many sit on boards and are trustees. Given the level of service we offer, I would expect our clients to proactively introduce us to these folks. Instead, every meeting we ask them for a referral and nothing comes of it. Does this mean we don't have the great relationships we think we have?

2014-10-28 Why Consider Brazil Now? by David Nadel of The Royce Funds

We see Brazil as a country whose investment appeal appears evident based on enduring themes, including burgeoning middle-class consumption, a young and unlevered population, business acumen in fields as diverse as agriculture and manufacturing, and more.

2014-10-28 Under the Magnifying Glass by Brian Andrew of Cleary Gull

Recent market volatility has investors trying to sort through the little things to determine what is most important to the future of asset prices. Securities markets move up and down on a daily basis based on many different factors, some more relevant than others. The markets during October have proven that little things can lead to greater volatility as investors attempt to sort out the most relevant facts from those with less meaning. Our objective, and that of our investment managers, is to sift through these details to discern what has relevance and what is noise during the trading day.

2014-10-28 Will the Ebola Scare Haunt the Stock Market? by Kristina Hooper of Allianz Global Investors

Kristina Hooper prescribes four key takeaways from the Ebola epidemic and what it means for investors.

2014-10-28 U.S. Budget: How Is Spending Trending? by Milton Ezrati of Lord Abbett

With the pivotal 2014 midterm election around the corner, here is the first of a two-part look at both sides of the U.S. budget. First up: Examining where U.S. taxpayers money actually goesand whether current spending trends are sustainable.

2014-10-28 Euro Banks: Stressed Out? by Mark Ungewitter of Charter Trust Company

Are unhealthy European banks dragging the market down? Not according to behavioral evidence. European financial stocks have generated relative strength versus broad Europe since mid July, indicating that banking woes are not the root cause of the recent correction.

2014-10-28 Moderating the Alarm on Interest Rates by Daniel Satchkov of RiXtrema

2014-10-28 Last Chance for Japan? by Stephen Roach of Project Syndicate

Notwithstanding all of the fanfare surrounding Abenomics, Japans economy remains moribund. But if Japan pays greater attention to likely shifts in the Chinese and US economies, it could be one the greatest beneficiaries of their coming rebalancing.

2014-10-28 Rising Rate Strategies by Rick Harper, Bradley Krom of WisdomTree

While the ultimate evolution of the path of U.S. interest rates remains uncertain, we believe our new strategies for risk management give investors a powerful tool kit for refining their fixed income exposure.

2014-10-28 Specialization Featuring Michelle Smith by (Article)

Advisors pursuing competitive edge may benefit from specialization, says Michelle Smith of Source Financial Advisors, whose practice focuses on divorce financial analysis.

2014-10-28 The Echo of Wirtschaftswunder by Bill O'Grady of Confluence Investment Management

Economic problems in the Eurozone continue to periodically emerge. Complicating matters significantly is German opposition to fiscal and monetary stimulus measures. We believe the experience after WWII and the Wirtschaftswunder (economic miracle) that lasted into the early 1960s has played a large role in shaping current German policy. This week we discuss German history with a focus on how German leaders shaped the economy and rebuilt the nation after the war, paying particular attention to the economic model and how the Merkel government is trying to impose that model on the entire Eurozone.

2014-10-28 Do Activist Investors Let the Game Come to Them? by William Smead of Smead Capital Management

As a recovering amateur athletethe pinnacle of my athletic career was four years of Division III college golfone concept became obvious at almost every level of athletic endeavor: let the game come to you. Rather than trying to impose your will on the opposing team or opposing player very quickly, you instead seek to discover your opponents weaknesses and use the duration of the contest to establish your superiority.

2014-10-28 The Math Of Loss by Lance Roberts of Streettalk Live

Business Insider recently published an article suggesting that if you missed the recent short covering rally then you made a classic mistake in investing.

2014-10-27 Forecasting GDP: A Look at the WSJ Economists' Collective Crystal Ball by Doug Short (Article)

One of the big economic numbers this month will be the Q3 Advance Estimate for GDP, due out on Thursday. For some the 2014 GDP context, the Q1 third estimate was negative at -2.1% followed by a strong rebound to 4.6% in the Q2 third estimate. The standard explanation for the Q1 contraction is the economic impact of an unseasonably cold winter.

What do economists see in their collective crystal ball for Q3? Let's take a look at the GDP forecasts from the latest Wall street Journal survey of economists conducted earlier this month.

2014-10-27 India: Seizing Opportunities in the New Era by Eswarie Subrahmanyam Balan of WisdomTree

Last week, the Institutional Investor Forum (IIF) held its two-day annual India Investment Forum. There was much hype going into the conference, as a slew of ministers and distinguished institutional investors were slated to speak.

2014-10-27 Fast, Furious, and Prone to Failure by John Hussman of Hussman Funds

Though we remain open to the potential for market internals to improve convincingly enough to at least defer our immediate concerns about market risk, we should also be mindful of the sequence common to the 1929, 1972, 1987, 2000 and 2007 episodes.

2014-10-27 Realized Volatility is Picking Up, but Remains Far From Extremes by Team of GaveKal Capital

After an extended period of extremely muted volatility in virtually every major asset class, volatility is finally starting to pick up, as it was always likely to do. A number of our volatility measures such as our equity, FX, bond and commodity volatility have turned a corner recently and have moved up off of in some cases generational lows.

2014-10-27 Four Investor Takeaways from the Recent Volatility Spike by Russ Koesterich of BlackRock

Last week market volatility spiked to the highest level since 2011. To some degree, this should not come as a shock; weve been in an unusually quiet period that was due to end at some point and now has.

2014-10-27 Equities Recover Some Ground and Still May Have Room to Run by Robert Doll of Nuveen Asset Management

With global deflation and growth fears fading, U.S. equities snapped their four-week losing streak last week with the S&P 500 Index gaining 4.1%. This advance marked the largest weekly gain since January 2013. Following the correction from the mid-September to mid-October, the S&P 500 has now rallied 8%, leaving it only 3% from its all-time high.

2014-10-27 Why The Fed Will End QE On Wednesday by Lance Roberts of Streettalk Live

This week we will find out the answer to whether the Federal Reserve will end its current quantitative easing program or not. Today is the last open market operation of the current program, and my bet is that it will be the last, for now. Here are my three reasons why I believe this to be the case.

2014-10-27 Fall Quarterly Commentary by John Prichard, Miles Yourman of Knightsbridge Asset Management

Born in the city of Lemberg in the Austrian-Hungarian empire (present-day Ukraine) (future-day Russia?), Ludwig von Mises would be a familiar figure to those interested in the intellectual underpinnings of economic libertarianism. He was an important contributor to the Austrian school of economic thought, which, while ultimately losing mainstream support to the Keynesians and their followers, has still remained influential in certain circles as an alternative.

2014-10-26 A Scary Story for Emerging Markets by John Mauldin of Mauldin Economics

The all-too-predictable effects of a rising dollar on emerging markets that have been propped up by hot inflows and the dollar carry trade will spread far beyond the emerging markets themselves. This is another key aspect of the not-so-coincidental consequences that we will be exploring in our series on what I feel is a sea change in the global economic environment.

2014-10-26 Plot Twistor a Different Book? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Volatility could continue but equity investors should keep the longer-term picture in mind, which we believe is positive. The U.S. economy is improving and monetary policy remains quite loose. The international picture is more concerning but diversification is important across asset classes. We currently favor emerging markets within a diversified international portfolio.

2014-10-26 Weekly Economic Commentary by Urban Carmel of The Fat Pitch

While equities have recently become volatile, the underlying fundamentals have not changed.

2014-10-25 As the Eurozone Stalls, China Cuts the Red Tape by Frank Holmes of U.S. Global Investors

France and Germanys industrial production has turned down recently. Their purchasing managers index (PMI) numbers are below the 50-mark line, indicating contraction. This trend is especially worrisome because Europe is a bigger trading partner with China than the U.S. is. So whats the solution? The EU would do well to look east, specifically to China.

2014-10-25 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Inflation is falling, but it won't go through the floor; Income inequality is affecting consumption categories; Do new mortgage lending rules strike the right balance?

2014-10-25 Swimming Naked by Robert Isbitts of Sungarden Investment Research

We have our swim trunks firmly tied around our waists, and the life preserver is tied to our hand. If nothing else, this is a time to remember that investing is a balancing act, regardless of what appears to be happening around us.

2014-10-24 What to Expect from U.S. Midterm Elections by Robert McConnaughey of Columbia Management

Next months midterm election battle for control of the U.S. Senate is going to be a dramatically close call. Republicans can gain control of the Senate if they win six new seats. Incumbent Democrats are defending 21 seats, and seven of those are in broadly red states won by Mitt Romney in 2012.

2014-10-24 Applying Value Investing Principles to Manager Selection by Jason Laurie of Altair Advisers

Using short-term underperformance as a value opportunity can work in selecting money managers. The qualitative portion of the manager due diligence process is still the key to success. All great managers experience periods of underperformance; patience with them is rewarded. There is little basis in manager performance data for persistence in manager returns. Manager performance cycles either outperformance or underperformance often last 3-5 years. Short-term periods of underperformance by top managers may present an opportunity to allocate to managers at attractive entry point

2014-10-24 Short-Term Optimism, Longer-Term Caution by Scott Minerd of Guggenheim Partners

U.S. stocks will likely move higher as pension fund managers go bargain hunting in an effort to put seasonal cash inflows to work.

2014-10-24 Risk Aversion on the Rise Gold Back in Vogue by Ade Odunsi of AdvisorShares

In this weeks commentary we present a simple methodology for measuring the amount of risk aversion in gold markets. This measure of risk aversion (which we define below) compares the variability of observed gold prices versus the variability that can be implied from gold option prices.

2014-10-24 Investing by Duration by Heather Rupp of AdvisorShares

It was hard to ignore the call in the fixed income space for short duration investing over the last couple years. Duration is a measure of interest rate sensitivity (the percentage change in the price of a bond for a 100 basis point move in rates), so the lower the duration the theoretically less sensitive those bonds are to interest rate movements.

2014-10-24 Inflating the Big Mac One Calorie At A Time by James Cornehlsen of Dunn Warren Investment Advisors

Continuing our research into using the Big Mac as a gauge of inflation, we build on past posts but use our own research to draw conclusions. In previous articles, we have relied solely on The Economists calculation of the Big Mac price.

2014-10-24 Steady as She Goes by John Osterweis, Matt Berler of Osterweis Capital Management

For some time now we have been making the case for a long-term bull market in U.S. equities. This has rested on the prediction of a gradual economic recovery devoid of inflationary pressures, played out against a very accommodative monetary backdrop. So far, this is exactly what has occurred. But as we all know, trees dont grow to heaven and nothing lasts forever. Therefore the relevant questions we ask ourselves every day are: (1) what could go wrong and (2) when should we start to worry? We shall devote this quarters Outlook to the things we worry about.

2014-10-24 5 Things To Ponder: To QE Or Not To QE by Lance Roberts of Streettalk Live

Over the last few weeks, the markets have seen wild vacillations as stocks plunged and then surged on a massive short-squeeze in the most beaten up sectors of energy and small-mid capitalization companies. While "Ebola" fears filled mainstream headlines the other driver behind the sell-off, and then marked recovery, was a variety of rhetoric surrounding the last vestiges of the current quantitative easing program by the Fed. As I have shown many times in the past, there is a high degree of correlation between the Fed's liquidity programs and the advance in the markets.

2014-10-24 Japanese Style Deflation Coming? Fed Falling Behind the Curve? by Mike "Mish" Shedlock of Sitka Pacific

There's some interesting discussion points in the UK-based Absolute Return Partners October 2014 Letter, by Niels C. Jensen, most of which I agree with, others not.

2014-10-24 The Positive Impact of Falling Oil Prices by Nick Kalivas of Invesco Blog

Crude oil prices have dropped sharply over the last few months thanks to abundant global production and signs of slowing global economic growth. Lower oil prices could inject spending power into the economy as consumers eventually pay less for gasoline and open their wallets in other areas. This would provide a positive shock and potentially bolster the performance of consumer discretionary shares.

2014-10-23 When Will Rates Potentially Rise? by Team of Osterweis Capital Management

When 2014 started, some Wall Street strategists predicted a continuing rise in interest rates as U.S. economic growth accelerated and the Federal Reserve (the Fed) reduced its monthly stimulus. Instead, it has been a one-way street in government bond markets as they continued to deliver low yields at higher prices. In August, the yield on the benchmark U.S. 10-year Note fell to 2.3%, back down to June 2013 levels.

2014-10-23 China: Decelerating but Still Healthy by Andy Rothman of Matthews Asia

GDP growth will be just above 7% this year, and slightly slower next year. Despite the negative media headlines, there are no signs of impending doom and Andy Rothman, Matthews Asia Investment Strategist, expects the property market to stabilize in the coming quarters. Strong growth in income and retail sales means China remains the worlds best consumption story.

2014-10-23 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company

Since mid-September, several items have changedsome economic, some market-related, some psychological.

2014-10-23 Is This the Beginning of a New Bear Market? Important Signs to Watch by Chris Puplava of PFS Group

How the markets behave in the coming weeks will go a long way to help determine if the September-October correction was the start of a new bear market or just a normal correction in a bull market. Chris Puplava provides a detailed outlook

2014-10-23 Quarterly Review and Outlook by Team of Hoisington Investment Management

The U.S. economy continues to lose momentum despite the Federal Reserves use of conventional techniques and numerous experimental measures to spur growth. In the first half of the year, real GDP grew at only a 1.2% annual rate while real per capita GDP increased by a minimal 0.3% annual rate. Such increases are insufficient to raise the standard of living, which, as measured by real median household income, stands at the same level as it did seventeen years ago

2014-10-23 How Consensus Thinking Works Against Investors by Bob Andres of Andres Capital Management

Over the past several years we have used this newsletter to voice our concerns regarding the macro-economic landscape, while attempting to provide practical solutions for investors. Since our venture into financial commentary, we have questioned the veracity of consensus opinion and how it tends to be wrong, especially in regards to interest rates.

2014-10-23 Everything Is Not As It Seems by Sean Hanlon of Hanlon Investment Management

As of September 25, 2014 the NASDAQ Composite index is up 6.95% year-to-date, despite the recent downturn in the market. The darling tech stocks continue to come up with new and innovative ideas for products and services to drive their bottom lines. The NASDAQ is only down -2.86% from the high it made on September 2, 2014. One could conclude that the NASDAQ is indeed solid and that this is just another passing correction before it pushes on to higher levels.

2014-10-23 No More Black Mondays by Jeffrey Saut of Raymond James

In a true demonstration of impeccable and apropos timing given the recent volatility we have experienced, yesterday marked the 27th anniversary of one of the stock markets most infamous and chronicled events. Black Monday, October 19, 1987 was one of those multiple standard deviation occurrences that statisticians will tell you are not supposed to ever really happen, but as is the case more frequently than most realize, it of course did happen, and its impact is still being felt today even as there are fewer and fewer investors around that actually had to suffer through it.

2014-10-23 Risk and Uncertainty, Confidence and Fear by Scott Brown of Raymond James

In recent weeks, the financial markets appear to have been reacting less to weaker expectations of global growth and more to the increased downside risks that is, to the fear that things could get a lot worse. The downside risks to Europe are considerable, but America is much less dependent on exports than most other countries and the prospects for moderately strong growth into 2015 remain promising.

2014-10-23 Equities: Is the Bull Market Under a Threat? by Keith Wade of Schroders Investment Management

Equity markets have experienced a setback recently and this has led many strategists to question the longer term case for the asset class. However, we remain positive on shares and believe that equities can still generate an attractive premium for investors.

2014-10-23 3 Things Worth Thinking About: Inflation, the Current Rally and Faith in the Fed by Lance Roberts of Streettalk Live

What is quickly being realized on a global basis is that injecting the system with liquidity that flows into asset prices, does not create organic economic demand. Both Japan and the Eurozone's interventions have failed to spark inflationary pressures as the massive debt burden's carried by these countries continues to sap the ability to stimulate real growth.

2014-10-22 The Eighth Default of Argentina by Kaisa Stucke, Bill O'Grady of Confluence Investment Management

Very few countries have seen as spectacular of a decline in its economic standing over the past 100 years as Argentina has. Argentina has been in the international headlines recently due to its sovereign debt default, the eighth default in the history of the country. This week we will look at Argentina, its long history of economic booms and busts, its political background, and its extensive chronicle of sovereign debt defaults. As always, we will conclude with market ramifications.

2014-10-22 Oil Hits the Skids by Burt White of LPL Financial

We believe the oil sell-off is overdone and expect the commodity to find a floor in the low $80s. We expect firming global growth to increase the markets confidence in global oil demand despite weakness in Europe. Energy service stocks are particularly oversold and may be attractive as the services-intensive U.S. energy renaissance continues.

2014-10-22 Mr. Toads Wild Ride by Alan Hartley of Black Cypress Capital Management

Every time the stock market falls 3% or 4%, investors start to act like were staring at an oncoming locomotive. Though, each train has been the sort from Mr. Toads Wild Ridenot really a train at all, just bright lights and sounds meant to scare us.

2014-10-22 Retirement: How To Avoid Outliving Your Savings by Gary Halbert of Halbert Wealth Management

With over 10,000 Baby Boomers retiring every day, a pattern that will continue for the next 20 years, retirement savings continues to be one of the most important issues of our day. With 76 million Americans born between 1946 and 1964 the Baby Boom Generation saving enough for retirement is critically important.

2014-10-22 Whats Next for the Indian Rupee? by Bradley Krom of WisdomTree

Even before the election results were fully counted in May, Indian currency and equity markets were reacting. After touching all-time lows last year, the rupee surged on the optimism that the reform-minded Modi would push through an agenda to improve Indian economic competitiveness.

2014-10-22 The US Mortgage Application Market Finally Wakes Up by Team of GaveKal Capital

All summer long we talked about how mortgage applications were down and couldn't get off the mat. That looks to finally be changing, at least from a refinancing point of view over the past couple of weeks. In the last two weeks the mortgage application index has increased from the 350 to 413 and has broke out of the range it has been in all year.

2014-10-22 Despite Volatility, This Bull Is Likely to Charge Higher by John Calamos, Gary Black of Calamos Investments

As the fourth quarter begins, the market has found itself engulfed in anxiety. Volatility has surged in the equity markets while the 10-year Treasury yield has dropped to 2%-leading some to question whether this bull market is breathing its last breath. We believe: * Global GDP growth will likely be in the 2.0%-3.0% range. * The U.S. is in the 5th or 6th inning of recovery, with slow but improving growth. * Despite the surge in volatility, this bull market has more room to run. * A balance of secular and cyclical growth companies presents the most attractive portfolio for this mid-cycle phase.

2014-10-22 Stay Out of the Echo Chamber Focusing on the Market Fundamentals by Pamela Rosenau of HighTower Advisors

In the middle of the recent stock market correction, I read an article emblazoned on the front page of the New York Times reporting on the market volatility and fear. The introductory line read, The party is over. This was the classic contrarian sign that we were forming an interim bottom in the correction.

2014-10-22 Chained CPI Versus the Standard CPI: Breaking Down the Numbers by Doug Short (Article)

The Consumer Price Index for Urban Consumers is the most familiar gauge of inflation in the US. The data for the non-seasonally adjusted series stretches back a century to January 1913. But in February of last year the big news was relative newcomer to the inflation metrics of the Bureau of Labor Statistics (BLS), the Chained CPI for Urban Consumers.

The reason the Chained CPI was a hot topic in the news in last year was that President Obama had proposed it in his 2014 budget as the method for determining cost of living adjustments for Social Security.

2014-10-22 What If Chained CPI Had Been Used to Calculate COLAs Since 2002? by Doug Short (Article)

Last year, President Obama's 2014 proposed budget recommended that, starting in 2015, COLAs should be calculated with the Chained Consumer Price Index for All Urban Consumers (Chained CPI). In this year's proposed budget for 2015, the President abandoned the proposed shift to the Chained CPI for Social Security adjustments.

Let's look at what the effect would have been over the years for a typical Social Security recipient if the Chained CP had been used since its inception.

2014-10-21 The Price We Will Pay for Cheap Oil by Richard Vodra (Article)

Suddenly in June, oil prices started dropping, reaching levels unseen since 2010. What is going on? Why does the price of oil matter to financial advisors? What might these fluctuations mean to the price and supply of oil for the rest of the decade? Isn't oil just another commodity?

2014-10-21 How to Compete with Online Advice: The Historical Lessons by Dan Richards (Article)

Online start-ups offering low-cost investment advice have received lots of attention, not to mention over $200 million dollars in venture capital. What lessons does history offer on the likely impact of online advice? And based on what's happened in the past, how can advisors respond to this new threat?

2014-10-21 Shift Your Focus to Gain AUM by Daniel Solin (Article)

Based on merit alone, I would entrust my own portfolio to almost every RIA that I have met. But merit is not the governing factor in most decisions.

2014-10-21 Q3 Venerated Voices by Various (Article)

We have announced our Venerated Voices awards for commentaries published in the third quarter of 2014. Rankings were issued in three categories: The Top 25 Venerated Voices by Firm, The Top 25 Venerated Voices by Author and The Top 10 Venerated Voices by Commentary.

2014-10-21 The Wrong Question to Ask About Marketing by Mandy Fisher (Article)

When confronted with a marketing decision, the first thing most advisors ask how much it will cost. But that's the wrong question.

2014-10-21 Getting Your Boss to Understand You by Beverly Flaxington (Article)

My boss does not understand me. Every time he asks me to do something, he criticizes my work. Everything I submit is "wrong" and needs to be redone. I'm pulling my hair out (and I didn't have much to start with). How do I get him to see what I am doing in a positive light?

2014-10-21 Help is on the Horizon to Ease Student Debt by Sponsored Content from Legg Mason (Article)

To preempt the college funding crisis that lies ahead, we must ensure that future generations avoid excessive debt. With the current path unsustainable, experts believe the partnership between 529s, colleges and government must evolve. Get a preview of tomorrow's college conversation and advisors' role in the holistic solution.

2014-10-21 Loomis Sayles Core Plus Bond Fund: Navigating Dynamic Markets with Tactical Flexibility by Sponsored Content from Loomis Sayles (Article)

The global economic cycle is a perpetual force influencing interest rates, credit availability and capital markets. For core plus managers who seek to generate total return by balancing liquidity and risk, these undulations pose a clear challenge.

2014-10-21 The Economy: October Viewpoint by Robert Cron of Bronfman E.L. Rothschild

The U.S. economy continues to move forward in its slow but steady recovery. Despite the Federal Reserve ending their bond buying program in October, demand for U.S. fixed income continues to be robust. The recent downward movement in the stock markets has some investors talking correction once again, and growth concerns overseas finally seem to affecting the performance of the domestic markets. We believe there is still more room for improvement for foreign economies, while the U.S. seems to be a more stable environment.

2014-10-21 The Skinny on Fatter Tails for Fed Policy by Kristina Hooper of Allianz Global Investors

Kristina Hooper comments on escalating fears that a slowdown in global growth could hamstring the US recovery and what that means for monetary-policy outcomes in the United States.

2014-10-21 Turkey's Position on ISIL Misunderstood by John Browne of Euro Pacific Capital

As territory in the Middle East falls under control of the brutal fanatics of ISIL, many Americans may be wondering how this could happen in the backyard of major U.S. allies. In particular, frustration with Turkey's reluctance to move against ISIL, even as it massacres civilians and creates instability on the Turkish border, is growing rapidly. Turkey's political calculation with respect to the crisis reveals just how complex and intractable the crisis may become.

2014-10-21 A Life-Cycle or Lifestyle Fund? A Critical Investment Decision by Milton Ezrati of Lord Abbett

Just because two people are the same age does not mean that they have the same investment needs or risk tolerances.

2014-10-21 Opportunities Amid Divergence by Michael Gomez of PIMCO

As in developed markets, the trends of increasing growth and policy dispersion will be borne out in emerging markets over the next 12 months. Brazil has some of the highest interest rates in the world, which presents an opportunity for investors, and we expect the next four years will be marked by a better mix of fiscal and monetary policy. Because our outlook for China has moderated somewhat, we are focusing attention on trade and financial linkages and how the ripple effects of a slower China might unfold.

2014-10-21 Can You Panic and Still be an Investor? by Jerry Wagner of Flexible Plan Investments

Quite a week we just had, regardless of asset class. By Wednesday the Dow had fallen 688 points by mid-day, thanks to a 480-point morning decline. The problem was a lack of liquiditya buyers strike (no buyers in the market)as we used to call it. In response, stocks fell, as did commodities (with the exception of gold) and yields plunged on bonds.

