More on Related Themes
2015-10-05 00:00:00 An All-Market Approach to Investing in China by William Yuen of Invesco Blog
As China transitions from a manufacturing-driven economy to a consumer-led one, the Chinese investment universe has expanded. Historically, global investors have chosen to invest in Chinese equities via Hong Kong stock exchanges. But with China gradually opening its capital markets to global investors, and more Chinese enterprises successfully listing overseas, the investment options and opportunities have increased significantly. In this changing investment landscape, we are seeing a growing trend toward investors adopting an all-market approach to investing in China.
2015-10-05 00:00:00 Green Shoots in China? by Nick Niziolek of Calamos Investments
Over the next weeks, there will be a great deal more data for us to evaluate, including foreign reserves data on October 6. Signs of stabilization in foreign reserves and savings deposits would point to a reduced risk of capital flight, which would give us more confidence in a gradual depreciation of the renminbi. We’ll also be watching for mid-month data on imports. If these green shoots begin to take hold and the markets can become comfortable that a hard landing is off the table for the near term, we wouldn’t rule out a fourth quarter rally in Chinese and global equity markets.
2015-10-03 00:00:00 The 10 Most Competitive Countries in the World by Frank Holmes of U.S. Global Investors
No new countries have entered or exited this exalted list, and there was very little rank-shuffling. For the seventh consecutive year, Switzerland is the most competitive country. For the fifth straight year, Singapore is number two. The U.S. comes in at number three for the second year. And so on.
2015-10-03 00:00:00 The U.S. Starts a Challenging Fiscal Year by Carl Tannenbaum of Northern Trust
The budget battles that rage at this point on the calendar illustrate the myopia and dysfunction of the American legislative process.
2015-10-02 00:00:00 World CPI Proxy Breaks Below 1% by Eric Bush of GaveKal Capital
There’s been a lot of of deflationary data recently (see here, here and here). The plunge in our simple World CPI proxy to the lowest level since October 2009 doesn’t really catch us off guard. The fact that one third of the 33 countries in our proxy are currently are seeing year-over-year declines in consumer prices is a bit eye-opening, however. Switzerland is leading the deflationary wave as Swiss consumer prices are down -1.4% year-over-year, more than they were at any point during the financial crisis. The year-over-year decline is the largest on record since 1959 for Switzerland.
2015-10-02 00:00:00 Postcard from Huallywood by Sharat Shroff of Matthews Asia
First came Hollywood, then India’s Bollywood. Now, China’s Jiangsu province is hoping Huallywood will be the next film production site to make international waves. As a prime example of the China’s steady migration toward services-led growth, Wuxi studios—developed on the site of a former iron and steel factory—is trying to attract college students and independent artists.
2015-10-02 00:00:00 The Trans-Pacific Free-Trade Charade by Joseph Stiglitz of Project Syndicate
As negotiators and ministers from the US and 11 other Pacific Rim countries meet in Atlanta in an effort to finalize the details of the sweeping new Trans-Pacific Partnership, some sober analysis is warranted. The biggest regional trade and investment agreement in history is not what it seems.
2015-10-01 00:00:00 A Fragile Transition Supported by (Further) Policy Accommodation by Adam Bowe, Isaac Meng, Tadashi Kakuchi of PIMCO
n the following interview, Portfolio Managers Adam Bowe, Isaac Meng and Tadashi Kakuchi discuss conclusions from PIMCO’s quarterly Cyclical Forum, in which the company’s investment professionals debated the outlook for global economies and markets. They share our views on economies and investment implications across the Asia-Pacific region over the next 12 months.
2015-09-30 00:00:00 El Niño Update by Kaisa Stucke of Confluence Investment Management
Meteorologists have been calling for an El Niño event since last year. Current forecasts place the likelihood of an El Niño this winter at over 90%. Water temperatures in the Pacific, one of the first signs of a looming El Niño, have measured much higher than normal. In fact, water temperatures have been on par with the most severe El Niño event from the past 30 years. This report looks at how an El Niño develops and its possible climate, economic and geopolitical effects on the global economy. As always, we outline the potential investment implications of this event.