2014-10-21 October has Been a Tough Month for Stock Picking by Team of GaveKal Capital

The percent of stocks with positive performance for the month of October through last Friday stands at a paltry 15%. Granted, as of last Friday there were ten trading days left in the month, but 15% would the lowest reading since May of 2012 and September of 2011 before that.

2014-10-21 Blurring the Lines Between Emerging-, Frontier- and Developed-Market Stocks by Mark Mobius of Franklin Templeton Investments

There has been some convergence in terms of how one might classify emerging-, frontier- or developed-market companiesand how they might fit into investors portfolios. Recently, we have noted an increase in liquidity and transparency of many frontier-market stocks (the smaller and lesser-developed subset of emerging markets).

2014-10-21 Rising Rates Implementation Plan: Core Plus & Risk Management by Rick Harper, Bradley Krom of WisdomTree

While our view on rising rates has yet to meaningfully materialize this year, our underlying thesis has not changed. In our view, it may be time for investors to think about how a bond portfolio may perform as a result of changes in Federal Reserve (Fed) policy.

2014-10-21 The Flat Debt Society by John Mauldin of Mauldin Economics

Since at least the beginning of 2006, the most asked question I get after a speech is Do you think we will have inflation or deflation? In an attempt at humor, my answer has been Yes.

2014-10-21 Attractive Stocks in a Bifurcated Market by William Smead of Smead Capital Management

As value stock picking managers, we assume we will be operating in a bifurcated equity environment. We think the bifurcation will be between sectors of the stock market which appear over-capitalized due to rear-view mirror success and those which look undervalued when considering the present value of their future income stream. The combination of numerous forces, both positive and negative, will most likely create this bifurcation.

2014-10-21 Anticipating the 2015 Cost of Living Adjustment for Social Security by Doug Short (Article)

Summary: Tomorrow the Social Security Administration will announce the Cost of Living Adjustment (COLA) for 2015. A forecast based on data so far is a COLA of 1.7%. But the Q3 decline in energy prices strengthens the odds of a lower 1.6% adjustment.

2014-10-21 The Tool that Will Transform Firmwide Financial Planning by Bob Veres (Article)

Alex Murguia, founder and CEO of InStream Solutions, may be the most creative visionary in today's advisor software ecosystem. And like all people who think outside the box, sometimes he discovers that his best ideas have far better uses than he intended.

2014-10-21 Advising Clients about When to Retire by Joe Tomlinson (Article)

Clients are often surprised to learn that delaying retirement can increase retirement income by a lot. Although each case will be different, I'll present an example to provide some general insights.

2014-10-20 Current Turnaround Candidates by Bill Hench and Dave Gruber (Article)

Portfolio Manager Bill Hench gives Principal Dave Gruber current examples of his portfolios' turnaround themes: emerging growth companies with interrupted earnings patterns, companies with unrecognized asset values, and undervalued growth companies.

2014-10-20 A New Look at the Total Return Roller Coaster by Doug Short (Article)

Note from dshort: I received a recent email on historical total returns that prompted an update to my Roller Coaster Return series. I've updated the charts below based on monthly data through the September close.

Imagine that five years ago you invested $10,000 in the S&P 500. How much would it be worth today, with dividends reinvested but adjusted for inflation?

2014-10-20 On the Tendency of Large Market Losses to Occur in Succession by John Hussman of Hussman Funds

We may wish to believe that a 25-30% market plunge has zero probability since we know that the probability of a one-day loss of several percent is quite low, making a whole series of them seemingly impossible. But that view overlooks the tendency of large losses to occur in succession. It also overlooks the tendency for monetary easing to support stocks only when low- or zero-interest risk-free assets are considered inferior holdings in comparison to risky ones.

2014-10-20 Japan: Small Change Clouds Big Picture by Mark Jason of Invesco Blog

We continue to believe that achieving real economic growth in Japan requires changes that are hard to come by. On a recent trip to Japan, it became clear to me that this next stage of Abenomics shorthand for Prime Minister Shinzo Abes three-arrow economic revitalization program of monetary easing, targeted financial support and structural reforms calls for corporate governance reform to take the spotlight as a core part of the important third arrow, particularly as regulatory reforms have made slow progress thus far.

2014-10-20 Equity Losses Continue, but This Correction May Be Ending by Robert Doll of Nuveen Asset Management

Markets endured a sharp pullback and higher volatility, but technical factors suggest we may be nearing the end of the current correction. Long-term, we believe fundamentals remain sound, the U.S. economy should continue to grow and equities should be able to grind higher.

2014-10-20 Stock Valuations Remain Near Record High Including in Europe and EM by Team of GaveKal Capital

Even as stock prices have corrected in recent weeks with only 36% of stocks having positive performance over the last 200 days and the average stock 19% from its one year high, we are reminded that stock valuations are still stretched pretty much everywhere.

2014-10-20 A Treasury Market Disconnect by Roger Bayston of Franklin Templeton Investments

As the US economy continues to show signs of strength and the US Federal Reserve (Fed) continues to wind down its quantitative easing (QE) program, one would think the US Treasury markets would start reflecting a potential rise in inflation, and the eventuality of Fed monetary policy tightening. However, there has been a bit of disconnect in terms of behavior on the long end of the Treasury yield curve.

2014-10-20 Five Ways to Keep Out of the Bond Liquidity Trap by Douglas Peebles of AllianceBernstein

Bond investors are used to managing interest-rate risk and credit risk. But the financial crisis should have taught us that there are times when liquidity risk can be just as important to manage. Now is one of those times.

2014-10-20 Five Things You Should Know About U.S. Small-Caps by Francis Gannon of The Royce Funds

Co-Chief Investment Officer Francis Gannon offers five statistics we think every investor should know about U.S. small-caps in the current volatile investment environment.

2014-10-19 Where Are We? A Psychological View by Robert Isbitts of Sungarden Investment Research

When markets get temporarily unruly as they have recently, it tends to drive folks like us to go back and prove to ourselves once again that each and every part of our existing portfolios (the stocks and the hedge positions we own) is as valid to us as it was when we bought it. And, with many stocks on our watch list getting closer to being viable additions to the mix as their prices drop, we are essentially scouring our investable universe to see if we can either improve our upside potential, strengthen our defenses, or both. It is a rigorous process, always.

2014-10-19 Weekly Economic Commentary by Team of Northern Trust

The markets correction has many scratching their heads. Russias economy is feeling a pinch but not real pain. Long-term remedies will be needed to secure U.S. budget health.

2014-10-19 What the Strong Dollar Does to Yellow and Black Gold and Why We're Seeing Green by Frank Holmes of U.S. Global Investors

The United States is doing better than it has in years. Jobs growth is up, unemployment is down, our manufacturing sector carries the rest of the world on its shoulders like a wounded soldier and the World Economic Forum named the U.S. the third-most competitive nation, our highest ranking since before the recession.

2014-10-19 Weighing the Week Ahead: Is the Correction Over? by Jeff Miller of New Arc Investments

Was that the bottom? Nearly everyone is trying to time the market, so the financial media will focus on remaining risk versus signals of a bottom.

2014-10-19 Weekly Market Summary by Urban Carmel of The Fat Pitch

After 27 months, SPX experienced its first 10% correction this week. As we have detailed many times, this was an exceptionally long and uncorrected rise. Since its last 10% correction in mid 2012, SPX has risen an exceptional 59%.

2014-10-17 Disinflation Infatuation by Anthony Valeri of LPL Financial

Inflation expectations have fallen sharply in recent weeks, driven by European disinflation, lower energy prices, and overall growth concerns. The persistence of low inflation expectations may intensify the lower for longer theme via lower growth expectations and delays to potential Federal Reserve (Fed) interest rate hikes.

2014-10-17 A Moody Market by Doug MacKay, Bill Hoover of Broadleaf Partners

For those that may not have noticed, stock market volatility has been on the rise in October, with more up and down 1-2% days and powerful intraday moves than we've seen since the Great Recession. Weak overseas economies, fears over what rapid declines in energy prices could mean, and Ebola are just a few of the factors that have been used to explain the disappointing action.

2014-10-17 Being Intelligent About Smart Beta by Chris Richey of Neosho Capital

Given the history of miracle cures, magic potions, sure things, and cant misses, you will forgive our skepticism as Smart Beta entered the financial lexicon over the past 3 years. Things promising to be smart often look very dumb in retrospect. But we were intrigued, if only because humility and competition demand an open mind.

2014-10-17 Seasonal Factors Ready to Turn Positive by Scott Minerd of Guggenheim Partners

After a volatile week in markets, U.S. equities are now oversold and investors should be alert for seasonal factors that should soon turn positive.

2014-10-17 The Inequality Trifecta by Mohamed El-Erian of Project Syndicate

Perhaps the most striking disconnect at the annual IMF/World Bank meetings was the disparity between participants’ interest in discussions of inequality and the ongoing lack of a formal action plan for governments to address it. This represents a profound failure of policy imagination – one that must urgently be addressed.

2014-10-17 To Infinity and Beyond! by Colin Moore of Columbia Management

To infinity and beyond! is the catchphrase of Buzz Lightyear, the popular character from Disneys Toy Story franchise. The phrase is both whimsical and paradoxical. The character of Buzz was inspired by Apollo 11 astronaut Buzz Aldrin; but the phrase may be a tribute to Stanley Kubricks 2001: A Space Odyssey, in which the concept of Jupiter and beyond the infinite was introduced.

2014-10-17 Pullback Perspective by Burt White of LPL Financial

We see the recent increase in volatility as normal within the context of an ongoing bull market. We do not believe the age of the bull market, at more than 5.5 years old, means it should end. We maintain our positive outlook for stocks for the remainder of 2014 and into 2015.

2014-10-17 5 Things To Ponder: "Buy" or "Run" by Lance Roberts of STA Wealth Management

This past week investors to a blow from a sharp selloff in the financial markets. I have spilled quite a bit of ink in recent months discussing the probabilities of such as corrective event as the Federal Reserves current liquidity operation came to a conclusion this month.

2014-10-17 Special Report: Volatility Update by Richard Bernstein of Richard Bernstein Advisors

Volatility can destroy the best of financial plans. Simply doing nothing can be a fine strategy in the face of short-term volatility, but the tension associated with market downdrafts makes both institutional and individual investors feel that doing nothing is not an alternative. However, decisions made under duress are typically decisions that should not be made.

2014-10-17 Why High Yield, Why Now by Tim Gramatovich, Heather Rupp of AdvisorShares

Here are some of the reasons we believe that the high yield bond market looks attractive at current levels.

2014-10-16 Global Worries (And Some Benefits) by Scott Brown of Raymond James

In the latest update of its World Economic Outlook, the IMF revised lower its expectations of global growth in 2014 and 2015. None of that should have surprised anyone. At this point, the IMF expects that European GDP will be relatively weak in 2014 (+0.8% 4Q14/4Q13) and should improve in 2015 (+1.6% 4Q15/4Q14). However, risks are weighted predominately to the downside. Weaker European growth and a stronger dollar will have a significant impact on many U.S. firms, but may have some benefits for the economy as a whole.

2014-10-16 The Right Question by Jeffrey Saut of Raymond James

In this business it has been said, Sometimes knowing the right question is more important than actually knowing the answer. Over the years I have found that old Wall Street axiom to serve me well. One example would be reading the footnotes in a companys annual report.

2014-10-16 The Boutique Advantage by Team of Ridgeworth

A recent survey highlights advisors thoughts and concerns about these specialized investment managers.

2014-10-16 Europe: Draghi's Deflation Desperation by Milton Ezrati of Lord Abbett

The specter of falling prices in the eurozone is making the ECB chiefs job even harder.

2014-10-16 Governments Need Inflation, Economies Don't by Peter Schiff of Euro Pacific Capital

In an article in the UK's Telegraph on October 10, veteran economic correspondent Ambrose Evans-Pritchard laid bare the essential truth of the nearly universal current embrace of inflation as an economic panacea. While politicians, CEOs and economists talk about demand stimulus and the avoidance of a deflationary trap, Evans-Pritchard reminds us that inflation is all, and always, about debt management.

2014-10-16 October is a Scary Month by Brian Andrew of Cleary Gull

The current environment for stock investors can be trying. Global cross currents regarding economic growth, employment, government policy, and corporate earnings have created the first test of investors mettle in almost two years. We have an opportunity to use current market events to review our investment plan and check our emotional temperature.

2014-10-16 Global Carry a.k.a. Risk Parity by Alexander Giryavets of Dynamika Capital L.L.C.

It is customary to think of Risk Parity Asset Allocation and Carry Trading Strategy as two different things. We explain that the Risk Parity after the Global Financial Crisis is nothing else but a hugely successful Global Carry Trade funded in Japanese Yen, Dollar and Euro. The performance of this trade is fantastic, the allocation is huge (100s of blns of $) and the risk of crash that will precipitate the next financial crisis is growing day by day. But for now the music is still playing.

2014-10-16 The Case for High Multiples by David Kleinberg of Universal Orbit

High P/E multiple companies, along with their near cousins N/A and NMF, display the characteristics of mid- to late-cycle reporting periodsincreasing trends in cash flow, from negative to positive. The case for high multiples is initially supported by lofty valuations and low interest rates amid robust earnings in this perhaps peak cycle. Irrespective of the cycles and subcycles driving profitability, we look forward to more variable less certain comparables among changing industry-specific capital market dynamics.

2014-10-16 Optimizing a Portfolio Allocation to Gold by Ade Odunsi of AdvisorShares

Gold continues to be an attractive asset class that many investors wish to hold in their portfolios primarily for its diversification benefits and defensive characteristics during periods of high risk aversion in global markets. And notably many investors gain their gold exposure via exchange traded products given the ease of access, liquidity and the transparency they offer, particularly to retail investors who historically faced numerous barriers to holding gold in their portfolios.

2014-10-16 Global Evolution a Game Changer for Real Estate by Patrick Brophy of Janus Capital Group

As investors consider rising rates and the impact on yield-based assets, it is time to address a couple of common misperceptions about real estate. Patrick Brophy, Portfolio Manager of the Janus Global Real Estate Fund, explains why rising rates are not directionally bad for real estate equities. He also explains why real estate can be more than just a source of income for portfolios.

2014-10-16 Measuring Up by Gary Stroik of WBI Investments

Are you a better than average driver? According to a number of survey results, a lot of drivers think they are. A Survey by PublicMind at Fairleigh Dickinson University found that 68% of the drivers polled considered themselves above average, 30% considered themselves average, and just 1% considered themselves to be below average. (1% were unsure or refused to answer.)

2014-10-16 Risk Aversion and Dollar Strength by Rick Harper of WisdomTree

Since the dollar is the primary reserve currency of the world, investors typically seek exposure to the dollar via short-term assets when market sentiment begins to shift. As we explain, the U.S. dollar can serve as an effective hedge to market uncertainty when volatility unexpectedly spikes.

2014-10-16 CEF Market Update Featuring Mike Taggart by (Article)

The availability of double-digit discounts and the potential for increased volatility may create opportunities for CEF investors, says Mike Taggart of Nuveen Investments.

2014-10-15 The Sell-Off Continues, But an Opportunity Appears by Russ Koesterich of BlackRock

In recent weeks, investors have been contending with two trends: anxiety over a change in Fed policy and evidence of a slowdown in the global economy. While global growth is likely to remain below historic norms, it is not collapsing. This suggests that investors should be positioned for a slow growth environment, not another recession. This, in turn, implies taking some selective risk in asset classes that have become less expensive as a result of the sell-off. One example of an asset that warrants another look: U.S. high yield bonds.

2014-10-15 What Are We Doing to Our Young Investors? by Rob Arnott, Lillian Wu of Research Affiliates

In the latest piece from Research Affiliates, Rob Arnott, chairman and CEO, and Lillian Wu, researcher, look at the growing use of target date funds by young workers, and how their defined contribution (DC) portfolios are therefore increasingly concentrated in stocks. However, young workers are more likely to cash out their DC assets to meet living expenses during a recession or other hardship, and equity volatility could leave them in a bind. Arnott and Wu offer a potential solution: less risky starter portfolios.

2014-10-15 How Over-Regulation Hurts Us - Some Eye-Popping Numbers by Gary Halbert of Halbert Wealth Management

The study entitled Federal Regulation and Aggregate Economic Growth was published by the Journal of Economic Growth. Among other things, the Journal conducts research on how over-regulation hurts the economy. The Journal calculates that over-regulation has shaved at least 2% off of annual economic growth since 1949.

2014-10-15 Disruptive Innovation: The New Normal by Team of Manning & Napier

The current economic and market environment is not one in which a rising tide of economic growth will lift all ships; actually, its quite the opposite. As businesses compete, the winners will largely succeed at the expense of the losers. Consider recent examples such as Nokia and BlackBerry; both companies once widely recognized as dominating their respective markets, only to be disrupted by innovative competitors.

2014-10-15 Unlocking Aleres Potential by Igor Golalic of Diamond Hill Capital Management, Inc.

Health care has historically been a good business, especially in the United States. Investors like to invest in good businesses and will usually pay a premium for those that generate stable, predictable, and excess returns or any combination thereof. There are certain characteristics that create an environment within which such businesses can prosper higher barriers to entry, sticky customer base, secular growth prospects, low capital intensity, and lack of credible substitutes.

2014-10-15 Is Smart Beta Smart Enough? by Richard Bernstein of Richard Bernstein Advisors

As smart as smart beta might be, it is not smart enough to answer the most important question in beta management. The key to successful beta management, regardless of whether the beta is smart or dumb, depends primarily on the choice and timing of beta. A strategy that focuses on smart beta without consideration for full beta management seems very likely to underperform.

2014-10-15 Who Will Blink First? by Portfolio Management Team of SMC Fixed Income Management

While tax-exempt yields did follow Treasuries higher during September, the snap-back has been fast and significant; yields have recently established new twelve-month lows. Meanwhile, investors appear to be repositioning from equity and other asset classes into fixed income. The move to bonds includes municipal securities, as evidenced by strong flows into tax-exempt funds, which is forcing cash-laden portfolio managers to buy at the highest prices of the year.

2014-10-15 Dilma or No Dilma? by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

During the first round of Brazilian presidential elections on October 5, the incumbent Dilma Rousseff received 42% of the votes while Aecio Neves received 34%. Since neither candidate received more than 50% of the vote, the second round of runoff elections will be held on October 26. This week, we will look at the Brazilian presidential elections along with the countrys current political and economic environment. We will briefly describe the recent political history of the country and look at the specifics of Brazils economic development. As usual, we will conclude with market ra

2014-10-14 APViewpoint TODAY: The Bond Market: How to Play it in 2014 and Beyond by Doug Short (Article)

Our next APViewpoint Event gives you the opportunity to gain investment insights and engage in Q&A with nationally recognized investment manager Jeffrey Gundlach.

Mark your calendar: TODAY, October 14th at 4:15pm EST. To register before the event...

2014-10-14 Millennials in Motion: Changing Travel Habits of Young Americans by Doug Short (Article)

Regular visitors to this website are aware of my keen interest in long-term trends in Vehicle Miles Traveled, Gasoline Prices and Gasoline Volume Sales.

Today the U.S. PIRG (U.S. Public Interest Research Group) has released a fascinating study on the travel habits of Millennials (those born between 1983 and 2000) and the profound implications for transportation policy. The full report is available for download in PDF format at the U.S. PIRG website.

2014-10-14 What Is Flexible Indexing? by Shundrawn Thomas (Article)

Shundrawn Thomas discusses how FlexShares' Flexible Indexing approach produces nontraditional indexes that target fundamental investor goals.

2014-10-14 Bill Sharpe on Retirement Planning by Robert Huebscher (Article)

Bill Sharpe discusses topics at the forefront of financial-planning research: The role of annuities in a retirement portfolio, the proper glidepath for target-date funds, if investors should anticipate mean reversion in market returns and whether ESG- and SRI-oriented portfolios make sense.

2014-10-14 High Quality Mid Caps Enjoy Performance Advantage by Sponsored Content from ClearBridge Investments (Article)

Since 1965, high-quality midcap stocks have outperformed their low-quality peers by a meaningful margin-a premium that has been most pronounced during periods of market transition. As we approach an inflection point in the current market and economy, investors should consider high-quality mid-cap stocks, which appear poised to thrive.

2014-10-14 The Ultimate Income Portfolio: 7.1% Yield with Low Risk by Geoff Considine (Article)

I analyze the performance of last year's Ultimate Income Portfolio and generate the one for 2014-15. The result is a portfolio that yields 7.1% with a risk level equivalent to a 70/30 stock/bond index fund. I also explore some of the lessons learned from four years of tracking and revising the portfolios.

2014-10-14 The Five Seconds When You Can Lose a Prospect by Dan Richards (Article)

When you meet with prospects, how long does it take for them to form the initial opinion of you that will shape their lasting perceptions? The scary answer: Five seconds or less. To maximize the chances of a positive outcome from an initial meeting, advisors need to get a number of things right.

2014-10-14 Dealing With a Really Difficult Prospect by Daniel Solin (Article)

We have all had experience trying to convert difficult (sometimes really difficult) prospects into clients. In a recent article, I discussed some of the issues I have confronted when dealing with narcissistic advisors. But clients, or prospective clients, can display narcissistic behavior too.

2014-10-14 How to Promote Your Case Studies by Elizabeth Snyder (Article)

If you don't promote your case studies effectively, they won't help you achieve your marketing goals.

2014-10-14 Where is an Advisor's Time Best Spent? by Beverly Flaxington (Article)

Is it more important for an advisor who leads a firm to spend time with clients or with staff?

2014-10-14 Sea Change by John Mauldin of Mauldin Economics

The final chapter and conclusion pretty much end as you would expect: the demise of monetary policys ability to soothe the soul of the markets and the return of volatility. We hopefully get a full-fledged restructuring of the sovereign debt markets. The Fed and sister central banks will try the same tired tools they have been using. Except they have already been to the zero rate boundary and have wasted the opportunity they had to increase rates so that they could lower them later. Another round of quantitative easing?

2014-10-14 The Eurozone Plots Its Long Road to Recovery by David Zahn of Franklin Templeton Investments

Growth in much of Europe is slow - some observers even say the economy is moving sideways. Lately, the eurozone seems to have more in common with Japan, whose economy has been idling for years, than it does with the UK or the United States.

2014-10-14 Assessing the Economic Impact of Hong Kongs Occupy Central Movement by Paul Chan of Invesco Blog

The Occupy Central (OC) movement was officially launched on Sept. 28, starting with members from the Occupy Central with Love and Peace (OCLP), the HK Federation of Students and Scholarism groups staging a sit-in in Central and Admiralty that blocked traffic in key commercial and business districts in Hong Kong.

2014-10-14 Finding Value in the Municipal Market Today by Bob Andres of Andres Capital Management

With the Feds recent remarks regarding their near term plan or lack thereof for short term rates, investors continue to be surrounded by uncertainty as to the timing and velocity of future interest rate movements. This uncertainty creates the question of how one can protect ones capital base, while earning decent returns.

2014-10-14 Tracking the Market with Social Media by Blair Jensen of Downside Hedge

The Trade Followers Momentum indicators for the S&P 500 Index (SPX) continue to confirm lower prices with a series of lower highs. After trying to bounce, SPX broke through the 1955 support level that has been important on the Twitter stream for several weeks. It closed Friday near the next major support level of 1905 with 7 day momentum painting a small positive divergence with price.

2014-10-14 Everything Is Not As It Seems by Sean Hanlon of Hanlon Investment Management

As of September 25, 2014 the NASDAQ Composite index is up 6.95% year-to-date, despite the recent downturn in the market. The darling tech stocks continue to come up with new and innovative ideas for products and services to drive their bottom lines. The NASDAQ is only down -2.86% from the high it made on September 2, 2014. One could conclude that the NASDAQ is indeed solid and that this is just another passing correction before it pushes on to higher levels.

2014-10-14 What If We Crash? by Mark Ungewitter of Charter Trust Company

US equities are deeply oversold by many measures, and are likely to bottom here. But what if we crash? While market crashes are impossible to predict, its wise to be prepared for the occasional plunge from deeply oversold territory.

2014-10-14 You Ain't Seen Nothin Yet by William Smead of Smead Capital Management

Someone recently asked a group of us which band we saw at our first rock concert. My answer was the Canadian band, The Guess Who, in 1975. With hits like No Time, Undun and These Eyes, The Guess Who hit the perfect balance between my 17-year old testosterone driven aggressiveness and my urge to romance the woman of my dreams. The key members of the band in the 1960s and 1970s were Burton Cummings and Randy Bachman.

2014-10-14 Can The Market Make A Comeback? by Jerry Wagner of Flexible Plan Investments

Although Im a Detroit Lions fan and thoroughly enjoyed my teams rare, 19-to-7 triumph over Green Bays football team last month, Ive always respected the Packers. (Maybe because as a Lions season ticket holder since the 80s, I probably have seen the Lions lose to them more than anyone else.) They epitomize what football is all about.

2014-10-14 Rising Rate Strategy Performance in a Falling Rate Environment by Rick Harper of WisdomTree

In our view, exchange-traded funds (ETFs) can provide powerful tools for fixed income investors both big and small. Even some of the most sophisticated investment managers have used ETFs to gain broad-based exposure to certain subsets of the fixed income market.

2014-10-14 Forecasting the Market: A Thought Experiment Revisited by Colonel Chris Turner of PIEH, LLC

With Q3-14 reported earnings just beginning, here is the latest update of my ongoing "thought experiment" for forecasting the S&P 500 price based on earnings fundamentals. The chart below is based on the latest trailing twelve-month earnings (TTM) data published on the Standard & Poor's website as of October 9th, 2014. The numbers are from the spreadsheet maintained by senior analyst Howard Silverblatt. See dshort's monthly valuation update for instructions on downloading the spreadsheet.

2014-10-14 Finally, a Five Handle! by Brian Andrew of Cleary Gull

Last Fridays jobs report was significant in that for the first time since July of 2008 the unemployment rate dipped below 6%. The September report indicated that the unemployment rate fell from 6.1% to 5.9%. While we have seen improvement in labor markets for some time now, the Fed still seems to want to take their time reducing stimulative policy.

2014-10-14 Oracles Present State Looks Great But Challenges Lie in Wait by Erik Kobayashi-Solomon of YCharts, Inc.

You may think of Oracle (ORCL) as a company that sells software. In fact, at its core, it is a company that sells software updates.

2014-10-13 Air-Pockets, Free-Falls, and Crashes by John Hussman of Hussman Funds

Once overvalued, overbought, overbullish extremes are joined by deterioration in market internals and trend-uniformity, one finds a narrow set comprising less than 5% of history that contains little but abrupt air-pockets, free-falls, and crashes.

2014-10-13 New Depths of Shallowness by Michael Kayes of Willingdon Wealth Management

What happens in the corporate world often is a reflection of the values and trends in our society. Here are a couple of recent stories that, well, leave me scratching my head...

2014-10-13 The Age of Vulnerability by Joseph Stiglitz of Project Syndicate

While many countries succeeded in moving people out of poverty, the welfare of a growing number is precarious. An economic system that fails to deliver gains for most of its citizens, and in which a rising share of the population faces increasing insecurity, is, in a fundamental sense, a failed economic system.

2014-10-13 Is the UK Getting Back to Business as Usual?? by Mike Amey of PIMCO

In light of the generally buoyant economy, we may start to see more normal conditions returning to the UK labour market and, importantly, upward movement in wage growth over the cyclical horizon. In turn, these developments are critical for the conduct and timing of monetary policy and the behaviour of the Bank of England's (BOE) Monetary Policy Committee. We believe investors may want to treat the BOE's interest rate cycle with caution in shorter-maturity bonds, while valuations offer more protection in intermediate bonds given PIMCO's New Neutral thesis of secularly low real interest rates.

2014-10-13 Five Ways to Keep Out of the Bond Liquidity Trap by Douglas J. Peebles of AllianceBernstein

The good news is that liquidity risk is manageableand can even offer attractive opportunities, given the right time horizon. When liquidity dries up in one sector, it can be plentiful in another. If managed properly, it can be an additional source of returns. Here are five things investors can do to stay afloat.

2014-10-13 Europe: Draghi's Deflation Desperation by Milton Ezrati of Lord Abbett

The specter of falling prices in the eurozone is making the ECB chiefs job even harder.

2014-10-13 5% Corrections Have Been Normal in this Bull Market by Gary Black of Calamos Investments

We believe the 3Q earnings season, which moves into full swing next week, combined with greater unity by European officials on how to jump start economic growth, and additional soothing comments from our own Fed about keeping short-term rates low for a considerable time, should allow this correction to dissipate without incident, propelling the five-and-a-half year bull market to new highs.

2014-10-13 Venezuelas Spectacular Underperformance by Carmen Reinhart and Ken Rogoff of Project Syndicate

Venezuela is a major oil-exporting economy that is so badly mismanaged that real (inflation-adjusted) per capita GDP today is 2% lower than it was in 1970, despite a ten-fold increase in oil prices. Perhaps that is why its president is lashing out at academics who have the temerity to point that out.

2014-10-13 Inconceivable by Lance Roberts of Streettalk Live

The point is that there are many risks investors should not ignore. Making up losses is much harder than reinvesting stored capital once a clearer picture emerges. While the current belief that a correction of magnitude in the markets is "inconceivable," I am not sure that word means what they think it means.

2014-10-12 Japan's Amazing 25-Year Post-Bubble Drama by Doug Short (Article)

It's been quite a while since my last look at secular Japanese market and bond data. We're now just a few months from the 25th anniversary of the Nikkei 225's bubble top in 1989. The latest cyclical rally in the index an interim high at the end of December 2013, up 99.6% from its interim low in November of 2011. Its latest interim high in late September was up 100.5% from that 2011 low. The steroid effect of massive monetary intervention has evolved into an ongoing drama of volatility.

2014-10-12 Weekly Market Summary by Urban Carmel of The Fat Pitch

SPX has gone 686 days without touching its 200-dma. This is the longest stretch in history. On Friday, after a 3% fall during the week, SPX landed right on its 200-dma. It would be unusual if SPX dropped right through its 200-dma by more than ~2% without first bouncing higher. Unusual, but not impossible.

2014-10-12 Weighing the Week Ahead: Can Corporate Earnings Reports Reverse the Stock Market Decline? by Jeff Miller of New Arc Investments

Last week featured a low signal to noise ratio speech after speech, but little fresh information. This week heralds the start of earnings season. While we have a normal measure of government data, market participants will carefully parse the announcements and conference calls. This week will be all about earnings.

2014-10-11 Warning: Market Correction This Week? Did You See the Opportunity? by Frank Holmes of U.S. Global Investors

While stocks fell around the world this week amid growing concerns over global economic growth, Europes slowdown cant stop emerging market population growth that drives long-term commodity demand. If the short-term market volatility concerns you, a solution is short-term tax-free municipal bonds. Check out the 5 Reasons Why.

2014-10-11 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Hong Kong gets occupied; U.S. corporate taxes: Fact, fiction and framing; Has the U.S. Treasury blunted the Fed's QE program?

2014-10-11 Global Fears by Liz Ann Sonders, Brad Sorensen, Michelle Gibley & Jeffrey Kleintop of Charles Schwab

Volatility could continue but equity investors should keep the longer-term picture in mind, which we believe is positive. The U.S. economy is improving and monetary policy remains quite loose. The international picture is more concerning but diversification is important across asset classes. We currently favor emerging markets within a diversified international portfolio.

2014-10-11 Five Things To Ponder: Through The Looking Glass by Lance Roberts of Streettalk Live

Is this the beginning of a bigger correction, or just a respite before the next advance? This is the first correction, since the beginning of the Federal Reserves latest round of quantitative easing, where the market has broken decisively through its shorter term moving average as shown below.

2014-10-11 Investing is Like a Baseball Season (Not a Football Season) by Robert Isbitts of Sungarden Investment Research

Rather than try to out-guess the market's trader element, we prefer to act consistent with what our objectives are for each strategy. Avoiding the big loss is a prime part of that. Tracking bounce days when market activity is getting increasingly concerning to us is not. Boring? Yes. Effective at keeping our clients retired? We think so.

2014-10-11 Setting Global Standards for Central Clearinghouses by William G. De Leon, Tracey Jordal, Libby Cantrill of PIMCO

While a possible central counterparty (CCP) failure is a very remote event, there is no one single solution that alone will prevent it. However, PIMCO believes that if several conditions are met, including 1) a CCP is capitalized correctly and sufficiently with its own skin in the game, 2) segregation of client assets are consistent across cleared derivatives, 3) CCPs have a way to access cash easily to manage liquidity and 4) stress tests are consistently performed and reviewed, a CCP will be much more likely to recover than to be forced into a resolution process.

2014-10-11 Protecting Whom? by Tiffany Hsiao of Matthews Asia

China has long been accused of protectionist policies that restrict access to many markets.Recently, this has garnered more press attention. But has China really become more confrontational with U.S. business? In todays world, what exactly is protectionism, and who are these protections meant to benefit? This month Asia Insight explores.

2014-10-10 You Only Dance Twice by William Gross of Janus Capital Group

Dancing, or better yet as the beginning of my Investment Outlook suggests, being asked to dance, seems to have become an important part of my life over the past month or so. Having first been asked by my wonderful wife, Sue, and now by Dick Weil and Janus from a business standpoint, I write to you today from my desk in a new Janus office in Newport Beach, California.

2014-10-10 Bullish on Gold Priced in Euro Gold Priced in Dollars, Not So Much by Ade Odunsi of AdvisorShares

In this weeks discussion we revisit our earlier analysis looking at the relationship between the gold price and real interest rates. Over the last three months the gold price in dollar terms has fallen 9% moving briefly below $1,200 and naturally raising concerns amongst investors that this pull-back may extend as the dollar continues to strengthen against a broad basket of currencies.

2014-10-10 Practical Policy Prescriptions to Help Offset Geopolitical Uncertainties by Scott Mather, Greg Sharenow of PIMCO

We believe Europe should relax fiscal budget constraints to allow for fiscal stimulus to offset any economic drag, while maintaining extremely accommodative monetary policy. The U.S. and its relatively newfound energy renaissance can also play an important role in supporting Europe and the global economy by signaling its intention to compete for energy market share.

2014-10-10 Japan: Changes in Sentiment and Tokyo's Property Market by Dilip Badlani of The Royce Funds

In his second trip to Japan this year, Portfolio Manager Dilip Badlani observed a change in sentiment, though his bullishness on Japanese micro-caps remains unshaken.

2014-10-10 Are Hedge Funds the Great Diversifier? by Team of Milliman Financial Risk Management

The California Public Employees Retirement System (CalPERS) announced on September 15th that it would divest its entire $4.5 billion hedge fund investment. With a market value of $298 billion, a move by Calpers may be a bellwether for the industry. The decision comes at a time when many pensions are reconsidering hedge fund investments as a risk management tool.

2014-10-10 That Was the Week That Was... by Jeffrey Saut of Raymond James

A week ago yesterday I arrived in New York City just in time to have dinner with some friends. Avra Estiatorio is arguably the best Greek seafood restaurant in the city and it is located 20 steps from my hotel of choice, the Hyatt 48 lex, which is aptly named since it sits on the corner of Lexington and 48th street.

2014-10-10 The September Employment Report by Scott Brown of Raymond James

The headline figures from the September jobs report were better than expected. However, the details were more consistent with moderate growth and a continued high degree of slack. Fed officials arent going to jump to any conclusions.

2014-10-10 Japan Strategist Roundtable: Jesper KollWhat Is Different This Time? by Jeremy Schwartz of WisdomTree

When I spoke with Jesper Koll from J.P. Morgan Securities, one particular theme appeared in our conversation: Prime minister Shinzo Abe is an important catalystbut not necessarily the primary factorfor what is different this time in Japan.

2014-10-10 Divergent Returns by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

The theme for this newsletter is volatility. Not only are we seeing volatility in financial prices, but also in economic data and in some indicators we use to gauge the market's risk level.

2014-10-10 Serge Perreault's Weekend Updates by Doug Short (Article)

Note from dshort: Earlier this month I announced a policy change on the publication of dshort - Advisor Perspectives guest contributions. I'm happy to announce that long-time contributor Serge Perreault's weekend updates on both the S&P 500 and Canada's TSX Composite Index are available in PDF format here.

2014-10-09 Market Tops and Bottoms Since 1950: The October Effect by Doug Short (Article)

We're now at an early point in the Q3 2014 earnings season, which happens, of course, in October, historically the most volatile month in the U.S. stock market. Let's step for a moment into the realm of market trivia and consider the October Effect in the stock market. In the S&P 500, October is the month that has, by far, hosted the most major market bottoms -- five of the ten in the chart below. As for market tops, October has hosted only one since 1950, the high on October 9, 2007 -- the seventh anniversary of which we celebrate today.

2014-10-09 Global asset allocation outlook by Global Asset Allocation Team of Columbia Management

Recent market performance, particularly in September, has been negative across a widespread array of asset classes as we have seen the U.S. dollar exchange rate rise with increasing intensity in recent months. The worst returns, not coincidentally, were delivered by the very assets that have shown historically high sensitivity to dollar strength. This disruption to currency stability in general, and the particular importance of a rise in exchange value for the worlds reserve currency, represents an important change in capital market conditions.

2014-10-09 Warren Buffett on Buying Businesses by William Smead of Smead Capital Management

Wed like to ask a self serving and much nuanced question: is your active equity portfolio manager buying businesses for you or are they trying to guess what the stock market will do in the next month or few years? Much like Samuel L. Jackson asks, Whats in your wallet? in television commercials, wed like to ask, Whats in your portfolio?

2014-10-09 Tocqueville Gold Strategy Investor Letter by John Hathaway of Tocqueville Asset Management

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX), states in his latest quarterly letter on gold that "On a near term basis, this looks and feels like a bottom to us. On a longer term view, we are more bullish than ever." He goes on to write that "Expanding earnings and valuations, the underpinnings of the four year bull market in financial assets, may be approaching an inflection point. A reversal of this cycle would in our opinion restore interest in gold."

2014-10-09 Can Anything Go Wrong for the Markets??? by Vineer Bhansali of PIMCO

?Risk management in proper portfolio construction consists of a combination of dynamic risk balancing, diversified beta sources, explicit options-based tail hedging and a minimum amount of liquidity. Faced with a long and expanding list of things that could go wrong, uncertainties about the likelihood of each shock and the lack of dependable precursory indicators, it seems that a structurally sound portfolio construction methodology that uses all these tools is essential.

2014-10-09 2014 Outlook Update: A Year of Validation Indeed by Andrew Pease of Russell Investments

Andrew Pease, Global Head of Investment Strategy, outlines the economic and markets predictions by the team of Russell strategists at the end of the third quarter and going into the fourth quarter, comparing these forecasts to the firms Annual Global Outlook from last December.

2014-10-09 The Fed's Invisible Hand, and Other Things to Think About by Lance Roberts of Streettalk Live

I have not been a huge advocate of the Federal Reserve's QE programs for the simple reason that outside of inflating asset prices, it has done nothing for the broad swath of the American economy.

2014-10-09 Why You Should Stick With Tech Stocks by Russ Koesterich of BlackRock

Recent stock market losses have engendered a good deal of investor angst about technology stocks, but Russ believes anxiety over the technology sector is premature. In fact, it remains one of his favorite sectors. Heres why.

2014-10-09 How Alibaba Could Capitalize on the EBay-PayPal Split by Frank Holmes of U.S. Global Investors

Ebay and Paypal Split - U.S. Global InvestorsInternet auctioneer and retailer eBay announced last week that it will be spinning off its online payment service PayPal into two listed companies. This decision, heralded by activist shareholder Carl Icahn, among other investors, will allegedly enable both companies to focus exclusively on what they do best.

2014-10-09 Rethinking Core Fixed Income in a Rising-Rate Environment by Michael Hasenstab of Franklin Templeton Investments

Michael Hasenstab, chief investment officer, Global Bonds, Franklin Templeton Fixed Income Group, says it is time for fixed income investors to think outside traditional boxes. He believes that with todays market environment and the prospect of rising US interest rates on the horizon, investors need to rethink their core fixed income portfolio. He makes the case for an actively managed, global, unconstrained fixed income strategy.

2014-10-09 Putting the Pieces Together: An In Depth Chart Review of Global Financial Markets by Team of GaveKal Capital

One of our favorite grounding exercises is to peruse our chart library and review what has happened in the global financial markets so we can opine about what those prices and patterns are telling us about the world. We'll save the opining for another time, so we present the following charts with little commentary.

2014-10-09 Global Credit Market Update by Phil Apel (Article)

Phil Apel, Head of Fixed Income discusses the implications of higher interest rates in the US, currency positioning and the divergence of performance across markets both geographically and by asset class. Mr. Apel further notes that while recent volatility in credit markets, particularly in US high yield, has spooked many retail investors, portfolio managers and intuitional smart money are using the weakness to seek new opportunities at very reasonable prices.

2014-10-08 Market Volatility: Octobers in the Dow by Doug Short (Article)

Anyone who follows the mainstream financial press is seeing an increasing number of articles about bear market risk. Today's Bloomberg guest piece by Barry Ritholtz is a classic example: Signs of a Bull Market Turning Bear.

The growth in investor anxiety is happening in October, historically the most volatile month for market performance. I took a few minutes to update a couple of charts to illustrate October volatility using the Dow and starting in 1900.

2014-10-08 The State of Small-Cap Valuations and Holding High-Confidence Names by Jay Kaplan of The Royce Funds

With the U.S. economy and employment rate slowly improving, small-cap valuations may not see a correction significant enough to offer attractively discounted share prices any time soonat least at the levels that Royce typically seeks. Portfolio Manager and Principal Jay Kaplan discusses how he's been managing his portfolios in a market environment that's been largely unkind to value investors and talks about some names he likes going forward.

2014-10-08 Why Do Investors Really Underperform Over Time? by Lance Roberts of Streettalk Live

There have been numerous articles written as of late that have chastised individuals for "missing out on the bull market" which was only slightly worse than "not beating it." The reasons were chalked up to bad investment advice and paying "too much" in fees which caused the underperformance. While both of those reasons may be contributors to the problem, they are in reality on very small components of the problem when compared to the three single largest contributors to investor underperformance over time.

2014-10-08 Unemployment Dips Below 6%, But Incomes Stagnate by Gary Halbert of Halbert Wealth Management

Last Fridays unemployment report came in better than expected. The headline unemployment rate fell more than anticipated, from 6.1% in August to 5.9% last month. The number of new jobs created last month was also better than expected at 248,000.

2014-10-08 Recession Probability Models - October 2014 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession.

2014-10-08 Nervous Investors, Choppy Markets by Richard Michaud of New Frontier Advisors

It was a choppy third quarter for global asset classes. Domestically, Large Cap equities rose slightly but Small Cap US stocks fell.

2014-10-08 Letter to a Chinese "Little Emperor": It’s Nice To Be the King, but Not Always Easy by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, imagines writing to a privileged child of the "new" China, comparing such a child's coming-of-age with his own, in booming post-World War 2 France. He goes on to discuss "the curse of early money," and the pitfall it can cause for friendships and for personal development.

2014-10-08 A Japan Strategist Roundtable: What’s Next for Japan? by Jeremy Schwartz of WisdomTree

The start of 2014 was a challenging time for the Japanese equity markets. But recently things started to perk up. I recently spent time in Tokyo and want to share my observations from the trip.

2014-10-08 High Yield Market Technicals by Tim Gramatovich of AdvisorShares

It has been a long quiet period in credit but volatility has returned with a vengeance. I have had an opportunity to discuss this with a number of our institutional clients in recent days, but there are a few factors that are exacerbating the recent price declines in the high yield bond market.

2014-10-08 The S&P 500 and Recessions by Doug Short (Article)

Note from dshort: Yesterday Political Calculations posted a fascinating article entitled Dividends: A Resurgence of Recessionary Conditions, which studies the correlation between recessions and the number of companies per month announcing dividend cuts. The article prompted me to update my long-term look at the S&P 500 and recessions.

2014-10-07 dshort - Advisor Perspectives Policy Change by Doug Short (Article)

Note from dshort: We've made an editorial decision to move the bulk of our guest contributions to the Advisor Perspectives commentary feed. Those guest contributors include:

  • Lance Roberts (STA Wealth Management)
  • Jeff Miller (New Arc Investments)
  • Mike "Mish" Shedlock (Sitka Pacific Capital Management)
...and several other regular contributors
My self-authored dshort commentaries will continue to appear as they have in the past.

2014-10-07 IMF Cuts Global Growth Forecast by Doug Short (Article)

Most weekends I post an update on world market performance with a focus on eight major world indexes denominated in their own currency. This morning my friend and master market technician Chris Kimble called attention to the IMF's report posted on their website: Global Growth Disappoints, Pace of Recovery Uneven and Country-Specific:

2014-10-07 How We See Europe Panning Out by Stephen Peak (Article)

Stephen Peak, Director of International Equities, notes that overall, it's been an interesting year so far for European markets and economies. He adds that what started out as a reasonable start to the year, later began to look more doubtful as we hit mid-year. As to the markets themselves, Stephen believes good valuation opportunities exist in Europe - and notes that principally, he takes comfort in the attractiveness in multiples in Europe, specifically on a cyclically adjusted basis.

2014-10-07 What Clients Really Want by (Article)

Transamerica has been listening to hundreds of investors around the country. Hear from them about what they want.

2014-10-07 The Five Biggest Ways Your Practice Needs to Change by Bob Veres (Article)

Telling you to brace for change, over and over again, isn't exactly helping you make concrete plans. With the constant demands on your time, it would be helpful to know: What are the new realities to which you must adapt? Where are the transitions going to impact your practice? What old ways are you going to have to abandon, and what new ones will you have to adopt? Here's my list, including five that are either urgent or high-priority changes.

2014-10-07 A Q3 Letter to Clients: How to Navigate Rough Waters by Dan Richards (Article)

Each quarter I post a template for a client letter, as a starting point for advisors who want to send clients an overview of the three months that just ended and an outlook for the period ahead. Be sure to customize the letter to reflect your views, especially when it comes to recommendations for the period ahead.

2014-10-07 The Five Keys to Effective Marketing by Kristen Luke (Article)

To set yourself up for success in the coming year, put these five foundation items on the top of your list before developing your marketing plan.

2014-10-07 Motivating Advisors to Sell by Beverly Flaxington (Article)

I am frustrated by one of our advisors. He brought a relatively small amount of business with him (around $25 million) when he joined the first last year and promoted himself as having a number of connections in the community. Since that time, he has not brought in one additional dollar of new assets. How do I motivate him to sell?

2014-10-07 How Risky are Stocks in the Long Run? by Michael Edesess (Article)

What is the risk that equity investments wont turn out as well in the long run as we would like them to? This is obviously a very important question. We are often assured that stock investments will eventually pan out because of mean-reversion. However, mean-reversion in securities prices is ill-defined, oversimplified and little more than a physics metaphor.

2014-10-07 The Statistical Recovery Continues by Lance Roberts of Streettalk Live

This past Friday, investors awoke to news that, according to the U.S. Labor Department, employers added 248,000 jobs last month. In addition, job numbers for previous months were revised upward, and the jobless rate fell to 5.9% from August's 6.1%. These numbers had the mainstream media cheering that "economic victory" was nigh and stocks were propelled upward.

2014-10-07 Most Risk Assets Should Continue to Find Support by Robert Doll of Nuveen Asset Management

Equity prices continued to slide in the face of uncertainty over global growth and pending changes to monetary policy. U.S. growth is continuing to improve, and shows further signs of divergence from the rest of the world. Markets may remain sloppy for a while, but fundamentals suggest most risk assets should continue to perform well.

2014-10-07 A Case of ‘Conscious Uncoupling’ by Kristina Hooper of Allianz Global Investors

Kristina Hooper comments on the divergence of monetary policy among global central banks and why the Fed must tread lightly while acting decisively and swiftly.

2014-10-07 Welcome to the World, the Country of Catalonia? by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

On November 9, the Catalonia region of Spain is due to hold a referendum for independence. This week, we will look at the separatist movement in Catalonia. We will start by giving a brief overview of the regions history and politics, then look at the roots of the independence movement. We will explore the probability of independence, the potential future relationship between the region and the central government, and the role of the EU and the Eurozone. As always, we will conclude with market ramifications.

2014-10-07 Is Two for the Price of One always better? by Jerry Wagner of Flexible Plan Investments

I have to admit that I usually avoid shopping. Typical male behavior, I suppose, but even male shoppers stop and consider signs like Two for the Price of One! when they eventually choose to grace the shopping aisles.

2014-10-07 How M&A Resurgence May Unlock Value by Francis Gallagher, Peter Drippe of Visium Funds

Growth is a strong motivator for initiating mergers and acquisitions (M&A). For years, businesses created progressively more complex organizations, acquiring or expanding into unrelated business lines, consequently often suppressing overall company valuations. The complexity of melding disparate corporations appeared to make it exceedingly difficult for investors to evaluate companies true worth. In the present period of slow U.S. economic growth, a new trend in M&A has emerged, as many companies are reversing these moves, benefiting stock prices, investors and, potentially, the

2014-10-06 New Updates at Crestmont Research by Doug Short (Article)

Note from dshort: My friend Ed Easterling, whose Crestmont Research P/E valuation is a regular feature on this website, has published collection of periodic updates to his ongoing analysis. The commentary below is based on his latest distribution email to subscribers.