2015-09-28 00:00:00 Staley Cates on Why Active Management Wins in the Long Term by Robert Huebscher (Article)
Staley Cates is president and chief investment officer of Southeastern Asset Management, manager of the Longleaf funds. In this interview, he says, “the passive movement is not just a big trend. It is a bubble.” He explains why passive investing has made it hard for value investors to outperform.
2015-09-25 00:00:00 How NOT to Wipe Out with Momentum by Chris Brightman, Vitali Kalesnik, Engin Kose of Research Affiliates
Enabled by modern technology, investors can now enhance a pure value strategy by using momentum to improve timing, measuring quality to avoid value traps, and diversifying active bets into less efficiently priced small stocks.
2015-09-25 00:00:00 Visit to Cradle of Innovation and Entrepreneurship by Rahul Gupta of Matthews Asia
There is a lot of optimism around Indian Prime Minister Narendra Modi’s visit to the San Francisco Bay Area, and rightly so. India is expected to add more than 100 million employable workforce to the global labor pool in the next decade. The country needs to find many engines of growth to provide employment opportunities to its population. Mr. Modi understands this very well—hence his slogan “Make in India.” The Prime Minister shown his acumen in understanding productivity the technology industry can unleash, and his upcoming visit to Silicon Valley’s cradle of innovation and entrepr
2015-09-25 00:00:00 How Will These Leaders of 4 Billion People Change the World? by Frank Holmes of U.S. Global Investors
This week the U.S. played host to three prominent and illustrious leaders to billions of people: Chinese President Xi Jinping, Indian Prime Minister Narendra Modi and Pope Francis. Among them, they lead—either politically or spiritually—nearly 4 billion people worldwide, more than half of everyone living on the planet right now.
2015-09-25 00:00:00 The Case for Credit by Mark Kiesel of PIMCO
Three reasons why the outlook for developed credit markets remains constructive.
2015-09-25 00:00:00 China, Commodities, and Crisis: What’s Next for Emerging Markets by Zachary Karabell of Envestnet
China’s growth story fueled global markets for years, and the recent market rout raises concerns that the spigot may be tapping out. But is it really? Emerging markets, currently out of favor with investors, are showing signs of domestic economic growth driven by an expanding middle class. Could these economies, along with China, re-emerge as bright spots in the global markets?
2015-09-23 00:00:00 On The Fed, Deflation, Government Shutdown & The Moon by Gary Halbert of Halbert Wealth Management
Once again this week, we touch on a variety of topics that piqued my interest over the last week. We begin with some further analysis of the Fed’s controversial decision to hold interest rates near zero last Thursday.
2015-09-23 00:00:00 Balancing Risks and Opportunities in the Multi-Speed World by Richard Clarida, Andrew Balls of PIMCO
Read our global economic outlook for the near term and implications for asset classes.
2015-09-19 00:00:00 Here Are Two Ways Investors Can Take Advantage of the Fed's Uncertainty by Frank Holmes of U.S. Global Investors
Although interest rates could still be hiked in one of the two remaining times the Federal Open Market Committee (FOMC) meets this year, I’m inclined to think they’ll stay near zero until at least 2016. The decision is a welcome one for both gold demand and new home purchases. When rates rise, gold becomes less attractive for some investors, who are encouraged to exchange their no-yielding gold for income-producing assets.
2015-09-18 00:00:00 Are “Chinese Whispers” Distorting Your View? by Stuart Rae, John Lin, Hayden Briscoe, Anthony Chan of AllianceBernstein
Renewed anxiety about China’s economic performance appears to be at odds with the fact that the country’s growth has been declining for years. How much of the recent nervousness is based on an outdated view of China’s policy direction?