2014-10-06 The Most Important Chart in the World by Mark Ungewitter of Charter Trust Company

One of todays most glaring inter-market divergences is the relative performance of US versus non-US equities. For dollar-based investors, non-US stocks have underperformed US stocks by an astounding 40% over the past five years.

2014-10-06 ISM Data Point to GDP Growth in Q3 Well Above Potential Growth by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) released data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers, and the media as they provide the earliest reading on the current state of the economy.

2014-10-06 What’s Next from the Bank of Japan by Jeremy Schwartz of WisdomTree

I had the opportunity to meet with Takeshi Yamada of the Market Intelligence Group at the Bank of Japan (BOJ), and I attended a presentation at the Mizuho conference by Eiji Maeda, the director-general of the Research and Statistics Department.

2014-10-06 Dancing Without a Floor by John Hussman of Hussman Funds

As I did in 2000 and 2007, I feel obligated to state an expectation that only seems like a bizarre assertion because the financial memory is just as short as the popular understanding of valuation is superficial: I view the stock market as likely to lose more than half of its value from its recent high to its ultimate low in this market cycle. In my view, speculators are dancing without a floor.

2014-10-06 Bankruptcies in Denmark --> Decline in S&P 500? by Team of GaveKal Capital

Data released today revealed a jump in both bankruptcies and forced property sales in Denmark.

2014-10-06 Emerging from the Global Competitiveness Ranks by Mark Mobius of Franklin Templeton Investments

The World Economic Forum (WEF) recently released its annual Global Competitiveness Report, which details the strengths and weakness of 144 countries in myriad factors including education, infrastructure, health and technology. There arent many huge surprises in the developed markets, as most countries overall rankings were fairly stable from the prior year. There were, however, a few interesting shifts in the ranks among emerging markets: some making leaps forward, and others, regressing.

2014-10-06 Nontraded REITs’ Dividends Come With Confusion, Controversy by Walter Stabell III of Invesco Blog

Interest rates have been low for quite some time, and investors are searching for ways to generate higher yields. An increasing number of them have turned to non-exchange-traded real estate investment trusts (nontraded REITs). However, nontraded REITs offer high levels of confusion and controversy along with their high yields, and regulators are concerned that these products may not be appropriate for many of the people who invest in them.

2014-10-06 Has an Unavoidable Decline in Home Prices Begun? by Keith Jurow (Article)

In late September, the former head of Goldman Sachs' housing research team sent a lengthy report to President Obama. In it, he predicted that home prices would fall by at least 15% in the next three years. He warned that this could push the country back into a recession. With this blunt warning in mind, let's look at the state of housing markets around the country.

2014-10-05 Weighing the Week Ahead: Will global weakness drag down the US economy? by Jeff Miller of New Arc Investments

Last week was all about data. This week will be the opposite. The calendar already dished up the big news, and the major earnings reports are still a week away. Meanwhile, we have more conferences and speeches than I can remember seeing for many months. For those of us who think of data as the signal and politicians and pundits as noise, we must get ready for a low ratio! This week will emphasize commentary rather than data, with world leaders, Fed types, and pundits all joining in.

2014-10-04 The Wayback Machine Birthday Tour by John Mauldin of Mauldin Economics

Ive been writing this letter for some 15 birthdays now, well over 10,000 pages of collected work. Every word is still at my website a history, if you will, of what I was thinking at the time. I asked my longtime (and long-suffering) editor, Charley Sweet, to go back over this past decade and a half and give us a review of what I was saying my birthday week.

2014-10-04 600 Million Reasons to Keep Your Eyes on India by Frank Holmes of U.S. Global Investors

In the wake of his rock star reception at Madison Square Garden on Sunday, Prime Minister Narendra Modi has emphatically announced to our nation's top corporate and political leaders that India is now open for business. Between September 26 and 30, he met with not only President Barack Obama and other high-profile politicians but also the CEOs of some of our nation's largest and most successful companies.

2014-10-04 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

What is a good monthly U.S. payroll number?; The September U.S. job data were strong but may not move the Fed's needle; Falling inflation and inflation expectations will keep central banks from tightening

2014-10-04 Much Ado About 0.60% by Robert Isbitts of Sungarden Investment Research

Since 1962, the Dow has had a daily change of at least 0.60% over 45% of the time! ( 2014) There are 251 U.S. market trading days a year. This means that on average, about 113 trading days a year result in the Dow changing by 100 points or more, in current terms. Enough said. So, let's focus on what is really news. When market volatility truly returns, it will be like U.S. Justice Potter Stewart famously said about pornography (paraphrasing): you'll know it when you see it.

2014-10-04 What PIMCO Management Changes Mean for Investors by Team of Charles Schwab

Bill Gross resigned from his role as PIMCOs Chief Investment Officer to join Janus Capital. The PIMCO funds on the current edition of Schwabs Mutual Fund OneSource Select ListTM are not managed by Gross. There are no PIMCO ETFs currently on Schwabs ETF Select ListTM. A list of funds formerly managed or co-managed by Gross is available below.

2014-10-04 One Thing Leads to Another: From Dividends/Buybacks to Capex by Liz Ann Sonders of Charles Schwab

The final revision to second quarter real GDP showed a healthy contribution by capex. Tide may be turning away from returning cash to shareholders toward capex; pushed by activist investors.Capex's leading indicators point to further improvement.

2014-10-03 China’s Inscrutable Contraction by Kenneth Rogoff of Project Syndicate

As China shifts to a more domestic-demand driven, services-oriented economy, a transition to slower trend growth is both inevitable and desirable. But the challenges are immense, and no one should take a soft landing for granted.

2014-10-03 Gold update by Adam Feik of Take Time For This

I dont believe rising interest rates are or will be a reason for the dollar to continue to rally (or for gold prices to fall). Right now, investors seem convinced the dollars rally will continue for the foreseeable future. It may; but more likely, the dollar will continue to fluctuate when compared to foreign currencies, as well as when compared to gold. I, for one, will probably view any large declines in gold, silver, oil, gas, and the companies that produce those commodities as an opportunity to buy low. Note, Im not ready to

2014-10-03 Financial Repression (and How to Defend Yourself From It) by Mike Shedlock of Doug Short

I had the pleasure of being interviewed by Gordon Long last week. Gordon is publisher and editor of Gordon T Long Macro Analytics. The topic was "Financial Repression". What is financial repression? I defined it as "a set of fiscal and monetary policies for the expressed benefit of the ruling class: politicians, banks, and the already wealthy, at the expense of everyone else." In the video, I give numerous examples of repression, noting that central bank sponsored inflation is the epitome of financial repression. We also discuss what to do about financial repression.

2014-10-03 Our DNA by Douglas M. Hodge of PIMCO

Our investment process, which lies at the heart of the value we offer clients, is ingrained it is stamped into our DNA. Our culture of rigorous and open debate will continue to animate quarterly forums of our global investment and executive leadership, as well as the daily meetings of the Investment Committee. We remain a team-oriented organization. Indeed, it could hardly be otherwise in a firm which over many years has grown to nearly 2,500 investment professionals and staff stationed in 13 global offices, with nearly $2 trillion in assets and a full suite of strategies, including co

2014-10-03 Banquos Grain and U.S. Interest Rates by Scott Minerd of Guggenheim Partners

Early in Shakespeares "beth," Lord Banquo asks the prophetic three witches, "If you can look into the seeds of time, and say which grain will grow, and which will not, speak then to me." Banquos turn of phrase reminds us that if a farmer planted the wrong grain he could yield a poor harvest, or worse, he might even starve. I thought about this recently when asked about the outlook for U.S. interest rates. Investors, like farmers, have a sense of the seasons that guides which grains, or investments, are more likely to yield favorable results. While I have

2014-10-03 Is the Stock Market Cheap? by Doug Short of Doug Short

Here is a new update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly averages of daily closes for the past month, which is 1993.23. The ratios in parentheses use the monthly close of 2003.37. For the earnings, see the table below created from Standard & Poor's latest earnings spreadsheet.

2014-10-03 Metastability? by Jeffrey Bronchick of Cove Street Capital

We remain cheerfully bearish on fixed income and slightly less so on equity markets. The combination of volatility and confusion produces opportunities and since we have had a lot less of the former, we have seen a lot fewer of the latter. Not much of this has changed this year...but things do change-sometimes for reasons we can "see" and sometimes due to factors we can't. We remain utterly convinced that Federal Reserve policy is our greatest known unknown and we remain extraordinarily skeptical that the Great Monetary Experiment will end with a purely beneficial outcome. This quart

2014-10-03 Sector Rotations by Alexander Giryavets of Dynamika Capital L.L.C.

This year sector rotations were quite dramatic with late/early, recession and growth/value baskets swinging back and forth all along. By and large these rotations explain essentially all US equities market prices action at the level of sectors. We are taking a closer look at this year rotations, at this week action and where it can end up next as well as how to take advantage of it.

2014-10-03 Vision 1994 by Mark Headley of Matthews Asia

Twenty years ago, Paul Matthews decided to launch two Asia ex-Japan mutual funds in the U.S. and create what is today the Matthews Asia Funds. One was a core Asia ex-Japan growth fund with a mid-capitalization bias. The other fund was a unique portfolio with a focus on Asian convertible bonds. Thus began the journey of the Matthews Pacific Tiger and the Matthews Asian Growth and Income Funds.

2014-10-03 5 Things To Ponder: Motley Cognizance by Lance Roberts of Streettalk Live

It has been an interesting week in the financial markets as the current correction process has continued. As shown in the chart below, the correction has primarily occurred in the mid, small and international equities as money has rotated into mega-large cap stocks for safety.

2014-10-02 Housing Hiatus? by John Canally of LPL Financial

We continue to expect housing may add to GDP growth in 2014 and for the next several years as the market normalizes following the severe housing bust of 2005-2010. Housing affordability and supply, and the supply and demand for home mortgages, will likely determine the pace at which housing increases GDP growth in the years ahead. The inventory of new and existing homes for sale as a percentage of total households has never been lower.

2014-10-02 Will Risk Parity Performance Persist? by Chris Maxey, Brian Payne of Fortigent

With risk parity portfolios on the whole having outperformed traditional 60/40 allocations since the trough of the financial crisis, one must be mindful of the risks that lie ahead when determining the efficacy of such an approach.

2014-10-02 Voya Fixed Income Perspectives September 2014 by Christine Hurtsellers, Matt Toms of Voya Investment Management

Change is in the air, and its evident beyond the riot of color overwhelming our natural landscape. Market dynamics, too, are shifting, with the yield on the U.S. two-year Treasury inching higher and the U.S. dollar appreciating. Both not only suggest markets are pricing in a stronger U.S. economy, they are also potential harbingers that the end of zero interest rate policy is near.

2014-10-02 3Q14 Market: Small-Caps at a Relative Disadvantage by Jack Fockler of The Royce Funds

We believe that equities continue to represent an attractive option, that fundamentals matter, especially on a long-term basis, and that stock pickers, i.e., active managers, are uniquely positioned to add value in the current market environment and beyond.

2014-10-02 PIMCO Cyclical Outlook for the Americas: Recovery Remains Intact, Yet Uneven by Ed Devlin, Mike Cudzil, Lupin Rahman of PIMCO

U.S. growth can potentially exceed expectations over the cyclical horizon, in part bolstered by a healing consumer and a very accommodative Federal Reserve. While real growth in Canada has been modest in recent years, it increased to 3.1% in the second quarter and we expect that positive momentum to continue this year. In Latin America, we expect growth will pick up for the region as a whole with outperformance by smaller economies like Colombia and Panama.

2014-10-02 Six Months of Nothing by Niels Jensen of Absolute Return Partners

Political problems have escalated over the past seven months. Russia has been aggressive and so have extremists in certain Muslim countries. Having said that, financial markets seem to care about nothing but QE. Despite a growing disconnect in some markets between equity valuations and economic fundamentals, we expect the low interest rate environment to carry the equity bull market for a little longer, but eventually it will end in tears.

2014-10-02 Correction Awakens Sleeping Bears, Plunging Oil and Dollar Spikes by Lance Roberts of STA Wealth Management

Since the end of 2012, the S&P 500 has been on an inexhaustible rise despite rising geopolitical tensions, extremely cold weather and weak economic data. The driver, of course, has been the massive liquidity inflows from the Federal Reserve that have catapulted the markets from their previous upward bullish trend into an accelerated push. This is shown in the chart below.

2014-10-02 Uncertainty in markets, economy puts focus on stock picking by Michael Avery, Cynthia Prince-Fox, Chace Brundige of Ivy Investment Management Company

The U.S. Federal Reserve (Fed) has indicated it will stop buying U.S. Treasury bonds and mortgage-backed securities the taper of its QE3 program by the end of October. The Fed also has said it will keep interest rates at a very low level for a considerable time.

2014-10-01 John Templeton’s 22 Maxims for Investors and 6 Factors for Analysts by Kendall Anderson of Anderson Griggs

John Templeton was one of the greatest mutual fund managers of the 20th century. The Templeton Growth Fund was established in 1954. From then until Mr. Templeton sold the fund in 1992, a $10,000 investment with dividends and capital gains reinvested would have grown to $2 million.

2014-10-01 How High US Corporate Tax Rates Hurt the Economy by Gary Halbert of Halbert Wealth Management

The US corporate tax rate is the highest among developed nations at 35% at the federal level. Tack on state and local taxes, which can add 5-7%, and US corporations are looking at a 40%-42% income tax burden. But the US takes it even another step further, unlike any other country in the developed world.

2014-10-01 Markets’ Rational Complacency by Nouriel Roubini of Project Syndicate

A century ago, financial markets priced in a very low probability that a major conflict would occur, blissfully ignoring the risks that led to World War I until late in the summer of 1914. Back then, markets were poor at correctly pricing low-probability, high-impact tail risks; they still are.

2014-10-01 Chuck Royce on 3Q14: Is Volatility Ushering in a New Market Phase? by Chuck Royce of The Royce Funds

Volatility shook the markets in the last three months, halting the bullishand placidpace of returns in a market that has not seen a significant correction since 2011. Chief Executive Officer Chuck Royce talks about market events from the third quarter, the growing disparity between small-cap and large-cap performance, the continuing strength of the economy, the prospects for higher interest rates, the current case for small-cap quality, and more.

2014-10-01 Debeaking the Vultures by Joseph Stiglitz, et al. of Project Syndicate

In the midst of the ongoing dispute between Argentina and the vulture funds that hold its bonds, a broad consensus has emerged concerning the need for sovereign-debt restructuring mechanisms. Otherwise, US court rulings in the vultures' favor will give free rein to those who would sabotage future restructurings.

2014-10-01 Making Sense of the Bond Market by Phelps McIlvaine of Saturna Capital

A persistent reduction in the US inflation rate and well-anchored inflation expectations continue to contradict the common understanding that interest rates have reached a cyclical floor.

2014-10-01 Forget Active vs. Passive: It's All About Factors by Adam Butler, Mike Philbrick, Rodrigo Gordillo of Butler|Philbrick|Gordillo & Associates

We just love a good debate, and there seems to be quite a heated debate at the moment about the relative utility of passive versus active investing. Perhaps this debate is as timeless as investment management itself, but a flurry of recent studies may have finally armed passive advocates with enough ammunition to settle the argument once and for all.

2014-10-01 UK Joins U.S. Bombing, Courting Danger by John Browne of Euro Pacific Capital

On September 26th, the English Parliament voted to join the U.S.-led bombing of ISIL, at least in Iraq. The news was received with relief by most in the Anglosphere world and throughout Europe. However, very little regard has been paid to the relative benefits and costs. The military actions that the UK has committed herself to conduct will have a low probability of achieving the stated objective of "degrading and destroying" ISIL. However, there is a much higher likelihood that air strikes from the UK will increase ISIL's stated objective of projecting fear and terrorism deeper into

2014-10-01 Looking Back, Looking Ahead by Scott Brown of Raymond James

Real GDP is now estimated to have risen at a 4.6% annual rate in 2Q14. However, the second quarters strength must be balanced against the first quarters weakness (a -2.1% pace). As the third quarter ends, we still dont have a complete picture. However, figures are likely to suggest a moderately strong pace of growth and a gradual taking up of economic slack.

2014-10-01 Myths: Past, Present, and Future by Jeffrey Saut of Raymond James

If you dont change your indicators for the changing causal relationships you are doomed!

2014-10-01 MLP Optimism featuring David Grumhaus by (Article)

There's reason for optimism about MLP investments even in a rising interest rate environment, says David Grumhaus of Duff & Phelps.

2014-09-30 Bullish on the U.S. Manufacturing Renaissance and Cyclical Businesses by Francis Gannon and Steven McBoyle (Article)

Portfolio Manager Steven McBoyle and Co-Chief Investment Officer Francis Gannon discuss current opportunities rooted in the accelerating growth of the U.S. economy and the search for companies that are investing strategically.

2014-09-30 Five Habits of Highly Annoying Leaders by Robert Huebscher (Article)

What is the role of a leader in creating a psychologically healthy and productive workplace? More specifically, what are the things a leader has to stop doing to help teams accomplish their goals?

2014-09-30 The Client Calls You Need to Make Today by Dan Richards (Article)

It's understandable that advisors get frustrated when clients panic after small declines in the market. Here some strategies to minimize the disruption and actually turn market downturns to your advantage.

2014-09-30 The Personality Trait That Puts You at a Competitive Disadvantage by Daniel Solin (Article)

The "Solin method" for converting prospects into clients works. And it's a radical departure from the norm. It involves, counterintuitively, less work by the advisor, no selling and very little presenting. That's where I have run into trouble with advisors who exhibit a particular personality trait.

2014-09-30 Why You Should Stop Blogging About Investing by Megan Elliott (Article)

Now that virtually every advisor is a blogger, it's harder to stand out. There's no shortage of people expounding on financial planning and investing online. Here's what to write about instead.

2014-09-30 A Laser-Focused Client Referral Process by Beverly Flaxington (Article)

I am confused about something. I've heard you say we should not ask our clients for referrals, but we should identify clients to approach. Isn't this the same as asking them for help?

2014-09-30 Asset Allocation in a Time of Complacency by Dimitri Balatsos of Tesseract Partners

Complacency is a dangerous mindset, especially for investors. Having been generously rewarded beyond their expectations, investors were coddled in the arms of complacency as 2013 drew to a close.

2014-09-30 Microcap as an Alternative to Private Equity by Chris Meredith, Patrick O'Shaughnessy of O'Shaughnessey Asset management

Private equity has become a central component of many institutional and high-net-worth investment portfolios over the past decade. While private equity offers potential advantages, it also requires taking distinct risks. This paper highlights an alternative to private equitymicrocap equitieswhich mitigates several of these particular risks.

2014-09-30 How Might Stocks Take a Hike? by Milton Ezrati of Lord Abbett

Here's a look at what happened to equities during past periods when the Fed raised rates.

2014-09-30 Market Internals Continue To Weaken by Steve Rumsey of Optimus Advisory Group

The word "divergence" has crept back into the market vocabulary lately, so let's take a closer look to see what all the fuss is about. The chart below shows the percentage of stocks above their 200-day moving average peaked in the summer of 2013 and has been rolling over ever since.

2014-09-30 The Fed Trap by Stephen Roach of Project Syndicate

The US Federal Reserve is grappling with the disparity between its unconventional policy's success in preventing economic disaster and its failure to foster a robust recovery. Given that this disconnect has fueled financial-market excesses, the exit will be all the more problematic especially for the market-fixated Fed.

2014-09-30 How Vulnerable Is Short-Duration Fixed Income to Fed Tightening? by Rick Harper, Bradley Krom of WisdomTree

In recent research released by the Federal Reserve Bank of San Francisco and echoed in statements by several Fed regional bank presidents, Fed officials have voiced concerns that the market is underestimating the probability and timing of a change in monetary policy.

2014-09-30 Why We Think Tapering Is Tightening by Doug Ramsey of Leuthold Weeden Capital Management

While Fed watchers continue to debate the timing of the first post-2008 hike in the Federal Funds rate (first or second quarter of 2015), we believe the first move toward tighter policy occurred in January when the Fed first reduced the rate of its monthly bond purchases by $10 billion to $75 billion. Our opinion isnt based on any intricate knowledge of Fed liquidity flows, but simply on the subsequent action of two key stock market segments.

2014-09-30 Ebola by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

Last week marked six months since the Ebola outbreak was identified in Guinea. The current Ebola epidemic is the most severe and most complex outbreak of the disease in the history of the virus. This week, we will explore the Ebola outbreak, looking at the origin of the disease and how it has spread and developed into a serious epidemic. Although it is hard to find comparable epidemics due to its complexities, we will look at other disease outbreaks in order to gain a better understanding of the scale of the current Ebola epidemic. We will finish with geopolitical and market ramifications.

2014-09-30 Economic Atonement by Peter Schiff of Euro Pacific Capital

This Friday is Yom Kippur, the day when Jews around the world ask forgiveness for their transgressions from the year past. Rabbis remind the penitent to dwell on their sins of omission, in which they did nothing when a more thoughtful and proactive action was needed, and sins of commission, in which they actively participated in an unjust action. And while not all economists are Jewish, Gene Epstein the economics editor at Barron's, offered his thoughts on how this applies to the group.

2014-09-30 MIT AgeLab by (Article)

The groundbreaking Massachusetts Institute of Technology AgeLab is doing research, sponsored by Transamerica, that is reinventing the future of financial advice.

2014-09-29 Time for an Allocation by Tim Gramatovich of AdvisorShares

The size of the U.S. dollar high yield bond and loan market is over $3 trillion, representing nearly 30% of the corporate credit markets.

2014-09-29 Short Equity ETFs: An Imperfect Market Hedging Strategy by Bob Andres of Andres Capital Management

So the Wizard unfastened his head and emptied out the straw. Then he entered the back room and took up a measure of bran, which he mixed with a great many pins and needles. Having shaken them together thoroughly, he filled the top of the Scarecrow's head with the mixture and stuffed the rest of the space with straw, to hold it in place. L. Frank Baum, The Wonderful Wizard of Oz

2014-09-29 Slower Growth in China and Japan Pressures the Region by Scott Mather, Tomoya Masanao, Adam Bowe of PIMCO

Our forecast for the global economy is below consensus mainly because of our views for regions outside of the U.S., including Asia, the emerging markets and Europe, although higher growth in the U.S. should offset some of the slowdown we see coming from China. Japan made a kick start under so-called Abenomics with massive monetary and fiscal reflation policies, but the recent data suggest to us that the effectiveness of those cyclical policies are already challenged by secular and structural headwinds.

2014-09-29 Looking Past the Risks, Equities Still Appear Attractive by Robert Doll of Nuveen Asset Management

Last week featured some positive economic news, but equity markets sank nonetheless, with the S&P 500 Index falling 1.3%. On the bright side, we saw some strong data from the housing market and an upward revision to second-quarter gross domestic product growth (GDP).

2014-09-29 The Ingredients of a Market Crash by John Hussman of Hussman Funds

Market peaks often go through several months of top formation, so the near-term remains uncertain. Still, it has become urgent for investors to carefully examine all risk exposures. When extreme valuations on historically reliable measures, lopsided bullishness, and compressed risk premiums are joined by deteriorating market internals, widening credit spreads, and a breakdown in trend uniformity, its advisable to make certain that the long position you have is the long position you want over the remainder of the market cycle.

2014-09-28 The End of Monetary Policy by John Mauldin of Mauldin Economics

Lets explore the limits of monetary policy and think about the evolution and then the endgame of economic history. Not the end of monetary policy per se, but its emasculation.

2014-09-27 5 Reasons Why Short-Term Municipal Bonds Make Sense Now by Frank Holmes of U.S. Global Investors

Although short-term bonds might not be as sexy as common stocks in fashionable brands like Apple and Tesla, they play an important role in any serious investor's portfolio. Below are five reasons why investing in municipal bonds makes sense now more than ever.

2014-09-27 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The Federal Reserve begins looking toward the door; China's policymakers should be clearer about their intentions; Dissents at central banks are rising

2014-09-27 The Elephant Leaves the Room by Robert Isbitts of Sungarden Investment Research

The news was greeted with shock by some, while others wondered what took so long. In perhaps the first of many shoes to drop on the hedge fund industry, the largest U.S. pension fund, Calpers announced it will sell all of its hedge fund investments within 12 months. Media stories on this announcement were quick to cite lagging performance of these funds over the past year, but it appears Calpers was more concerned with the level of fees and lack of transparencythat is, they did not know what the heck was going on inside of many of the funds.

2014-09-27 Clear Sailingor Choppy Seas? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley & Jeffrey Kleintop of Charles Schwab

We are at a tenuous point in the market seasonally speaking and a pullback is quite possible. We dont recommend trying to time a potential correction, however, as that is virtually impossible and exposes investors to missed upside opportunities waiting on the sidelines. Elsewhere, the international picture looks a little shaky, but diversification is important and we do favor emerging markets within an international portfolio.

2014-09-26 Lessons From The Past by Brian Evans of AdvisorShares

Let me start by making two unremarkable statements. The first: Businesses are in business to make a profit. The second: Buying low and selling high is more effective than buying high and selling low.

2014-09-26 When it Comes to Interest Rates, Who Says What Comes Down Must Go Up? by Zachary Karabell of Envestnet

We are, at long last, nearing the end of one of the great central banking experiments: the U.S. Federal Reserves policy of quantitative easing, which began in the wake of the financial crisis of 2008-2009. While the unwinding of the monthly purchases of billions of dollars of mortgage-backed securities and other bonds has been going on for many months, markets are now increasingly attuned to what comes next. And the primary question is quite simple: will interest rates rise and if so, by how much and when?

2014-09-26 Europes Austerity Zombies by Joseph Stiglitz of Project Syndicate

If the facts dont fit the theory, change the theory, goes the old adage. But too often it is easier to keep the theory and change the facts or so German Chancellor Angela Merkel and other pro-austerity European leaders appear to believe.

2014-09-26 Reading Fed Tea Leaves by Christopher Molumphy of Franklin Templeton Investments

Monetary policy is of keen interest to fixed income investors, and the US Federal Reserve (Fed) has been known to be particularly obtuse when it comes to interest-rate talk. One thing is clear: The Fed is winding down its longstanding quantitative easing (QE) program. Whats not so clear: when the Fed will actually raise short-term interest rates.

2014-09-26 Why Large-Caps Looked Attractive to This Small-Cap Portfolio Manager by Charlie Dreifus and Dave Gruber (Article)

For Portfolio Manager and Principal Charlie Dreifus, combining a business-buyer's mentality with accounting cynicism can help reveal stock-price disparities.

2014-09-26 Many Investors Still Fear Stocks: Good News for Markets? by Russ Koesterich of BlackRock

The economy and the stock market are no longer depressed, yet the share of U.S. adults who own stocks remains at multi-year lows. Russ explains why investors havent yet fully embraced equities and what this could mean for longer-term stock market performance.

2014-09-26 After Considerable Time, Fed to Define Highly Accommodative by Scott Minerd of Guggenheim Partners

As the Federal Reserve maintains a highly accommodative monetary policy the central bank runs the risk of allowing the U.S. economy to overheat.

2014-09-26 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

The Weekly Leading Index (WLI) of the Economic Cycle Research Institute (ECRI) is at 134.9, down slightly from the previous week's 135.6. The WLI annualized growth indicator (WLIg) is at 2.0, down slightly from the previous week's 2.1. On Wednesday, September 10th, Lakshman Achuthan appeared on Wall Street Journal Live, where he stated that Japan is on track for another recession. He included comments about what that means for Europe and the United States.

2014-09-25 How Plan Sponsors Can Prepare for the Coming Changes to Mortality Tables by Thomas Egan of Columbia Management

The name may sound like something from Star Wars, but RP-2014 is actually the draft mortality tables released by the Society of Actuaries (SOA) earlier this year. These revised tables highlight longer life expectancies and faster increases in mortality improvements, affirming the well-established belief that individuals are living longer. The draft is currently under review by various stakeholders with the expectation that RP-2014 will be formalized this year.

2014-09-25 Playing Defense in Emerging Market Fixed Income by Bradley Krom of WisdomTree

When looking around the global fixed income landscape, investors searching for income potential have essentially two choices: non-investment grade debt or emerging markets (EM). While high yield flows continues to dominate the headlines, emerging markets have generally flown under the radar in recent months. In this discussion, we focus on how investors may be able to best position against a change in Federal Reserve (Fed) policy while maintaining income potential from investments in emerging markets.

2014-09-25 Awakening Japan Inc. by Yu Zhang of Matthews Asia

Japanese Prime Minister Shinzo Abe's first two "arrows" of his expansionary fiscal policies have done well to curb deflation. Now, investors are concerned about Japan's so called "third arrow"the country's growth strategy. Can credible structural reform be implemented to remove impediments to its growth?

2014-09-25 Dont Fight the ECB? Part 2 by Burt White of LPL Financial

Last week we discussed why buying European stocks now, following the recent stimulus announced by the ECB, is very different from buying U.S. stocks during periods of Fed stimulus in recent years. This week we take a deeper dive into the investment opportunity in Europe and evaluate fundamentals, valuations, and technicals. We recommend that investors fight the ECB. We do not believe the additional stimulus is enough for us to recommend European equities over U.S. equities at this time.

2014-09-25 Europe’s Commercial Real Estate Deleveraging: ‘Not Too Fast, Not Too Slow’? by Tareck Safi, Tom Collier of PIMCO

As European bank deleveraging accelerates, we expect that commercial real estate (CRE) will continue to constitute a significant proportion of bank assets to be sold, albeit with a shifting geographical mix. We believe CRE opportunities remain in the form of single assets and complex structured transactions in particular; but a disciplined approach will be key given competition in specific types of assets and in certain jurisdictions. This will require flexible capital, local investment expertise and hands-on asset management, in addition to strategic sourcing capabilities.

2014-09-25 Gold and US Monetary Policy by Ade Odunsi of AdvisorShares

In this weeks Gold Report we conduct a historical analysis of the impact of US monetary policy announcements on the price of gold in US dollars. Beginning with the Federal Reserves extra-ordinary 75 basis point Fed Funds rate cut in January 2008 and the most significant central bank policy announcements since, the analysis looks at the resulting reaction of the gold market and the US 10 year real yield over a three month period.

2014-09-25 The Largest Stocks Are Carrying The MSCI World Index by Team of GaveKal Capital

The 50 largest stocks in the MSCI World Index account for roughly 28% of the total market cap of the MSCI World Index. So for a market-cap weighted index such as the MSCI World, the movement of the largest 50 stocks (out of 1615 total stocks) can have an outsized effect on the performance of the index as a whole at certain times.

2014-09-25 Three Reasons to Consider EM Asia by Russ Koesterich of BlackRock

Though EM stocks have been struggling of late, Russ still believes investors should have emerging market exposure, particularly in emerging Asia. He provides three reasons why.

2014-09-25 China Defies Analysts Predictions with an Encouraging PMI by Frank Holmes of U.S. Global Investors

HSBC announced Tuesday that the preliminary purchasing managers index (PMI) for China rose to 50.5, a modest improvement from Augusts 50.2. Analysts were expecting the index to decline to a neutral 50.0, based on softening factory employment, but this is a case when youre relieved others were off the mark.

2014-09-25 Market Outlook featuring Ken Fincher by (Article)

Despite gains this year in the CEF market, it may be wise to prepare for a possible 4th quarter pullback, says Ken Fincher of First Trust Advisors.

2014-09-25 Happiness Revisited: A Household Income of $75K? by Doug Short (Article)

Note from dshort: I've updated this commentary in the wake of the Census Bureau's release last week of the 2013 annual household income data from the Current Population Survey.

One of my favorite discussions on APViewpoint, which addressed "The Sad State of Happiness" included an indirect reference to a popular 2010 academic study by psychologist Daniel Kahneman and economist Angus Deaton. Their topic was the correlation between annual household income and day-to-day contentment.

2014-09-25 Global Equities Stay Thirsty for Liquidity by Rick Golod of Invesco Blog

Taking a step back from the usual economic and market insights, my September commentary is devoted to a topic that Ive been long overdue in addressing. Financial advisors have frequently asked about my approach to asset allocation, and Ive outlined my strategy for diversifying within the US equity space in my commentary, Harnessing the Markets Natural Rotation: An Asset Allocation Strategy. Here, Id like to provide a summary of my outlook, which remains unchanged from the previous month.

2014-09-24 Buffetts Passive Can of Worms by William Smead of Smead Capital Management

A great deal of confusion exists today about the merits of passive investing as compared to well-researched active management. An added layer of confusion arose in March when Warren Buffett explained that 90% of his widows money would be invested in a low-cost S&P 500 index fund. If this summer was a football game, 15-yard personal foul penalties would be thrown everywhere as experts piled on top of that announcement.

2014-09-24 Open Sesame by Brian Andrew of Cleary Gull

Often times, investors are interested in pursuing investments in the hottest asset class. The hype surrounding the Alibaba IPO is an example of how a sector gets a boost from a hot new stock. The fact that the stock traded up almost 40% in the first day of trading is an indication that the sector is hot. It is difficult not to want to add more capital to that portion of your portfolio that is performing best while ignoring the portion that isnt performing as well. Of course that is exactly what you are supposed to do and what rebalancing is all about.

2014-09-24 Equities: Finding the Path to Value? by Virginie Maisonneuve, Anne Gudefin of PIMCO

Going forward, earnings growth and stock selection - more than multiple expansion and beta - will likely play a bigger role in driving positive returns. Our research has uncovered numerous examples of stocks trading below our estimate of intrinsic value - notably in Europe and various special situations. Investors with the capacity for deep, fundamental research and a long-term unconstrained equity strategy may be positioned to capitalize on these opportunities.

2014-09-24 Fed Forecasts Sub-3% Economy for the Next Three Years by Gary Halbert of Halbert Wealth Management

The Feds policy committee announced last Wednesday that it will end its massive QE bond buying program at the end of next month, thus paving the way for the first Fed funds rate increase sometime next year. This was not a surprise. The Feds gargantuan balance sheet will peak near $4.5 trillion in Treasury and mortgage-backed bonds at the end of October.

2014-09-24 India: A Bright Spot in Emerging Markets by Christopher Gannatti of WisdomTree

In 2013, emerging markets were the laggards of the global equity markets. 2014 has seen some bright spots, but various uncertainties, most notably with respect to Russia, have tended to constrain equity rallies. However, there is one market that seems to have completely shrugged off 2013 concerns and emerge as an extremely strong performer thus far this year.

2014-09-24 U.S. Budget: The Good, the Bad, and the Ugly by Milton Ezrati of Lord Abbett

A report from the Congressional Budget Office forecasts shrinking deficits through 2015. After that, fiscal strains begin to emerge.

2014-09-24 Bull Market Mirage by Team of GaveKal Capital

On an equal weighted basis, the MSCI World index is up 2.58% YTD, is down 3.39% QTD and down 3.01% MTD. The equal weight index gives us a better idea of our chances of picking stocks that outperform.

2014-09-23 Jeremy Siegel vs. Zvi Bodie: Does Equity Risk Decrease Over Time? by David Blanchett, Michael Finke and Wade Pfau (Article)

Stocks should be the asset class of choice for the long run, according to Wharton Professor Jeremy Siegel - and he has provided the data to prove it. But that paradigm has been challenged by Boston University Professor Zvi Bodie and others, who have shown that stocks become riskier the longer one owns them. Either view has profound implications for whether equity allocations should increase or decrease over time. Using Monte Carlo simulations, we provide guidance for the advisory profession.

2014-09-23 The Tax Harvesting Oasis - A Response to Michael Edesess by Daniel Egan and Boris Khentov (Article)

In a recent article, poetically titled "The Tax Harvesting Mirage," Michael Edesess referenced our firm's Betterment TLH+ service and the performance estimate we have published and attempted to estimate the value of TLH on his own. We would like to highlight where our assumptions differ from Edesess' and why we believe ours are appropriate.

2014-09-23 The Tax Harvesting Water Hole by Michael Edesess (Article)

Michael Edesess responds to Betterment's critique of his article on its tax-harvesting alpha.

2014-09-23 Why "Healthspan" Trumps "Lifespan" for Clients by Dan Richards (Article)

Advisors spend a great deal of their time with clients who ask, "Will I run out of money?" As a result, few issues get more attention than the sustainable withdrawal rate in today's environment. But new research shows that an equally pressing question is, "How can I enjoy life in my 60s, before health issues creep in?"

2014-09-23 What Makes a Powerful Website? by Beverly Flaxington (Article)

We are redoing our website. Any tips on how to attract prospects?

2014-09-23 Weekly Market Update by Team of Castleton Partners

In a week defined by increased rate volatility, Treasury yields ended mixed, as the yield curve continued to flatten. Registering its first monthly decline in over a year, the Consumer Price Index (CPI) continued to support a benign inflationary environment, further supporting long-dated instruments. With global inflation subdued, central banks around the world remain more concerned about lapsing back into recession than about frothy risk markets and potential bubbles.

2014-09-23 Back to Iraq by Bill O'Grady of Confluence Investment Management

President Obama has decided to build a coalition to dislodge the Islamic State (IS). The U.S. is leading the coalition, but American efforts will be limited to air power. In this report, we will offer a short synopsis of the war plan. This analysis will be followed by a broader discussion of U.S. Middle East strategy, including a history of American policy. We will move to discuss the most likely outcome from these efforts and conclude, as always, with market ramifications.

2014-09-23 The U.S. Dollar is Rising, Interest Rates Could Be Next by Rick Harper, Bradley Krom of WisdomTree

Since bottoming July 1, the U.S. dollar has mounted an impressive rally against virtually every major foreign currency. While many analysts have been predicting a secular appreciation in the U.S. dollar on account of stronger economic fundamentals, the current rally has caused even casual market participants to take notice.

2014-09-23 Keeping Up With Global Relative Performance Trends by Team of GaveKal Capital

The MSCI All Country World Index (ACWI) is a comprised of two basic pieces: the MSCI World (Developed) Index, which contains about 1,600 companies and the MSCI Emerging Markets Index, which contains about 850 companies. The MSCI ACWI is a good global reference point for measuring relative performance trends.

2014-09-23 Stocks Rally Following Janet Yellens Conference and Scotlands Historic Referendum by Frank Holmes of U.S. Global Investors

Interest rates cant stay zero forever, but for now its more of the same.

2014-09-23 Sisyphus Succeeds! by Jeffrey Saut of Raymond James

I have been reminded of the Greek mythology character Sisyphus since mid-July as investors tried to roll an immense boulder up a hill, only to watch it roll back down. In this case the boulder in question has been the D-J Industrial Average (INDU/ 17279.74), which since late July has tried seven times to better its all-time high of 17138.20 made on July 16th of this year.

2014-09-23 The Dots by Scott Brown of Raymond James

As was widely anticipated, Federal Reserve policymakers reduced the monthly pace of asset purchases by another $10 billion and kept the considerable time language. Fed policymakers revised slightly their forecasts of growth, unemployment, and inflation. However, the really interesting item in the Feds Summary of Economic Projections was the dot plot, the projections of the appropriate year-end level of the federal funds rate for each of the next few years. There is a huge range of uncertainty among Fed officials.

2014-09-23 She's the Decider by (Article)

Transamerica's New Age of Advice went to a Denver park and asked these couples who makes the financial decisions in their households. Guess what they had to say.

2014-09-23 Potential Benefits of Dividend-paying Equities by Alex Crooke (Article)

Alex Crooke, Head of Global Equity Income, discusses income paying shares and Henderson's equity income strategies (HFQAX, HDAVX). Alex believes that dividend paying shares provide the best long term total return for investors: relatively safe in volatile markets and yet investors are still participating in growth of company's profit and earnings through a dividend stream. Overall Morningstar Rating based on risk-adjusted returns for Class A and I shares among 314 Foreign Large Value funds as of 8/31/14. The information in this article does not qualify as an investment recommendation.

2014-09-23 Bullish on Japanese Small-Caps by Francis Gannon and David Nadel (Article)

While the macroeconomic picture in Japan is unsettling for many investors, we are finding what we think are inexpensive high-quality businesses across many industries. Royce International Smaller-Companies Fund Portfolio Manager and Director of International Research David Nadel talks about how he is positioning his portfolio and explains why he has confidence in FamilyMart, a Japanese convenience store chain.

2014-09-22 It Will Take More Than ECB Rate Cuts for the Eurozone to Fully Recover by John Greenwood of Invesco Blog

The European Central Banks (ECB) surprise rate cuts on Sept. 4 reducing its main lending and deposit rates by 10 basis points show that its policies so far have been inadequate to solve the euro-areas economic malaise. Economic growth has stalled, and deflation remains a threat in the eurozone. The rate cuts may help to weaken the euro further in the currency markets, but nobody should be under any illusion that banks will start lending or expanding their deposits as a result of the rate cuts alone, or that these cuts will trigger a wider economic recovery.

2014-09-22 The Ponzi Economy by John Hussman of Hussman Funds

When the most persistent, most aggressive, and most sizeable actions of policymakers are those that discourage saving, promote debt-financed consumption, and encourage the diversion of scarce savings to yield-seeking speculation rather than productive investment, the backbone that supports a rising standard of living is broken.

2014-09-22 Fed Keeps Considerable Time But Ups Rate Expectations Through 2017 by Liz Ann Sonders of Charles Schwab

The Fed kept its statement largely intact relative to Julys; opting to retain the much-ballyhooed considerable time phrase. It was confirmed that QEs tapering would be concluded by the end of October; while the Feds rate expectations were increased. Yellen took great pains to explain that considerable time should not be considered calendar-based guidance.

2014-09-22 It’s Time for Your Portfolio to Break from Tradition by Kathleen Gaffney, Kevin Dachille of Eaton Vance

Given the current low-yield environment and with rising interest rates looming, now may be the right time to consider new strategies for generating favorable returns in your fixed-income portfolio.

2014-09-22 A Lack of Surprises Helps Equity Markets Make Gains by Robert Doll of Nuveen Asset Management

Equity markets rose again last week, with the S&P 500 Index climbing 1.3% and reaching another record high. Bond yields and the U.S. dollar drifted higher, while emerging market equities and commodities struggled. Two major events that resulted in a continuation of the status quo helped market sentiment.

2014-09-22 Michael Aronstein on the Fed's Latest Mistake by Robert Huebscher (Article)

Since the Fed began its post-crisis monetary easing, a cult of second-guessers has emerged. The most extreme cry of "dollar debasement" or admonish that markets are doomed for hyperinflation. The more reasonable view, articulated by Michael Aronstein at a recent conference for financial advisors, is that near-zero interest rates and QE have distorted markets, but it is unclear when or how that will impact investors.

2014-09-22 Copper Breaking Through Important Support as USD Continues to Surge by Team of GaveKal Capital

Copper, after having been turned down by the falling trendline last week, is breaking down through the upward sloping support line today.

2014-09-22 A Simple Tool To Increase AUM by Daniel Solin (Article)

Telling someone how to become a better manager is easy. But motivating the advisors at your firm is surprisingly difficult. Doing so effectively is a simple way to increase your AUM.

2014-09-22 Two Themes Investors Should Focus on Now by Russ Koesterich of BlackRock

With countries growth, monetary policy and market performance increasingly diverging, Russ shares two themes investors should focus on as year-end approaches.

2014-09-22 Alternative Approaches for Managing Emerging Market Equity Portfolios by Roger Edgley, Laura Geritz, Andrey Kutuzov, and Ajay Krishnan of Wasatch Funds

The shortcomings of indexing are especially evident in frontier markets, where some very small markets have significant weights. This paper discusses three approaches for targeting inefficiencies in emerging markets. These approaches are designed to fit together and complement each other within an investment portfolio. Overlap is generally minimal, so investors may reasonably employ all three.

2014-09-22 Destroying the Dollar a Penny at a Time by Editorial Team at Peter Schiffs Gold Blog of Euro Pacific Precious Metals

Efforts are once again underway to discontinue the US penny due to the rising cost of zinc. But it is not zinc that is becoming more precious, but rather the dollar that is losing value relative to all commodities. A comparison of product prices over time shows that a dollar just isnt what it used to be.

2014-09-22 Evaluating Break-Even Levels when Interest Rates Rise by Yung Lim of AdvisorShares

In the current low interest rate environment across the Treasury curve and investment grade credit space, low coupon rates provide less protection against market value loss resulting from rising interest rates. When interest rates were higher, fixed income investors enjoyed the benefit of earning higher recurring income to offset any market value declines.

2014-09-22 Certainty is Not the Same as Precision: What Feels Like Stability Often Is Only an Ephemeral Equilib by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, looks at the seemingly stable state of the current bull market and examines research on how and when such "stability" erodes. Hint: very quickly and without discernible warning. He explores the "Black Swan" and "Fingers of Instability" research by Nassim Taleb and John Mauldin respectively, noting that: "even experts who have analyzed how shocks to the system might strike have failed to offer precise warning systems."

2014-09-22 Yellen to the Markets: Come to Me by Bradley Harper of WisdomTree

By most accounts, the Federal Open Market Committee (FOMC) statement released September 17 failed to break much new ground in terms of changes to policy or language. The Federal Reserve Board (Fed) met expectations with another measured step in its tapering process, by trimming $5 billion of Treasury and $5 billion of mortgage-backed securities purchases from its asset purchase program.

2014-09-21 Wheres the Growth? by John Mauldin of Mauldin Economics

Call me a heretic, but I take a different view than the economists in charge. To my mind, the sluggish recovery is a sign that central banks, governments, and, quite frankly, the textbook economists (despite their best intentions) are part of the problem. As Detlev Schlichter commented in his latest blog post (Keynes was a failure in Japan No need to embrace him in Europe), To the true Keynesian, no interest rate is ever low enough, no quantitative easing program ever ambitious enough, and no fiscal deficit ever large enough. It&r

2014-09-20 Stocks Rally Following Janet Yellen's Conference and Scotland's Historic Referendum by Frank Holmes of U.S. Global Investors

This news gives stocks reason to rally for a considerable time, or at least until the Fed gives us a more concrete timeframe for a rate hike.

2014-09-19 Median Household Income by State: A Sobering Look at the Data by Doug Short (Article)

The Census Bureau's annual household income reports for 2013 were published this week. I've now compiled a few tables for the 50 states and DC based on the Current Population Survey, a joint undertaking of the Census Bureau and Bureau of Labor Statistics, which includes annual data from 1984 to 2013. The details are fascinating, if somewhat sobering.

First, some context. The median US income in 2013 was $51,939, up from $22,415 in 1984 -- a 131.7% rise over the 29-year timeframe.

2014-09-19 Finding Appropriate Investment Strategies for Client Portfolios by Chuck Self of iSectors

Financial advisors (FAs) utilizing outsourced investment management processes face a significant number of choices. Recently, there were 675 exchange-traded fund (ETF) investment strategists in Morningstars database. How does one narrow the list of choices for further investigation effectively?

2014-09-19 Panic in Bermuda: When Your Business Turns into an “Interesting New Asset Class” by Krishna Mohanraj of Diamond Hill Capital Management, Inc.

All else equal, we prefer to invest in strong franchises in stable industries. However, even within industries undergoing turmoil, understanding the differing prospects of individual firms can present us with attractive investment opportunities, both long and short.

2014-09-19 Why the Pennant Race Could Coincide with Market Volatility by Scott Minerd of Guggenheim Partners

While the U.S. economy is gaining momentum, investors should nevertheless brace for volatility in the next few weeks.

2014-09-19 Banking on the Growing Strength of the Financial System by Dave Ellison of Hennessy Funds

Thiscommentary explores the U. S. financial systems profound changes. In 2007, the financial system began to unravel due to excessive leverage, credit risk and overall business complexity. As we look forward, we see a potentially more stable profit picture developing for these firms. And, a rising interest rates environment has historically translated to increased revenue for banks and financial institutions. Dave Ellison believes the financial sector is ripe with opportunity.

2014-09-19 Muni Issues featuring John Miller by (Article)

Interest rates and Fed policy are key investor concerns regarding municipal bonds, says John Miller of Nuveen Asset Management.

2014-09-19 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The choice for Europe: coming together or breaking apart; Scotland votes nay; The dollar has been the beneficiary of global uncertainty

2014-09-19 Bad Breadth by Robert Isbitts of Sungarden Investment Research

Investors have heard about record highs in the stock market for months now. Headline indices like the S&P 500 and the Dow 30 broke their record highs this summer, and are still quite close to them. But what about the other indices? According to a recent Bloomberg article, About 47% of stocks in the Nasdaq Composite Index are down at least 20% from their peak in the last 12 months while more than 40% have fallen that much in the Russell 2000 Index and the Bloomberg IPO Index. Some will refer to this as a two-tiered market. We prefer to call it "bad breadth."

2014-09-19 Municipal HY Attractive Relative to Corporate HY by Andrew Clinton of Clinton Investment Management

Given the steady and significant compression of corporate high yield (HY) spreads/yields, I am forwarding the attached illustration depicting the ratio, or yield, of the Barclays Municipal HY Index relative to the Barclays Corporate HY Index.