2015-09-18 00:00:00 Japan Then and Now by Kenichi Amaki of Matthews Asia
Late in 2006, Matthews Asia was wrapping up a special report titled “Japan Reawakens.” The timing of that AsiaNow publication, just ahead of the Global Financial Crisis, was unfortunate to say the least. With the ensuing economic turmoil, Japan fell asleep again, sliding off the radar screens of many investors. But as interest in Japan has more recently re-emerged, I thought it would be important for us to take a look back and consider what we previously published. Has Japan evolved the way we had envisioned? What’s changed and what hasn’t?
2015-09-18 00:00:00 The Fed Holds by Carl Tannenbaum of Northern Trust
The Federal Open Market Committee (FOMC) concluded its meeting today with no change in interest rates.
2015-09-17 00:00:00 More Volatility on U.S. Horizon Has Sights Turning to Asia by Russ Koesterich of BlackRock
After weeks of struggling, global equities stabilized last week. In the U.S., the S&P 500 Index rose 2.08% to 1,961, the Dow Jones Industrial Average climbed 2.05% to 16,433, and the tech-heavy Nasdaq Composite Index advanced an even stronger 2.97% to end the week at 4,822. Meanwhile, the yield on the 10-year Treasury rose from 2.13% to 2.19%, as its price correspondingly fell.
2015-09-17 00:00:00 Economic Surprises Are Turning Back Over In The US by Eric Bush of GaveKal Capital
The Citi Economic Surprise Index for the US is at two-month low and squarely back in negative territory. The US has spent almost the entire year not meeting expectations.
2015-09-16 00:00:00 Correlations Have Spiked In The US, Less So Around The World by Eric Bush of GaveKal Capital
The correlation between US stocks and the MSCI World Index has once again spiked as volatility has increased. In the chart below, we show 20-day, 65-day, and 200-day rolling correlation between US stocks and the MSCI World Index. The 20-day correlation has increased to 0.82 which is the highest level since 9/7/2011 and it surpasses any level hit during the financial crisis.
2015-09-16 00:00:00 New Study: We're Nowhere Near Peak Coal Use in China and India by Frank Holmes of U.S. Global Investors
Resource investors, take note: By 2025, just 10 years from now, energy consumption in Asia will increase a whopping 31 percent. A whole two-thirds of that demand, driven largely by China and India, will be for fossil fuels, most notably coal.
2015-09-16 00:00:00 Don’t Submit to Market Distortions by Sharon Fay of AllianceBernstein
After years of steadily rising markets, distortions have become embedded in the landscape. We believe there are several large market imbalances that investors may be exposed to in passive portfolios today.
2015-09-16 00:00:00 The Fed's Dilemma by Scott Minerd of Guggenheim Partners
The U.S. Federal Reserve’s rate rise history reveals a familiar dilemma—previous delays led to inflated asset prices and recessions.
2015-09-15 00:00:00 China: Double, Double Toil and Trouble/Fire Burn, and Cauldron Bubble? by Andy Rothman of Matthews Asia
Many argue that China’s economy is descending into policy chaos and a witches’ brew, otherwise known as a hard landing. But perhaps tellingly, even during the recent A-share fall, Chinese consumers seemed to shrug off the drama and continued to spend. China’s recent economic developments can be seen as stumbles along the path toward growth rates that are continuing to decelerate (but are still quite fast) from an economy that is increasingly “rebalanced.” This latest issue of Sinology explores the thinking behind this non-consensus conclusion.
2015-09-14 00:00:00 Early Cyclicals Moved to New Relative Highs During Recent Market Turmoil by Jennifer Thomson of GaveKal Capital
Regular readers are familiar with our reliance on ‘baskets’ of stocks in order to gain a high-level perspective on general market trends.
2015-09-11 00:00:00 Housing: A Secular Opportunity? by Adam Peck of Heartland Advisors
Low interest rates, demographics, and a solid economy should provide staying power to a resurgent housing market. We are finding opportunities to capitalize on growth in the area while diversifying idiosyncratic risks in our portfolios.