2014-09-19 A Revolutionary Idea: Investing in Europe (even Russia) by Tucker Scott of Franklin Templeton Investments

The eurozone appeared to have emerged from a prolonged recession when conflict in Ukraine intensified earlier this year with Russias annexation of Crimea. The continued complexity of the crisis in Ukraine now threatens to derail Europes fragile economy, and European stocks have suffered. That said, more attractive valuations in Europe may lure investors back to European stocks, according to Tucker Scott, portfolio manager and executive vice president, Templeton Global Equity Group. He sees opportunity through the fog of crisis and makes a case for finding value in Europe&m

2014-09-18 The Myth of Student Debt: Lies, Damned Lies and Statistics by Cole Smead of Smead Capital Management

As school season kicks off, we at Smead Capital Management have been perplexed by the logic and reasoning over the student debt debate in America. There is a consensus in the investment markets today believing that student debt is a major credit problem rivaling other credit problems that were disastrous over the last 30 years.

2014-09-18 A New Fed Playbook for the New Normal by Peter Schiff of Euro Pacific Capital

While many economists and market watchers have failed to notice, we have entered a new chapter in the short and checkered history of central banking. This paradigm shift, as yet unaddressed in the textbooks, changes the basic policy tools that have traditionally defined the sphere of macroeconomic decision-making.

2014-09-18 Gold for the Long Run by Ade Odunsi of AdvisorShares

We continue on the theme gold and the dollar but this week take a short look at their long-term relationship and relative movement over the last 40 years. In particular we focus on the period post the ending of the Bretton-Woods agreement by the Nixon administration in 1971 (the so-called Nixon Shock) which terminated dollar convertibility to gold and thus established the dollar as a fiat currency.

2014-09-18 Room to Run by Marie Schofield of Columbia Management

The U.S. economy passed a milestone of sorts in August, in that the current business cycle has now surpassed the last one in length. The prior business cycle started in 2001 and continued until the December 2007 peak, lasting 6.8 years. This is longer than the post-war average of 5.6 years, but shorter than the business cycles in the 1980s and 1990s which lasted 9 to 10 years.

2014-09-18 What the Scottish Referendum & Fed News Could Mean for Investors by Russ Koesterich of BlackRock

Last weeks stock losses were partly a reflection of investors looking ahead to the Scottish independence vote this Thursday and the Federal Reserve (Fed)s statement on Wednesday. Russ weighs in on the investing implications of these two big news events.

2014-09-18 The Sand Demand: Finding Opportunities Beyond Direct Shale Plays by Frank Holmes of U.S. Global Investors

Total U.S. crude oil production averaged an estimated 8.6 million barrels per day in August, the highest monthly production since July 1986, according to the Energy Information Administration (EIA). In our Special Energy Report: An American Energy Renaissance, we highlight that just a few years ago investors were contemplating the supply constraints facing the petroleum industry, but with the disruptive technology in shale oil and gas in the U.S., we could now be looking at decades of drilling ahead.

2014-09-18 “You’re Going to Need a Bigger Boat”: Alpha and Interest Rates by Brooks Ritchey of Franklin Templeton Investments

Caution has been the dominant sentiment among investors in recent times even as equities have continued to march along. But as the prospect of rising US interest rates becomes ever more real, Brooks Ritchey, senior managing director at K2 Advisors, Franklin Templeton Solutions, takes a look at how some individuals and institutions are changing their guarded approach. He says alternative investments could find increased interest among savvy investors as interest rates start to tick higher.

2014-09-18 More than Half of EM Stocks are Down At Least 10% From Their High by Team of GaveKal Capital

The MSCI Emerging Markets Index is down about 4% from its recent high, but the average stock has fared much worse. By our count more than than 50% of EM stocks are down at least 10% from their 200-day high. The trend of more stocks being down at least 10% from their recent high can be seen in all regions, but is clearly most prevalent in Latin America, where the number has increased from 22% to 60% in a week.

2014-09-18 Mind Your Language! by Scott Brown of Raymond James

The Federal Open Market Committee is widely expected to take another trip to Taper Town on Wednesday, reducing the monthly pace of asset purchases by another $10 billion, one step closer to ending the program in late October. The more interesting issue is whether well see any change in the Feds forward guidance on short-term interest rates specifically, whether the FOMC will jettison the considerable time language.

2014-09-18 Then and Now by Jeffrey Saut of Raymond James

Dallas-based Greenbrier Partners is captained by my friend Frederick E. Rowe, who is fondly referred to as Shad. Now anyone from Virginia is familiar with the fish known as a shad, and are probably familiar with the political event known as the Shad Planking.

2014-09-17 U.S. Household Incomes: A 46-Year Perspective by Doug Short (Article)

The Census Bureau has now released its annual report household income data for 2013. It is posted on the Census Bureau website. What I'm featuring in this update is an analysis of the quintile breakdown of data from 1967 through 2013 along with the statistics for the top 5%.

2014-09-17 Median Household Incomes by Age Bracket: 1967-2013 by Doug Short (Article)

Earlier today I updated my commentary on household income distribution to include the Census Bureau's release of the 2013 annual data. My focus was on arithmetic mean (average) household incomes by quintile (and the top 5%) over the 46-year history of this data series. The analysis offered some fascinating insights into U.S. household incomes.

2014-09-17 Don't Be Surprised by Surprises by Michael Kayes of Willingdon Wealth Management

We live in a complicated world of heightened anxiety. Read why this is good for stock prices.

2014-09-17 Fed Policy: From Tapering to Tightening by Rick Harper, Bradley Krom of WisdomTree

Over the past nine months, the Federal Reserve (Fed) has gradually reduced the pace of its asset purchases in conjunction with an improvement in the strength of the U.S. economy. With tapering expected to end October 29, we believe that investors should now look beyond 2014 and start to focus on when, not if, the Federal Reserve will raise the Federal Funds Rate.

2014-09-17 Fall FOMC Watch by John Canally of LPL Financial

We continue to expect the Fed to again cut its bond purchase program and remain on pace to exit QE by year end. However, odds have increased that the Fed could change something at this weeks FOMC meeting, including omitting its promise to keep rates low for a considerable time or providing the public with an update to its exit strategy. We are continuing to watch our Yellen indicators, including the unemployment rate, the job quit rate, and the output gap, to gain insight into whether the Fed will raise rates sooner than expected.

2014-09-17 Markets Rose-Tinted World by Mohamed El-Erian of Project Syndicate

This has been an unusual year for the global economy, characterized by a series of unanticipated economic, geopolitical, and market shifts and the final quarter is likely to be no different. So why are financial markets behaving as if they were in a world of their own?

2014-09-17 Abenomics 2.0 by Kenichi Amaki of Matthews Asia

The reversal of Japan's equity markets so far this year, have led investors to wonder, "Is Abenomics working?" There are hundreds of components that comprise this economic plan, and among the recent successes has been job creation. However, macroeconomic statistics point to some emerging near-term challenges, including still-muted wage growth. This month Kenichi Amaki takes a look at both current pressures and progress in Japan.

2014-09-17 America in the Driver’s Seat – Enjoy the Ride by Doug MacKay, Bill Hoover of Broadleaf Partners

Like clockwork, earnings season has drawn to a close, creating an information vacuum for the stock market, one in which the media spends more time "making" the news than perhaps reporting it. The marginal dollar at trade - or the price maker in a high frequency dominated trading world - is one more likely to be concerned about the Fed's words over the next two days than the stream of earnings produced by corporate America over the next few quarters.

2014-09-17 Are Government Bonds Really "Safe"? by Dickson Buchanan of Euro Pacific Precious Metals

One of the striking ironies of our modern economy is that government bonds are considered safe-haven investments, while gold is a barbarous relic to be avoided at all costs. Since the 2008 financial collapse, the bond market has been on a tear, thanks to the Federal Reserves endless interest rate suppression. This has only served to reinforce the traditional notion that government bonds are safe.

2014-09-17 Will the Scottish Vote on Independence Be the "Black Swan"to Financial Markets? by Dawn Bennett of Bennett Group Financial Services

I wonder if the issue of an independent Scotland would actually be something of a black swan for the U.S. and world financial markets? According to Reuters, the international news agency, investors this past month, August 2014, have pulled approximately $27 billion out of UK financial assets. This is the biggest capital outflow since the Lehman crisis in 2008.

2014-09-17 U.S. Household Incomes: A 46-Year Perspective by Doug Short of Advisor Perspectives (

The Census Bureau has now released its annual report household income data for 2013. It is posted on the Census Bureau website. What I'm featuring in this update is an analysis of the quintile breakdown of data from 1967 through 2013.

2014-09-17 Median Household Incomes by Age Bracket: 1967-2013 by Doug Short of Advisor Perspectives (

Earlier today I updated my commentary on household income distribution to include the Census Bureau's release of the 2013 annual data. My focus was on arithmetic mean (average) household incomes by quintile (and the top 5%) over the 46-year history of this data series. The analysis offered some fascinating insights into U.S. household incomes.

2014-09-16 Advice in the Shadow of Dementia by (Article)

Hear straight from someone with dementia about what financial advisors can do better.

2014-09-16 Median Household Income Growth: Deflating the American Dream by Doug Short (Article)

What is the single best indicator of the American Dream? Many would point to household income growth. The Census Bureau has now published some selected annual household income data in a new report: Income and Poverty in the United States: 2013. Last year the median (middle) household income was $51,939 -- a 1.8% year-over-year increase that shrinks to 0.3% when adjusted for inflation. Let's put the new release into a larger historical context.

2014-09-16 Gundlach on Today's Surprising Driver of Bond Prices by Robert Huebscher (Article)

Inflationary pressures could ultimately trigger an uncontrollable spike in interest rates, according to Jeffrey Gundlach, but such predictions are likely at least five years too early. In the short run, he identified the key driver that will keep rates low - the strong performance of European bond markets.

2014-09-16 It's All About the Little Things: 10 Small Steps for Treating Clients Well by Sponsored Content from Transamerica (Article)

The secret to offering service that's so good that it's memorable is to pay attention to the details. Here are 10 small steps for treating clients well, starting with one that's so simple, yet sometimes easy to mess up.

2014-09-16 The Key Problem with Monte Carlo Software - The Need for Better Performance Metrics by Joe Tomlinson (Article)

Popular financial-planning software packages have shortcomings in the metrics they use to evaluate the outputs from Monte Carlo simulations; other metrics provide more useful information. I will address how to measure the performance of financial plans when variable investment returns and longevity are introduced and demonstrate that the most-commonly used measures have weaknesses.

2014-09-16 Authoritarianism versus Democracy: The Key Challenge to Chinese Ascendancy by Michael Edesess and Kwok L. Tsui (Article)

An intense debate has been underway for more than a decade about whether the East - China in particular - is in the ascendancy. Some argue this is so and that the West is in decline. Others say China's flawed political institutions will limit its monumental growth and render it precarious. This an especially opportune time to address these questions.

2014-09-16 Why Account Minimums Threaten Your Business by Dan Richards (Article)

The disciplined implementation of ever-increasing account minimums has boosted productivity for many advisory practices. Yet those same account minimums threaten the future sustainability of advisor practices, if applied too rigidly. Here's why.

2014-09-16 A Powerful New Weapon to Gather AUM by Daniel Solin (Article)

Establishing a bond with a prospect through shared interests - such as hobbies - is a powerful way to improve your chances of them becoming a client. But what if those common interests don't exist?

2014-09-16 What are the 'Magic Words' to Re-engage Past Clients? by Beverly Flaxington (Article)

My partner and I left a firm where we worked with clients for years. It's very disheartening how few of our former clients have followed us to our new firm. In some cases, they won't even return a phone call. What magic words can we use to get them re-engaged with us?

2014-09-16 Now is the Time to Build Your 2015 Marketing Plan by Mandy Fisher (Article)

There are four building blocks that create a well-balanced marketing plan for financial advisors: infrastructure, awareness, lead generation and conversion. I will walk you through each block so that you have a clear understanding of what they are and how you can build your 2015 marketing plan.

2014-09-16 Weekly Market Update by Team of Castleton Partners

After a strong summer rally, the first two weeks of September have not been kind to US financial markets, with both stock and bond markets generating negative returns. In the month to date, ten year Treasury yields have risen twenty five basis points to 2.60%, the highest such level since the first week of July.

2014-09-16 Cycling Through History by Willie Delwiche of Robert W. Baird

Certain seasonal adages will doubtless sound familiar. "As goes January, so goes the year" seems to be repeated as a rule sometime in early February, while "Sell in May and go away" reflects not only the conditioned expectation of summer weakness, but also a preference for sayings that rhyme. Perhaps the proliferation of these sayings partially explains why the actual timing of cyclical shifts can catch some investors off guard.

2014-09-16 Stocks vs. High Yield Munis by Richard Bernstein of Richard Bernstein Advisors

The track record of the so-called "Fed Model" is dubious at best. The relationship compares the S&P 500's earnings yield to the yield of the 10-year Treasury note, and there are many other indicators that have a better track record than does the Fed Model when attempting to predict twelve-month forward returns. Despite that caveat, we nonetheless thought it interesting to examine the yield relationships between stocks and a broader array of fixed-income categories. Among those categories, high yield municipal bonds can be the only fixed-income that is attractive relative to stock

2014-09-16 Of Kilts, Ballots, Bankers and Dots by Kristina Hooper of Allianz Global Investors

Kristina Hooper breaks down the hairy mix of economic data, central bank policy and geopolitical events, including Scotland's potential exit from the UK, that markets are combing through right now.

2014-09-16 Stocks Slip on Quiet Data Week by Chris Maxey, Ryan Davis of Fortigent

A modest number of economic indicators were released last week, with the majority suggesting that the domestic economy remains on solid footing. Consumer sentiment and retail sales were the bright spots, after concerns about what impact the weak labor report would have on the consumer.

2014-09-16 The Case for Predictable Growth Stocks by Team of Value Line Funds

When investors think of growth companies, high-flying, large tech stocks, such as Facebook, Google and Apple, often come to mind. By definition, growth stocks have faster earnings growth and, therefore, higher valuations, but many also offer a more predictable pattern of growth with less price volatility and smoother returns over time. Furthermore, many of these steady growth stocks have historically outperformed peers over the long term.

2014-09-16 Indonesia by Kaisa Stucke, Bill O'Grady of Confluence Investment Management

The recent presidential election in Indonesia has attracted international interest as both candidates platforms included promises of import substitutions, export restrictions and retention of production processes in Indonesia. Although Indonesia holds substantial growth promise for foreign investors, the potential trade restrictions are making international companies nervous. This report discusses Indonesia, briefly describing its history, economy and political landscape. It delves into the election, promises made on the campaign trail and the implications of the results on foreign inve

2014-09-16 Economic Update by Team of Cambridge Advisors

After a rocky month in July, stocks resumed their march higher in August. The S&P 500 was up 4.0% for the month and is up 9.9% year-to-date. The small cap Russell 2000 index also performed well for the month, up 5.0%. Year-to-date, small cap stocks have lagged and are up only 1.75% as of the end of August. International stocks continued to struggle in August and year-to-date with performance of -0.4% and +2.93% respectively.

2014-09-16 Is Profiting in the Stock Market Based on Illusions? by Jerry Wagner of Flexible Plan Investments

When I was a child, I was fascinated with magic and magicians. I read scores of books, learned loads of tricks, and put on magic shows (ten-cent admission) in our basement. My favorite part was the illusions (I once worked a part of a summer vacation mastering a very convincing floating wand).

2014-09-16 High Yield in a Rising Rate Environment: A Perspective on Historical Performance by Heather Rupp of AdvisorShares

Since 1980, Treasury yields have increased (i.e., interest rates rose), in 15 of those years. In every one of those years, high yield has outperformed the investment grade market. The long-term numbers show that over those 15 years since 1980 where we saw Treasury yield increases (i.e., interest rates rose), high yield had an average return of 13.7% (or 10.4% if you exclude the massive performance in 2009). This compares to only a 4.5% average return (or 3.6% excluding 2009) for investment grade bonds over the same period.

2014-09-15 CEF News Update featuring Maury Fertig by (Article)

Patient investing is advised with closed-end funds, says Maury Fertig, in a roundup of recent CEF news reports and commentary.

2014-09-15 Implications of European Central Bank actions by Phil Apel and James McAlevey (Article)

Phil Apel, Head of Fixed Income and James McAlevey, Head of Interest Rates examine the implications of the recent European Central Bank (ECB) monetary stimulus measures where policy rates were cut by 10bp while a program of asset-backed securities and covered bond purchases was announced. With the ECB taking up the QE baton, Europe is clearly decoupling from the US, intensifying the contrasting fortunes of the two markets. Phil and James share their views and explain how their portfolios are positioned in light of the recent market trends.

2014-09-15 Bulls Charge Despite Weak Data by Scott Minerd of Guggenheim Partners

As the U.S. Federal Reserve debates withdrawing accommodation the doves have the upper hand, but that does not mean they wont make a concession to hawks and hike sooner than the market expects.

2014-09-15 A Wee Problem for the UK by John Browne of Euro Pacific Capital

Last weekend several polls emerged that shockingly forecast Scottish independence from Great Britain is within the realm of political possibilities.

2014-09-15 General Electrics Business Strategy by Erik Kobayashi-Solomon of YCharts, Inc.

Despite the many products and services provided by GE, its business strategy is actually startlingly simple. In short, GE is betting on the continued flourishing of the human race. The company is divesting consumer-facing assets and acquiring or boosting commercial-facing ones in what we term the PIT Strategy. An analysis of the companys valuation drivers suggests an upside potential of the 40% range for GE.

2014-09-15 Emphasize Barriers to Entry? by Mark Kiesel of PIMCO

We see many bottom-up investment opportunities in the global credit markets, particularly in industries with high barriers to entry. We view healthcare, lodging, Asian gaming, master limited partnerships/pipelines, energy, wireless telecom, cell towers, cable, satellite, media and U.S. banks as attractive industries. Companies unique patents, licenses, brands, content and intellectual property, among other advantages, can help support investment returns in both bull and bear markets.

2014-09-15 Understanding the Potential Risks and Rewards of Alternative Investments by Bob Andres of Andres Capital Management

Today, Investors are confronted with constructing or restructuring an asset allocation model in an environment where traditional equity and fixed income securities are fully valued. As a result, investors may be facing a period of nominal or negative returns from both of these traditional asset classes. In this environment, alternative investments may play a pivotal role in providing investors with broad diversification, lower correlations, and as a result, enhanced downside protection.

2014-09-15 The Economy: September Viewpoint by Bruce Laning of Bronfman E.L. Rothschild

The U.S. economy experienced a robust summer for economic expansion and job growth, however recent consumer data is casting doubt as to whether the current level of activity can be sustained. Our position is to maintain an emphasis on higher-quality bonds and be prepared for short-term rate increase(s) in the months to come. The road ahead for stocks continues to look positive, but it would be prudent to keep in mind the inevitable speed bumps that will likely present themselves down the road, as we have not had a meaningful pullback since 2011.

2014-09-15 The U.S. Is Diverging From Other Developed Markets by Robert Doll of Nuveen Asset Management

U.S. equities fell amid a relatively quiet week, with the S&P 500 Index dropping 1.1%. The upcoming Federal Open Market Committee (FOMC) meeting drew quite a bit of attention amid increased speculation that the Federal Reserve may start signaling its long-awaited move to increase rates.

2014-09-15 Why Development Trumps Acquisitions in Our Real Estate Portfolios by Paul Curbo of Invesco Blog

One of the trends affecting real estate markets this year is the increasing difficulty commercial real estate companies are facing as they seek to complete potential acquisitions. Strengthening commercial real estate fundamentals, coupled with the low cost of financing, have resulted in a large increase in the number of bidders for assets in the past several quarters.

2014-09-15 Bill Hench on Health Care and Energy by Bill Hench (Article)

Portfolio Manager Bill Hench talks to Principal Dave Gruber about value opportunities he saw in the Health Care and Energy sectors and events in those areas that benefited some of his stock picks.

2014-09-15 How Quality Can Lead in the Small-Cap Market by Chris Clark and Chuck Royce (Article)

While quantitative easing has allowed financially leveraged companies to improve their fiscal health over the past several years, Chuck Royce sees signs of small-cap leadership for quality moving forward.

2014-09-14 Whats on Your Radar Screen? by John Mauldin of Mauldin Economics

So lets look at whats on my radar screen today. First up (but probably not the most important in the long term), I would have to say, is Scotland. What has not been widely discussed is that the voting age was changed in Scotland just a few years ago. For this election, anyone in Scotland over 16 years old is eligible. Think about that for a second. Have you ever asked 16-year-olds whether they would like to be more free and independent and gotten a no answer? They dont think with their economic brains, or at least most of them dont.

2014-09-13 Patiently Waiting for Mean Reversion by Frank Holmes of U.S. Global Investors

Because small caps tend to have higher beta than blue chips, you would expect them to outperform in a generally rising market?which we?re currently in. So it appears that a major rotation out of these riskier, more volatile stocks has inexplicably occurred, leading to the wide bifurcation between small and large companies. The good news is that, based on 20 years of historical data, stocks in the Russell 2000 tend to rally in the fourth quarter and continue steadily until around the end of the first quarter. Over this 20-year period ending in December 2013, the Russell has generat

2014-09-13 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The implications of Scottish independence; U.S. consumer spending outlook remains positive.

2014-09-13 Anarchy in the U.K. by Robert Isbitts of Sungarden Investment Research

This weeks blog borrows its title from one of the early anthems of the 1970s Punk Rock era. At a time when terrorism dominates the global newswire, another part of the world is erupting in what could become a market-moving chain of events. This is accompanied by an atmosphere that can appropriately be described as vicious (Baby Boomer alternative music buffs from their college days hopefully get the pun there).

2014-09-13 Will the Russia-Ukraine Crisis Chill Europe’s Recovery? by Philippe Brugere-Trelat of Franklin Templeton Investments

As the crisis in Ukraine and resulting geopolitical tensions between Russia and the West continues with no durable solution yet, many investors have responded by exiting European companies with exposure to the Russian economy. But even as evidence mounts that the Ukraine crisis is taking a toll on many European economies, it would be imprudent for long-term investors to give up on investing in Europe. Strong corporate earnings momentum, high dividend yields and the possibility of additional support from the European Central Bank (ECB) are just some of the reasons why he remains confident that,

2014-09-12 U.S. rates The Draghi floor by Zach Pandl of Columbia Management

In typical fashion, last weeks European Central Bank (ECB) announcements found a way to bury the lede. The deposit rate cut to -20 basis points from -10 basis points was characterized as a technical adjustment, and the asset purchase program, while important, lacked a specific quantitative targetforcing investors to infer a rough figure from Mario Draghis comments in the press conference.

2014-09-12 Distressed Corporate Credit: A Tale of Two Markets? by Sai S. Devabhaktuni of PIMCO

Middle market distressed credit may be an attractive source of higher returns in an overall low yield environment for investors able to access these opportunities. However, the higher return potential comes with greater risks. Imbalances in middle markets are building. ?Investors looking toward distressed credit markets should focus on companies that will likely be able to withstand periods of economic inertia, to undertake careful valuation practices and to strictly adhere to the absolute priority rule (in which senior creditors are paid in full before junior creditors).

2014-09-12 Conditions are right for the dollar to weigh on gold by Ade Odunsi of AdvisorShares

In last weeks Gold Report we looked at the historical relationship between the gold price in dollars and the value of the dollar, as measured by the Intercontinental Exchange US dollar trade weighted index (USDX) and found a strong inverse relationship between the two a strong dollar has historically tended to be associated with a weak gold price.

2014-09-12 Schwab Market Perspective: Diverging Paths…Growing Risks? by Liz Ann Sonders of Charles Schwab

The U.S. stock market continues to reach new highs but sentiment is extended and we are entering a period that has historically seen weakness. We believe the ultimate trend is higher, but bumps could get more pronounced in the near future. The U.S. economy is improving, with data suggesting self-supporting expansion is taking hold. Whether this means accelerated Fed interest rate hikes is being closely watched, while midterm elections often inject some more uncertainty into the market. The European Central Bank (ECB) finally acted, but structural issues and lack of demand remain problems.

2014-09-11 Understanding China's Property Market by Andy Rothman of Matthews Asia

One of the biggest misconceptions about Chinas property market is that most buyers are speculators. In fact, the residential market is driven by owner-occupiers, and even many poor Chinese are homeowners; China is a global leader in homeownership with urban ownership rates at 89%. The boom days may be over, but fundamental demand remains healthy. New home prices rose at an average annual pace of 9% over the last eight years, but nominal urban income rose 13% per year. Communist Party leaders do not appear too worried about property; theyve taken only modest steps to support the m

2014-09-11 Doubling Down on Inflation by Peter Schiff of Euro Pacific Capital

Friday's release of disappointing August payroll numbers should have been a jarring wake-up call warning Wall Street that the economy has been treading on thin ice. Instead the alarm clock was stuffed under the pillow and Wall Street kept sleeping.

2014-09-11 Calm Down 2 by Jeffrey Saut of Raymond James

In last Fridays Morning Tack I referenced some sage advice from the legendary Dow Theorist Richard Russell of Dow Theory Letters fame.

2014-09-11 As The World Turns ... by Scott Brown of Raymond James

U.S. economic data were mixed last week, but there was nothing in the August Employment Report to suggest that growth is slowing down. A surprise move from the European Central Bank pushed the euro lower, but there appears to be a lot more that the ECB can do.

2014-09-11 Diversifying With the Yen? Not if Japanese Equities Are Involved by Jeremy Schwartz of WisdomTree

The discussion of currency-hedged strategies has shaken some of the core beliefs of investors. Traditional investment vehicles that package equity risk plus a secondary currency risk on top of the equity risk have been referred to as the traditional plain vanilla exposure because they were the first to the market, and it is what investors have been using for so long.

2014-09-11 The Leapfrog: The Role of Technology in Accelerating Emerging Markets Growth by Mark Mobius of Franklin Templeton Investments

The potential for emerging and frontier markets to realize accelerated economic growth as a result of new technology transfer comes up regularly in our research findings. We have been increasingly excited about a new developmentthe capacity for new technology, particularly related to data over the Internet, to completely bypass swathes of older technology and business activity. We think this could lead to even more dramatic economic progress. In effect, the emerging markets are leapfrogging over the old technology and taking advantage of the newest technology today.

2014-09-11 Mind the Gap-- or Absence Thereof! by Team of GaveKal Capital

In spite of recent headlines and developments at the ECB, market action has remained fairly subdued, as evidenced by the number of stocks that jump (in a positive or negative direction) at the open of trading.

2014-09-11 ECB Measures Highlight Draghis Determination by David Zahn of Franklin Templeton Investments

The reduction in eurozone interest rates announced on September 4 by European Central Bank (ECB) President Mario Draghi came as a bit of a surprise to some market players. But David Zahn, Head of European Fixed Income and portfolio manager, believes that this move, along with the confirmation of the commencement of the banks asset-backed securities purchase program, is very much in line with its previous action and suggests a central bank president who is in control and determined to get the eurozones economy back on track.

2014-09-11 Why Growth Stocks Now? by John Calamos of Calamos Investments

After five years of a strong bull market, I believe theres still room for stocks to advance. Growth stocks look especially attractive. At 1.23, the premium for growth over value remains lower than the historical average of 1.44. Even when we omit the tech bubble from the long-term average, the 1.23 premium for growth is lower than that 1.37 average.

2014-09-11 Parallels to 1937 by Robert Shiller of Project Syndicate

The depression that followed the 1929 stock-market crash took a turn for the worse eight years later, and recovery came only with the enormous economic stimulus provided by World War II, a conflict that cost more than 60 million lives. The global situation today is not nearly so dire, but there are parallels, particularly to 1937.

2014-09-10 Pray for Rain by John Heldman of Triad Investment Management

California, along with many other parts of the country, is experiencing a severe drought. The state's major reservoirs are at 60% of capacity. Agriculture, consumer of 80% of California water, is reeling.

2014-09-10 Labor Force Participation Lowest in 36 Years - Why? by Gary Halbert of Halbert Wealth Management

Last Fridays unemployment report for August was significantly weaker than expected. While the headline unemployment rate dipped back to 6.1% (same as it was for June), the number of new jobs created last month was substantially below expectations and marked the lowest number of the year.

2014-09-10 Scottish Independence Vote: Investor Implications by Axel Merk of Merk Investments

Is your portfolios fate dependent on Scotlands? Why is it that when a place known for haggis, kilts and bagpipes indicates it might want to be independent, the markets pay attention?

2014-09-10 Why Take Currency Risk if Diversification Benefit is Declining? by Jeremy Schwartz of WisdomTree

We have been exploring the case for layering in foreign currency (FX) on top of foreign equity returns. One of the most common arguments I have heard for taking on FX risk in international equity portfolios in an unhedged fashion is that FX can be a portfolio diversifier.

2014-09-10 High Yield Bonds and Interest Rates by Heather Rupp of AdvisorShares

Over the last month, we have seen the equity markets hit all-time highs, all the while bond investors seem to be indicating there are reasons to be concerned, sending the 10-year Treasury to the lowest yields seen over the past year.

2014-09-10 A Global Growth Slowdown? by Russ Koesterich of BlackRock

As 2014 is shaping up to be another year of below-trend economic growth, many investors are wondering: Is economic growth once again slowing? Russ explains why his answer is no.

2014-09-10 Strong U.S. Dollar Weakens Gold Prices this September by Frank Holmes of U.S. Global Investors

Last week I wrote about the historic correlation between the month of September and the strength of gold. Now it appears that this September might be shaping up as one not to remember but forget.

2014-09-09 MLP View featuring Mike Taggart by (Article)

MLPs have been a hot area in the investment world, including the closed-end fund market, says Mike Taggart of Nuveen Investments.

2014-09-09 Family Web by (Article)

Meet the Baker family. This modern American family is the perfect example of how an individual client's finances often involve members of every generation.

2014-09-09 Current Opportunities in International Small-Caps by (Article)

International Smaller-Companies Portfolio Manager and Director of International Research David Nadel tells Co-Chief Investment Officer Francis Gannon where he is finding opportunities in the international small-cap market.

2014-09-09 What is "Fee-Only?" Is the CFP Board Taking the Right Approach to Defining it? by Bob Veres (Article)

Which is more important to your advisory practice - your CFP designation or your fee-only status? Before you answer, consider this: Your CFP mark says very little about whether you adhere to a fiduciary standard, and less about your mode of compensation. Those issues are at the forefront of an ongoing controversy pitting the CFP Board against a prominent advisor, and there is little sign that its outcome will resolve the ongoing debate about how to define a fee-only professional engagement. If anything, it raises more questions than answers.

2014-09-09 How Rare are Housing Bubbles? Understanding the Case-Shiller Index and its Counterparts by Cesar A. Orosco and Laurence B. Siegel (Article)

Do house prices experience periodic bull and bear markets like the stock market? Or are they stable in real (inflation-adjusted) terms most of the time, with big disruptions once or twice in a century? Two popular house price series tell these very different stories. Knowing which is better will lead to superior investment outcomes and improved policy decisions.

2014-09-09 The #1 Hot-Button Topic for Wealthy Families by Dan Richards (Article)

The financial and emotional cost when important topics go undiscussed is so great that in many cases, facilitating that conversation is the No. 1 way that advisors can make a positive impact in the lives of wealthy clients.

2014-09-09 Why Using Humor Will Increase Your AUM by Daniel Solin (Article)

We take ourselves too seriously. As investment advisors, it's appropriate that we view our responsibilities with a solemn sense of mission. After all, we are often accountable for the prudent management of our clients' life savings. But that doesn't mean our relationships with clients should be humorless.

2014-09-09 Why Multifamily Housing is Booming (and Single-Family Isn't) by David Schawel (Article)

The rebound in single-family housing has been tepid. Investors must understand the underlying structural changes, especially why demand has shifted toward multifamily housing and why this shift will persist in the years ahead.

2014-09-09 Why You Shouldn't Trust Client Surveys by Beverly Flaxington (Article)

Our clients said in the survey that they recommend our firm to others, but our actual client referrals are relatively low.

2014-09-09 Growing Income and Wealth with High-Dividend Equities by C. Thomas Howard, PhD (Article)

High-dividend equities have significant advantages for growing income and wealth: getting sufficient yield, keeping up with inflation and outliving available funds. Such a portfolio produces higher income per dollar invested, growing income and principal over time, higher total returns, lower volatility and a reduced risk of outliving savings.

2014-09-09 Market Perspective by The CCR Wealth Management Investment Committee of CCR Wealth Management

In our office we frequently make sport of the countless headlines we encounter on a daily basis from various media outlets across the web. These headlines are often splashed across the home pages of market or financial sitesthough often across mainstream news outlets, or the business sections of Sunday newspapers as well.

2014-09-09 Divergence by Kristina Hooper of Allianz Global Investors

A widening gap in monetary policy in the United States and Europe reveals the disparity in economic growth that exists. Kristina Hooper explains the implications for investors and what history reveals about periods of Fed tightening.

2014-09-09 Hiring Flounders in August and Extreme Seasonal Distortions by Chris Maxey, Ryan Davis of Fortigent

With expectations high, the August labor report landed with a reasonably loud thud. Economists expected recent improvements in labor markets to continue aplenty, but that proved not to be the case during the oftentimes-volatile month of August. It is never wise to read too much into a singular month, and the details of this report support that notion.

2014-09-09 Xis Purge by Bill O'Grady of Confluence Investment Management

Since taking power, Chinese President Xi Jinping has implemented a strong program to punish corruption. A large number of the Communist Party of China (CPC) have been under investigation or punished for their failings. We believe these purges are being implemented for reasons beyond the simple exercise in political power. This report will discuss the purge in detail, introduce the concepts of environmental and social capital, and discuss Chinas four stages of growth. We will conclude, as always, with market ramifications.

2014-09-09 Escape Fandango? by Paul McCulley of PIMCO

When I entered the Fed-watching business over three decades ago, a clichd phrase of advice from graybeards was: Watch what they do, not what they say. Thinking back, there was not actually much Fed rhetoric to either watch or hear.

2014-09-09 Is it Time to Take the Euro Out of Europe? by Jeremy Schwartz of WisdomTree

On September 4, the European Central Bank (ECB) took further accommodation to support the economic growth environment in Europe. As a result, the euro collapsed about 1% immediately after the news, while European stocks rose on prospects for more monetary policy easing. This reaction mirrors what we saw in Japan in 2013, and it strengthens the case for taking the euro out of Europe.

2014-09-09 The Risk of Permanent Loss by William Smead of Smead Capital Management

Since the stock market has done extremely well from its abyss-like low in March of 2009, many investors are worried about the risks associated with owning U.S. large-cap stocks. A cacophony of articles have been written which not only look for the stock market to correct, but also have an expectation of the kind of bear market decline which would set investors back for five years, like the declines in 2000-02 and 2007-09. Those declines each hit the S&P 500 Index for a loss of 40% or more.

2014-09-09 Back to School With the Three Rs: Revenues, Reinvestment, and Renaissance by Burt White, Jeffrey Buchbinder of LPL Financial

We believe the three Rs are keys to the outlook for the stock market: revenues (and profits), reinvestment, and the renaissance in manufacturing. We expect stocks to garner support from these three Rs in the form of continued growth in revenues and profits, more corporate reinvestment, and continued steady gains for the U.S. manufacturing sector.

2014-09-09 Staying Ahead of the Curve by Chris Diaz of Janus Capital Group

Investors could soon face an environment of rising U.S. interest rates and heightened rate volatility. Already, the Federal Reserve has begun setting the stage by tapering its quantitative easing program. Once rates start to rise, its difficult for a fixed income portfolio to make up lost ground if its not already positioned for higher rates. We think its crucial for investors to diversify their yield curve exposure by investing abroad.

2014-09-08 Correlation Convergence is Hurting Your Investment Performance by Vern Sumnicht of iSectors

Correlation is a statistical term that helps describe the relationship between two investments, enabling an investor to determine how similar two investments are to each other. By understanding the correlation between the investments in a portfolio, an investor can understand how likely it is, for example, for two or more of those investments to gain or lose money at the same time.

2014-09-08 Are Municipals Allergic to Basel? by Bob Andres of Andres Capital Management

One of the bogeys of the Basel Accords calls for dramatic improvements in bank liquidity. The most recent changes to the Liquidity Coverage Ratio (LCR) test changed the numerator in the equation to ease the strictness of qualifying assets. The formula divides a banking institutions stock of high quality liquid assets (HQLA)the numeratorby estimated total net cash outflow over a 30-day period in a stressed environment. The calculation must be at least equal to or greater than 100 percent at all times.

2014-09-08 The Two Pillars of Full-Cycle Investing by John Hussman of Hussman Funds

History teaches clear lessons about the varying merits of accepting market risk.

2014-09-08 Searching for Value in Global Small-Cap Stocks by Virginia Au of Invesco Blog

While many global small-cap companies have gotten their balance sheets in good shape over the last few years, valuations are currently a concern. The MSCI World Index is up 184% since the market low on March 9, 2009, and we believe most equities are at or near full value. This makes it much harder to find high-quality companies at cheap prices. Against this backdrop, the challenge is to find the hidden gems within the vast universe of global small-cap companies.

2014-09-08 Only 37% of Companies Are Seeing Rising Sales Estimates by Team of GaveKal Capital

Yesterday we noted the fact that EPS estimates have fallen versus 3 months ago for most stocks in the developed world. In a similar vein, today we note that top line estimates are rising for only 37% of stocks in the MSCI developed world index, meaning they are falling for 63% of stocks. The only region in which more than half of stocks are seeing rising sales estimates is North America, where 62% of companies have seen top line estimates rise versus three months ago.

2014-09-08 A Choppy Path Stretches Ahead, but It Could Favor Equities by Robert Doll of Nuveen Asset Management

U.S. equities continued their winning ways, with the S&P 500 Index advancing 0.2% last week. Although the August employment data were somewhat disappointing, investors were cheered by strong manufacturing trends. Events outside of the U.S. also contributed to the positive tone.

2014-09-08 What Tax Strategies Make Sense for You? by Tara Thompson Popernik of AllianceBernstein

Many investors adopt tax-reducing strategies from year to year without taking a step back to look at the big picture. But how you save or spend money today can have a profound impact on your after-tax wealth over the long term and, ultimately, on your legacy.

2014-09-07 Europe Takes the QE Baton by John Mauldin of Mauldin Economics

This week well look at what is happening across the pond in Europe, where the above-mentioned negative rates are only one ingredient in a big pot of Bizarro soup. And well think about what it means for the US Federal Reserve to be so close to the end of its quantitative easing, even as the ECB takes the baton to add 1 trillion to the worlds liquidity. And meanwhile, Japan just keeps plugging away.

2014-09-06 The New Challenges of Price Discovery by Frank Holmes of U.S. Global Investors

In the past few years, price discoveryor the act of finding the right price for a securityhas become much more challenging because of falling stock volume and widening bid-ask spreads. These challenges are directly attributable to the infiltration of high-frequency traders into the market, not to mention the expansion of dark pools and non-exchange trading.

2014-09-06 Are US Stocks Reacting Rationally? by Grant Bowers of Franklin Templeton Investments

When major market indexes reach new heights, some investors may become wary. Given that the US stock market has enjoyed robust total returns over the past five years (20092013), its only natural to question the sustainability of rising stock prices.Grant Bowers, portfolio manager of Franklin Growth Opportunities Fund, believes many of the same drivers of stock market performance over the past few years remain in place, including low inflation, healthy corporate profits and accommodative monetary policy. However, he also cautions that volatility is likely to pick up, particularly

2014-09-06 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Can the eurozone avoid Japanification?; U.S. employment: Less rosy than expected; The U.S. capital spending outlook is promising

2014-09-06 Roll Em if Youve Got Em by Robert Isbitts of Sungarden Investment Research

Investors and their advisors have eased into the perceived comfort of evaluating investment results over standard, fixed time periods, such as year-to-date or the past 1-3-5 years. These are all valid time periods to review, but I dont think they are enough.

2014-09-06 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (

The Weekly Leading Index (WLI) of the Economic Cycle Research Institute (ECRI) is at 134.9, little changed from the previous week's 134.8. The WLI annualized growth indicator (WLIg) dropped to 1.8 from the previous week's 2.3. Last Friday, August 29th, ECRI treated the general public to a new commentary on its website focused on the Fed's seeming complacency about inflation becaused of stalled wage growth. ECRI sees a substantially higher inflation risk.

2014-09-06 Back in the Saddle Again: Time to Pull in the Reins? by Liz Ann Sonders of Charles Schwab

Interest rates and seasonal tendencies are taking some attention away from the stronger economy and pose short-term risks for the stock market. Another pullback would be welcome from a sentiment perspective and would not dent our longer-term optimism that we are in a secular bull market that still has room to run. But just as fear has been the strongest emotion keeping many investors out of this bull market, greed is an emotion to rein in as well.

2014-09-05 Markets Climb as World Faces Crisis by John Browne of Euro Pacific Capital

On August 28th while the geographical area formerly known as Iraq descended further into chaos, President Obama announced to the world "We don't have a strategy, yet." A few days later, another brave American journalist was brutally beheaded by a slickly televised cockney-accented jihadist. Clearly things are not going well outside the bubbly confines of the S&P 500.

2014-09-05 True Grit: The Durable Low Volatility Effect by Feifei Li, Philip Lawton of Research Affiliates

There is no assurance that low-risk stocks will continue to produce superior long-term returns. Nonetheless, due to investors preferences and managers incentives, the outlook remains promising. And the market does not seem to learn from experience.

2014-09-05 Will Russia Derail the Eurozone Recovery? by Nicola Mai of PIMCO

Geopolitical tensions from Ukraine and the evolving trade war with Russia are threatening what is already a weak recovery in Europe, and could shave approximately 0.3%0.4% off eurozone growth. Should the situation escalate, we could expect an even greater drag with potential to push the eurozone back into recession. Looking ahead, we see attractive opportunities in peripheral bonds and favour an underweight currency position in the euro.

2014-09-05 Gold in the Time of the US Dollar by Ade Odunsi of AdvisorShares

Continuing on the theme of the impact that strength in the US dollar might have on the price of gold in dollars, in this weeks discussion we investigate the close historical relationship between the price of gold expressed in dollars and the value of the dollar.

2014-09-05 Cyclicals: Early or Late by Team of GaveKal Capital

For the first part of the year, early cyclicals (consummer discretionary sector) in North America underperformed late cyclicals (energy, material and industrial sectors), which made perfect sense given the appearance of a strengthening economy and the tapering of FRB asset purchases. Recently, however, early cyclicals have come back to lead late cyclicals. Since June 23, early cyclicals have outperformed late cyclicals by 7%. In the chart below, we compare an equal weighted basket of early cyclical companies in North America against late cyclicals.

2014-09-05 Remember, Remember, Gold in September by Frank Holmes of U.S. Global Investors

In American poet W. S. Merwins poem To the Light of September, the speaker calls the ninth month still summer, yet with a glint of bronze in the chill mornings. I agreeto an extent. Here in San Antonio, Texas, home of U.S. Global Investors, were most definitely still in the summer season. But in the investing world, when we talk about September, theres a glint not of bronze but another precious metal: gold.

2014-09-05 Voya Global Perspectives Market Update by Douglas Cot of Voya Investment Management

A hawk in doves clothing, Yellen will likely be ahead of the curve when it comes to hiking rates. Driven by strength in manufacturing and a revitalized consumer, corporate America is thriving. The euro zone is an economic basket case, forcing Draghi to reach for another bazooka solution, to the likely benefit of risk assets. Broad, globally diversified portfolios can help protect investors against the volatility that policy normalization may bring.

2014-09-05 Tennis star Li Na exemplifies China's newfound entrepreneurial spirit. by Patricia Huang of Matthews Asia

After advancing to her first grand slam semifinals, Peng Shuai is China's newest late-career surprise at the U.S. Open. Her compatriot, tennis star Li Na, was the first Chinese player to claim a grand slam singles title, and her success has bolstered the sport's popularity back home in recent years. Both players were among the handful of pioneers to break from the country's state-sponsored teams to take greater control of their futures. This week Patricia Huang writes about China's newfound entrepreneurial spirit.

2014-09-05 A Letter to My Grandson About Entering the Working Life by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, shares a letter he wrote to his 21-year-old grandson, who is entering his final year in college. "I then realized that some of this advice might also come in handy to several of my younger clients those who belong to the third generation of the families whose fortunes I manage on three continents."

2014-09-04 Developed Europe: Regional Economic Review - Q2 2014 by Team of Thomas White International

Europes ability to sustain its economic recovery is back in the spotlight. The latest second quarter estimates of statistics agency Eurostat, which were released in mid-August, show that compared to the first quarter, GDP merely inched up 0.2 percent in the 28-country European Union (EU) but failed to grow at all in the 18-member Euro-zone.

2014-09-04 International Equity Commentary: July, 2014 by Team of Thomas White International

International equity prices saw a modest correction in July as geopolitical tensions worsened in Ukraine and the Middle East. The risk of these conflicts spreading to wider areas and pulling in more countries unnerved the markets.

2014-09-04 Emerging Markets Equity Commentary: July, 2014 by Team of Thomas White International

Emerging market equity prices continued to outperform the developed markets in July and ended the month with moderate gains. Markets in Asia significantly outperformed during the month, helped by signs of stabilizing economic growth in major markets such as China.

2014-09-04 Could a China Recession Cause $50/barrel Crude Oil? by William Smead of Smead Capital Management

Globalization has created an interconnection between major world economies and commodity prices. China, as the world's most populous country, rearranged the commodity landscape by growing their economy at double-digit compounded rates from 2000-2010. By doubling their use of oil, copper and other major commodities, China created a golden era for commodity investors and everyone involved in oil exploration and production.

2014-09-04 Midterms May Mean More Gains for Stocks by Burt White, Jeffrey Buchbinder of LPL Financial

With the midterm elections now just two months away and campaigning starting to heat up, we thought we would share our current views on the political landscape and what it may mean for U.S equities. In our two Outlook 2014 publications for this year, we posited that the U.S. economy and corporate profits may drive the stock market higher and investors could turn their attention away from policymakers in Washington, who were such a distraction in 2013 and earlier in the current economic expansion.

2014-09-04 Central Banks Pump Up the Volume by Scott Minerd of Guggenheim Partners

Aggressive central bank accommodation from Europe to Japan and a dovish Federal Reserve bode well for equities and bond prices.

2014-09-04 What's Next for the Dollar and Gold? by Axel Merk of Merk Investments

One reason markets tend to get a little nervous in September is that its time for investors to ponder about their asset allocation for the remainder of the year and beyond. With the markets at or near record highs and the US dollar on a roll, what could possibly go wrong? Lets look at whats next for the dollar, gold, and currencies.

2014-09-04 Global: Recovery Continues, but Headwinds Persist by Keith Wade of Schroders Investment Management

Keith Wade, Chief Economist at Schroders, discusses why Schroders has trimmed global growth projections for 2014 and 2015.

2014-09-04 Congress Will Go Out With a Whimper, But the Next Could Come In With a Roar by Libby Cantrill of PIMCO

A government shutdown is highly unlikely this year, and most need-to-pass bills will likely pass either before the election or during the "lame duck" session of Congress. Should Republicans take the Senate, we should expect heightened policy uncertainty around issues such as the debt ceiling increase in 2015.

2014-09-04 U.S. Oil Industry, Economy Feel Effects of Shale Revolution by David Ginther of Ivy Investment Management Company

The term Shale Revolution reflects the booming oil production from shale basins in the U.S. The rapid pace of oil output from these fields is spurring growth across the energy industry, providing a wide range of benefits to the U.S. economy and generating potential opportunities for investors.

2014-09-04 Risk Revisited by Howard Marks of Oaktree Capital

In April I had good results with Dare to Be Great II, starting from the base established in an earlier memo (Dare to Be Great, September 2006) and adding new thoughts that had occurred to me in the intervening years. Also in 2006 I wrote Risk, my first memo devoted entirely to this key subject. My thinking continued to develop, causing me to dedicate three chapters to risk among the twenty in my book The Most Important Thing. This memo adds to what Ive previously written on the topic.

2014-09-03 Consumer Confidence Hits a Seven-Year High... But by Gary Halbert of Halbert Wealth Management

Last week, the Conference Board reported that its Consumer Confidence Index rose to a near seven-year high in mid-August. It was the fourth consecutive monthly rise in the Index and handily beat the pre-report consensus.

2014-09-03 Voya Fixed Income Perspectives August 2014 by Christine Hurtsellers, Matt Toms of Voya Investment Management

Like the buzz of the alarm clock on the first day of school, the July/early August market selloff awoke investors to the fact that the lazy, carefree days cant last forever. Though a single catalyst for the latest shift in sentiment is tough to identify, there are a number of suspects: ample geopolitical uncertainty, the possibility that strong U.S. economic data may hasten fed funds rate normalization and Fed rhetoric about froth in certain markets.

2014-09-03 S&P Hits the 2,000 Mark by Ryan Davis of Fortigent

Equity markets moved modestly higher last week, with the S&P 500 closing above the 2,000 level for the first time. The S&P 500 added 80 bps on the week and now stands up 9.9% on the year following a 4% gain in August. Bonds also rallied last week, rising in tandem with European sovereigns. The rate on the 10-year Treasury fell to 2.33% by weeks end.

2014-09-03 Despite Growing Risks it's Still Janet Yellen's Market by John Browne of Euro Pacific Capital

The current stock market is earning a deserved reputation as being coated in Teflon. Bad or disappointing news just doesn't appear to stick, and has done nothing to slow the market's upward trajectory. Bad news is good and good news is good news. But where does this all end? A minority of investors have begun to wonder whether negative geo-political risks, embodied in the steely-eyed stare of Vladimir Putin, are exerting more influence on the market than the sunny smiles of Janet Yellen.

2014-09-03 State and Local Governments Outpace the Feds by Milton Ezrati of Lord Abbett

The fiscal health of state and local governments appears robust when compared with that of the federal government.

2014-09-03 The Peritus Process Managing Risk by Tim Gramatovich of AdvisorShares

What is risk and how is it defined? To us, risk is about losing money and managing risk is what portfolio management is all about. Lets begin with credit risk, which is something we take on and expect to get paid for. First of all, credit investing is a negative art. What you dont buy is more important than what you do buy. Investors will not appreciate this until the cycle turns, which will inevitably happen at some point.

2014-09-03 For Wonks Only??? by William Gross of PIMCO

A credit-based financial economy (as opposed to pure cash) depends on an ever-expanding outstanding level of credit for its survival. Without additional credit, interest on previously issued liabilities cannot be paid absent the sale of existing assets, which in turn would lead to a vicious cycle of debt deflation, recession and ultimately depression.

2014-09-03 International Developed and Emerging Markets by Riad Younes of R Squared Capital Management

This commentary explores what the author believes to be the best opportunities in international investing along with challenges facing investors in developed and emerging markets.

2014-09-03 All Eyes on the ECB as Europes Recovery Remains Fragile by Matthew Dennis of Invesco Blog

While the European Central Bank (ECB) has successfully eased financial market stress over the past two-plus years, Europes long-awaited recovery still remains fragile and imbalanced.

2014-09-02 Why Individual Stock Selection Matters in Today's Environment by Bill Hench (Article)

No matter how expensive the market might be at any given time, there will always be stocks that look inexpensive to us on an absolute basis. Portfolio Manager Bill Hench discusses how he's been handling current valuations and what he's been seeing in the way of M&A activity with Principal Dave Gruber.

2014-09-02 Ranking the Top 10 "Differentiators" for Advisory Firms by Bob Veres (Article)

If we have a clear idea of what foregrounds one advisory firm ahead of others, then we can deliberately cultivate those characteristics. The problem is, nobody has ever compiled a comprehensive list of differentiators, much less ranked them according to importance. So, to fill that obvious void, I've ranked the top 10 differentiators that I've personally seen advisors use in their positioning and marketing.

2014-09-02 Can Retirees Still Use a 4% Withdrawal Rate? Practical Applications of Monte Carlo Analysis by Wade Pfau and David Blanchett (Article)

Some advisors remain critical of Monte Carlo simulations, instead preferring to use analysis based on rolling historical periods or specific pre-defined scenarios. We believe Monte Carlo is a superior tool for measuring the uncertainties in long-term financial planning. As an example, we use it to predict the likelihood of a successful 4% withdrawal rate under today's market conditions.

2014-09-02 How to Raise Sensitive Issues with Clients by Dan Richards (Article)

Important issues - so-called elephants in the room - threaten the financial futures of clients and their families. Clients and advisors normally recognize these issues, but because they are emotionally charged, they are difficult to discuss. Here are three steps to talk about these subjects.

2014-09-02 Use Your Fingerprints to Gather More AUM by Daniel Solin (Article)

A colleague of mine calls it "assumicide" - trying to convince a prospect to say yes by offering a careful and exhaustive presentation of a proposal's assumptions and merits. There's a more powerful route to yes, however: using heuristics to align yourself with your prospect.

2014-09-02 A Marketing Strategy to Reach Millennials by Melanie Cressman (Article)

Millennials are a hands-on generation in every aspect, including finances. How can financial advisors connect with them?

2014-09-02 Helping Clients Redefine Retirement by Beverly Flaxington (Article)

Sometimes I fear my clients do not know what retirement will look like to them and so planning for it, financially or otherwise, is challenging. It's why I believe they need an advisor, but I want to be sure I am doing the best I can for them in these discussions.

2014-09-02 Your Clients Don't Care About You by Megan Elliott (Article)

Conversations with clients should be about them, not you.

2014-09-02 The Exaggerated Death of Inflation by Kenneth Rogoff of Project Syndicate

Modern central banking has worked wonders to bring down inflation. Ultimately, however, a central banks anti-inflation policies can work only within the context of a macroeconomic and political framework that is consistent with price stability.

2014-09-02 Late, Not Lost: The Economic Drag From the Millennial Generation by Joshua Anderson, Emmanuel Sharef, Jason Mandinach of PIMCO

We believe concerns of a student debt "bubble" and perpetual financial weakness among Millennials are largely overstated. Understanding Millennials' financial trajectory is critical to our secular (3-5 year) outlook for home prices and the broader economy. We expect Millennials' financial position to improve, and pent-up demand could result in longer-term strength in housing and housing-related assets.

2014-09-02 US Home Prices Rise In July by Team of GaveKal Capital

CoreLogic released their home price index for July today and it showed another 1.25% month-over-month gain in June (including distressed sales). Their index is 7.4% higher than one year ago.

2014-09-02 Banking on BRICS by Mark Mobius of Franklin Templeton Investments

In July, leaders of the five emerging market countries known as the BRICS (Brazil, Russia, India, China and South Africa) met in the Brazilian city of Fortaleza and announced the creation of a New Development Bank (NDB).

2014-09-02 Chinas Reforms Open New Path to Equities by Stuart Rae, John Lin of AllianceBernstein

For investors in China equities, there have traditionally been two ways of approaching the market: through expensive growth stocks, or risky contrarian plays. Now, thanks to Chinas reforms, theres a third way which may offer a better balance of risk and return.

2014-09-02 Stronger Growth Should Push Equities Higher by Robert Doll of Nuveen Asset Management

A rash of positive news propelled stock prices higher for the fourth consecutive week, marking the longest winning streak for equities since last November. The S&P 500 Index pushed above the 2,000 level for the first time as it gained 0.8% for the week.

2014-09-02 Is the Stock Market Cheap? by Doug Short of Advisor Perspectives (

Here is a new update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly averages of daily closes for the past month, which is 1,961.53. The ratios in parentheses use the monthly close of 2003.37. For the earnings, see the table below created from Standard & Poor's latest earnings spreadsheet.

2014-09-01 A Labor Day Perspective: The Growth of our Services Economy by Doug Short (Article)

In honor of Labor Day, which was signed into law as a national holiday in 1894, I'd like to share some graphical snapshots of a major change in our nation's workforce over the decades.

The Department of Labor's Bureau of Labor Statistics has monthly data on employment by industry categories reaching back to 1939. The first chart below is an overlay of the compete series of employment numbers for the two major categories, manufacturing and services industries.

2014-09-01 Growth by John Mauldin of Mauldin Economics

This week I will respond to the second part of David Brins letter. Please note that David and I characterize our conversations as joyous deliberations, excited parry and thrust in the realm of ideas. I especially appreciate David because he forces me to think about many of my casual assumptions, although in a battle of wits with David I often feel as if Im bringing a knife to a gunfight. (Every writer needs a few David Brins in his life. Sometimes I think I have more than my share.)

2014-09-01 Democracy in the Twenty-First Century by Joseph Stiglitz of Project Syndicate

The economist Thomas Pikettys forecast of still higher levels of inequality does not reflect the inexorable laws of economics. Indeed, the main question today is not really about capital in the twenty-first century; it is about democracy in the twenty-first century.

2014-08-31 Abenomics, European Style by Nouriel Roubini of Project Syndicate

Two years ago, Shinzo Abes election as Japans prime minister led to the advent of Abenomics, a three-part plan to rescue the economy from a treadmill of stagnation and deflation. It now appears that the European Central Bank has a similar plan in store for the eurozone.

2014-08-30 Anticipate Before You Participate: Patterns in Trading by Frank Holmes of U.S. Global Investors

The primary unit of time measurement for high-frequency traders might be the microsecond, but for normal retail traders, it?s vital to know the best months, days and even half-hours of the day to make market transactions.

2014-08-30 Sound Familiar? by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

Stocks seem likely to continue their upward momentum although volatility could increase with Federal Reserve interest rate uncertainty combined with midterm elections and geopolitics. An improving economy, decent valuations and a still-accommodative Fed leave us confident that dips should be viewed as buying opportunities. Conversely, Europe is looking worse and we would be cautious in adding new cash at this time, concentrating additional international exposure instead on China and to a lesser degree Japan, always with a diversified portfolio in mind.

2014-08-29 Bond Yields Around a First Rate Hike by Anthony Valeri of LPL Financial

Historically, bond yields have begun to move more forcefully four to six months ahead of a first rate hike from the Fed. We believe the rise in interest rates may begin sooner this cycle due to lower yields and more expensive valuations. We favor capitalizing on year-to-date bond strength and recommend a defensive posture consisting of short to intermediate bonds.

2014-08-29 The Long-Term Value of Active Management in the Small-Cap Space by Chuck Royce of The Royce Funds

As the ongoing debate about the effectiveness of active management, especially since the proliferation of ETFs and index funds, continues unresolved, it is difficult for us not to be biased. Our focus, however, remains solely on long-term outperformance and the interests of our shareholders, and we believe the best way of accomplishing this is through careful stock selection and having an absolute standard.

2014-08-29 The Modern Day Widow Maker Trade is to Short Treasuries by Team of GaveKal Capital

As treasury yields plunge again today to new 1-year lows (the 10 and 30-year treasury bond yields are both down 3bps to 2.33% and 3.07%, respectively), we are reminded of a popular trade over the last decade to short Japanese government bonds, which has aptly been named the "widow maker" trade.

2014-08-29 Three Investing Lessons from the Napa Earthquake by Russ Koesterich of BlackRock

Last weeks Bay Area earthquake was a stark reminder that there are risks to living in California. It also was a violent, but good, metaphor for the dangers lurking in financial markets. Russ shares three investing lessons and one busted movie myth that he took away from the Napa earthquake.

2014-08-29 Lucara Diamond Stock Sparkles, Reports Another Strong Quarter by Frank Holmes of U.S. Global Investors

Often it seems that gold gets all the fun when I write and speak about precious metals and minerals. But Vancouver-based Lucara Diamond has been turning heads here at U.S. Global Investors lately for a number of reasons, the most notable being that it continues to report stellar returns.

2014-08-29 Why 2K? by Robert Isbitts of Sungarden Investment Research

This week, the S&P 500 stock index crossed the 2,000 mark for the first time (this figure and other historical returns referred to in this article do not include dividends). Round numbers always get the medias attention, so avid market-watchers already know this. But why? Why, just six years after the financial world seemed to be ending, are we celebrating a milestone that at that point seemed a generation away?

2014-08-29 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Flexible labor markets are key to recovering from recession; Wage trends present a challenge for the Fed; Bank settlements are sizeable, but the benefit to housing has been limited

2014-08-28 Data Dilemma: When Final Isn't Final by John Canally of LPL Financial

Revisions to GDP dont often change the overall picture of the health, or lack thereof, of the economy. Despite cutbacks to congressional funding of data collection at the federal level in recent years, the GDP data are a lot more accurate than they used to be. About every five years, the BEA does a comprehensive revision to GDP, and at that point, GDP for any specific quarter is just about as final as it will get, as the BEA has 98% of the data it needs to calculate GDP.

2014-08-28 I Cant Save Europe Alone Mario Draghi at Jackson Hole by Bob Andres of Andres Capital Management

Janet Yellen began her prepared speech on monetary policy and the labor markets in Jackson Hole at 10:00am on Friday. Within minutes, analysts were offering insights into future interest rate policy. The equity markets dipped slightly only to recover quickly to pre-speech levels. The consensus view, which emerged after sifting through the release, was that Ms. Yellens view on interest rates may be a tad less dovish than previously expressed. With no video feeds emanating from the conference and with tepid market reaction, we asked ourselves, Is she whispering or is she Yellen?&rd

2014-08-28 Frustrations of a Frugal Investor by Kendall Anderson of Anderson Griggs

The other day I was leaving the office and a gentlemen who has known me for quite some time asked about the model year of my truck. I told him it was a 2001 and that it should still be good for another 100,000 miles. Of course my truck is known to me and many of my friends as Big Red, and it has become a family member of sorts, capable of and willing to take on any job, rather than just a truck that hauls things around.

2014-08-28 Washington Recaptured by Simon Johnson of Project Syndicate

Two hundred years ago, Washington DC was captured by the British who then set fire to official buildings, including the White House, Treasury Department, and Congress. Today, it is a domestic interest group very large banks that has captured Washington, and the costs are likely to be far higher than they were in 1814.

2014-08-28 The World is in Crisis…the Markets Are Not by Zachary Karabell of Envestnet

Markets have been gyrating for the past months in the face of a wave of geopolitical crises. But the chance of any of these crises dramatically altering the behavior of markets beyond the short-term is very, very slight.

2014-08-28 Brazil: A Ripe Market for Bottom-Up Stock Pickers by Jim Harvey, Dilip Badlani of The Royce Funds

Royce International Micro-Cap Fund Portfolio Managers Jim Harvey and Dilip Badlani talk about their recent trip to Brazil, the country's current challenges, the importance of careful stock selection, what insider ownership reveals, Brazil's real estate market, learning from experience, looking for competitive advantages and the importance of corporate governance, and where they've been finding opportunities.

2014-08-28 Market Internals—Breadth Weakness Troubling But Not Dire by Doug Ramsey of Leuthold Weeden Capital Management

Last month we argued "stock market participation is too broad for an imminent cyclical top to form," and we're not retreating from that statement. But interim market tops of varying degrees of importance can form with little or no warning. We've characterized stock market action alternately as uniform or in gear throughout most of 2014, but it's clear that market participation has not been nearly as "egalitarian" as it was throughout 2013. We've marveled at how well measures of market breadth were able to shrug off Small Caps' dramatic relative strength breakdown.

2014-08-27 EM Growth Provides Tailwind for Automation Companies by Nick Niziolek, Paul Ryndak of Calamos Investments

The pullback in Japanese equities earlier this year brought the valuations of select automation companies to attractive levels that do not fully reflect the long-term growth potential we see. The days of Henry Ford's assembly line are long gone, replaced by automated conveyor systems and robots that do much of the heavy lifting. Chinese labor costs are rising quickly, providing incentive for manufacturers to be more productive and contain costs. Also, the technical and quality requirements for manufacturing cars, phones and other electronics is increasing, requiring more precision.

2014-08-27 The Demise of Active Management is Greatly Exaggerated by William Smead of Smead Capital Management

Financial advisors and registered investment advisors feel severe pressure to throw in the towel on manager selection methodologies and accept index returns. Yet, many of these stories forget one central concept: indexes are actually inexpensive actively-managed portfolios. Every actively managed fund is an index itself.

2014-08-27 From the Alps to the Tetons by Brian Andrew of Cleary Gull

Central bankers seem to be the focus once again. If the global economy were strong enough to stand on its own, we wouldnt spend every waking moment worrying about what Fed Reserve Chair Janet Yellen and her European Central Bank counterpart Mario Draghi are going to do next. The fact that these bankers are front and center again in investors minds, is a function of both how sluggish the global economy is and how persistent the hangover from the mid-2000s real estate party continues to be.

2014-08-27 The Price is Right - The S&P 500 Index Deconstructed by Edward Talisse of Chelsea Global Advisors

Is the widely followed S&P 500 equity index wildly overvalued at its current price of 2,000? Well, that depends upon your assumptions about earnings and dividend growth and your risk adjusted required rate of return.

2014-08-27 Fed's Getting Anxious About Interest Rate "Liftoff" by Gary Halbert of Halbert Wealth Management

While I have been a Fed watcher for over 30 years, rarely have I seen as much media angst over the central banks next move as we are seeing today. We all know that the Fed is going to raise short-term interest rates at some point. We expect the Fed to normalize interest rates slowly in measured steps over the next few years. The main question is, when does this process begin?

2014-08-27 Gold: Keeping Calm And Carrying On by Ade Odunsi of AdvisorShares

We continue from last weeks discussion on the role of interest rates in the gold market by looking at trends in the cost of carry of gold as priced in dollars, euro, yen and pounds. By way of a brief primer we define the cost of carry of gold in dollars as the London Bullion Markets Association 3 month Gold Forward Offered Rate (GOFO). GOFO is published every day by the LBMA and is calculated as US dollar Libor minus the gold lease rate.

2014-08-27 The Stall-Speed Syndrome by Stephen Roach of Project Syndicate

As tempting as it may be to attribute developed economies' latest growth slowdown to idiosyncratic factors, weakening performance in the US, Europe, and Japan is not so easily dismissed. In all of these cases, the post-recession rebound has not been nearly large enough to alter the sluggish underlying trend.

2014-08-27 Gold Jewelry Demand in India Improves by Frank Holmes of U.S. Global Investors

Those who root for gold root for India. Despite a welcome June rally, its been a rocky second quarter for the worlds second-largest consumer of the metal, with demand down 18 percent compared to last year.

2014-08-26 BDCs featuring John Cole Scott by (Article)

Business Development Companies, a CEF "cousin," are gaining attention from yield-seeking investors, says John Cole Scott of CEF Advisors.

2014-08-26 2014's Market So Far by Chris Clark and Chuck Royce (Article)

During the March 4, 2014 interim high for small-caps into the middle of May, the Russell 2000 declined roughly 9.1%. Chief Executive Officer Chuck Royce talks with President Chris Clark about what he saw during this period and how this correction affected the performance of The Royce Funds.

2014-08-26 The Power and Limitations of Monte Carlo Simulations by David Blanchett and Wade Pfau (Article)

Explaining the past is much easier than predicting the future. This uncertainty raises a significant number of issues when creating a financial plan for a client. Monte Carlo simulations will illuminate the nature of that uncertainty, but only if advisors understand how it should be applied - and its limitations.

2014-08-26 Feedback That Motivates Your Team by Dan Richards (Article)

Last week's article outlined new research into how to motivate your team. One of the best strategies is giving consistent, quality feedback. Here are nine ways to provide feedback that motivates your team.

2014-08-26 The Ticking Time Bomb Stressing Your Success by Daniel Solin (Article)

Here's some insight on how stress reduces your ability to work effectively - and what to do about it.

2014-08-26 Why Germany's Economy is So Strong by Marianne Brunet (Article)

After spending more than a month this summer living in a rural part of Eastern Germany, I discovered that the source of Germany's economic strength extends far beyond the fields at the World Cup.

2014-08-26 Successful Succession Planning - Building Your Legacy and Keeping It by Alan Rosenfield (Article)

RIAs need a succession plan. But what does that mean, and how can you get one?

2014-08-26 Advisors Dealing with Illness in Their Family by Beverly Flaxington (Article)

My only brother is dying of cancer, my parents have both moved into nursing homes and we have a sick son who is in need of care. Given the number of advisors in my age category, I am maintaining my business but I can't focus on growth. Any suggestions on how to find resources to help me?

2014-08-26 These Four Mistakes Will Shipwreck Your Email Marketing Campaign by Alan Del Rosario (Article)

Here are four common mistakes that will shipwreck your email marketing campaign.

2014-08-26 Global Economic Overview: July 2014 by Team of Thomas White International

Recent economic data from the developed world have shown divergent trends while growth in the emerging economies appears to be stabilizing. The U.S. economy expanded at a faster than expected pace during the second quarter, more than offsetting the first quarter decline, which revised estimates show was not as severe as thought earlier.

2014-08-26 Event Driven Managers Encounter a Short-Term Hiccup by Chris Maxey, Brian Payne of Fortigent

After a period of very strong deal activity during the first half of 2014, traders and investors were hit with arbageddon in early August. Arbageddon struck after a series of large deals fell apart, sparking concern that the pickup in activity from earlier in the year was coming to an abrupt halt. Activity since that time would suggest otherwise, and it appears that the M&A train is back on course.

2014-08-26 Markets Want a Date, Fed Wants More Data by Kristina Hooper of Allianz Global Investors

Instead of getting clarity about when rate hikes will happen, investors are finding an increasingly divided Fed doing careful analysis and making nuanced arguments, writes Kristina Hooper.

2014-08-26 A Nation of Shopkeepers by John Mauldin of Mauldin Economics

One of the great pleasures of writing this letter is the fascinating correspondence and the relationships that develop along the way. The internet has allowed me to meet a wide range of people all over the world something that never happened to me pre-1999. Not only do I get to meet a wide variety of people, I also come into contact with an even wider range of knowledge and ideas, much of which comes my way from readers who send me work they think Ill have an interest in. I have a bountiful, never-ending source of thoughtful material, thanks to you.

2014-08-26 How Do You Anticipate the Unexpected? by Jerry Wagner of Flexible Plan Investments

It always seems to begin the same. A News Flash scrolls across the lower portion of our TV screens. Or the music trumpets a change is coming on the radio. (For those always plugged in on their phones or iPods, though, I have no idea how they learn about anything!)

2014-08-26 Yellen at Jackson Hole by Zach Pandl of Columbia Management

I must have heard it on the radio recently, because Janet Yellens speech at this years Jackson Hole conference brought to mind lyrics from one of my favorite Beatles songs.

2014-08-26 Republic or Empire? An Update, Part 2 by Bill O'Grady of Confluence Investment Management

Over the past two years, how American society answers this question is becoming increasingly critical. There is a steady undercurrent in American politics that seeks to withdraw the U.S. from world affairs. Last week, we introduced this topic. This week, we will conclude our analysis, including market ramifications. This report will detail the costs to the U.S. for taking on the superpower role.

2014-08-26 International Opportunities - a look at the bigger picture by Stephen Peak (Article)

Stephen Peak takes a look at the bigger picture and provides commentary on the world as we see it. He discusses expectations of rising interest rates and notes that geopolitical tensions in Europe and the Middle East are causing uncertainty and hesitation among investors. Stephen believes we are in a process of change and that clients should consider their international allocations, and at the margin, increase them subject to the needs of individual clients.

2014-08-25 Equities Climb as Investors Focus on Fundamentals by Robert Doll of Nuveen Asset Management

Equities have recovered all of the losses experienced in July through early August. The Fed appears to be slowly paving the way for interest rate increases, but were not expecting any immediate changes. The global economy is growing, but remains weak. In this environment, we believe investors should be more selective.

2014-08-25 Broken Links: Fed Policy and the Growing Gap Betweeen Wall Street and Main Street by John Hussman of Hussman Funds

The issue is not whether the U.S. economy does or does not need life support. The issue is that QE is not life support in the first place. How can policy makers help to build the economy from the middle-out, and slow the both the unproductive diversion and the lopsided distribution of resources in our economic system? We should begin by stopping the harm.

2014-08-25 Consumer Spending & Economic Recoveries: What They Mean Going Forward by Matt Lloyd of Advisors Asset Management

As a follow-up to the discussion on the rollover of the duration of the unemployed, the byproduct of an accelerating improvement in the undercurrents of the job market is consumer spending. The measure of consumption has a primary correlation to wages and income workers receive. As such, the benign improvement in wages has an obvious correlation to the benign improvement in consumption. There is a strong secondary driver which we will discuss shortly.

2014-08-25 Catching Up On Performance by Team of GaveKal Capital

It's time for our weekly ritual of looking back before we look too far forward. Where has it paid to be invested and where has it not? Let's start with the Developed Markets.

2014-08-25 Active or Passive? How to Blend Aspects of Both by Russ Koesterich of BlackRock

While the official debate between active and passive investing strategies will never truly be settled, Russ advocates embracing a simple approach that blends aspects of both, and he provides five criteria to consider as youre figuring out the right mix for you.

2014-08-25 New US Bank Rules a Boon for Bond Investors by Jeff Skoglund, Shrut Vakil of AllianceBernstein

US banks have come a long way since the financial crisis, and thats good news for fixed-income investors. We think better fundamentals and stricter regulations are creating a good formula for banks preferred securities.

2014-08-25 Correcting a Common Misconception about Alternative Investments by Walter Davis of Invesco Blog

A common misconception about alternative investments is that these investments have failed anytime they underperform the stock market. Investors need to know that alternative investments are designed to achieve returns that are more consistent and less volatile than those of the stock market on a long-term basis across multiple market cycles.

2014-08-25 Median Household Income Since the Great Recessio