2015-09-11 00:00:00 An Expert’s Guide to Market Volatility by Russ Koesterich of BlackRock
Russ shares three themes that have emerged from his conversations with numerous clients following the market drama in recent weeks.
2015-09-11 00:00:00 Global Economic Perspective: September by Franklin Templeton Fixed Income Group of Franklin Templeton Investments
While the [US] Fed is facing an extremely delicate task ... it is still our belief that the US economy remains sufficiently strong to be able to bear a gradual increase in short-term rates in the coming months.
2015-09-11 00:00:00 Protecting Against Inflation In a Deflationary World by Steven Malin Ph.D. of Allianz Global Investors
Powerful global deflationary forces will continue to put downward pressure on the prices of inputs and outputs for months, if not years, to come. Even if the US Federal Reserve and the Bank of England raise policy interest rates over the months ahead, inflation risk premiums built into market interest rates will remain small. In the absence of strong wage increases, unprecedented global growth in the supply of resources and outputs relative to demand will linger—and inflation will remain constrained.
2015-09-09 00:00:00 Newsletter - September 2015 by Harold Evensky, of Evensky & Katz / Foldes Financial Wealth Management
Harold Evensky's quarterly letter to his readers.
2015-09-08 00:00:00 Making Sense of Market Volatility by Sponsored Content from Invesco (Article)
• On Aug. 21, the Dow Jones Industrial Average entered a correction and reminded investors what volatility looks like. • Several Invesco senior investment leaders discuss their views of market volatility. • They share how it affects, or doesn’t affect, the opportunities they see.
2015-09-08 00:00:00 Largest Driver of Performance Over the Last Month? Beta by Jennifer Thomson of GaveKal Capital
As part of our treasure trove of data and tables, we rely on our factor scoring model to tell us the most important elements that have affected performance over various time periods and in different regions. For developed markets (DM), the most influential factor over the last week and month (coming in 2nd over the last year and 5th over the last three months) has been beta.
2015-09-05 00:00:00 Meet QT; QE's Evil Twin by Peter Schiff of Euro Pacific Capital
There is a growing sense across the financial spectrum that the world is about to turn some type of economic page. Unfortunately no one in the mainstream is too sure what the last chapter was about, and fewer still have any clue as to what the next chapter will bring. There is some agreement however, that the age of ever easing monetary policy in the U.S. will be ending at the same time that the Chinese economy (that had powered the commodity and emerging market booms) will be finally running out of gas.
2015-09-04 00:00:00 Here’s Your Guide to What the Influencers Are Saying about Commodities by Frank Holmes of U.S. Global Investors
A few legendary influencers in investing are making huge bets right now on commodities, an area that’s faced—and continues to face—some pretty strong headwinds. What are we to make of this?
2015-09-04 00:00:00 Will Unsettled Markets Unsettle the Federal Reserve? by Carl Tannenbaum of Northern Trust
The question of how events in the Far East will affect the Fed has come up frequently in recent conversations. At the outset, it should be noted that central banks do not center their policies on the levels of asset markets or the level of volatility.
2015-09-04 00:00:00 Unfazed by the Turmoil by Byron Wien of Blackstone
Overall, my sense of this year’s lunches is that the participants were still basically optimistic, as they generally are. I wonder if there were something big and negative brewing out there, whether the group would be able to anticipate it.
2015-09-04 00:00:00 China Sets its Sights on Life Sciences by Jerry C. Shih of Matthews Asia
China is a market too large to be ignored—this has long been a saying among those considering doing business in the country. But increasingly, multinational corporations see China as a hub of nascent innovation. China’s evolving pharmaceutical landscape and the government’s pro-innovation policies are driving indigenous innovation in its life sciences. Asia Insight explores China’s path in this arena.
2015-09-03 00:00:00 12 Questions for a 12% Correction by Burt White of LPL Financial
The recent market downdraft and related uncertainty in China have led to many investor questions. The strong 6.5% rebound in the S&P 500 over the last three trading sessions (August 26, 27, 28, 2015) has cut the S&P 500’s losses from the 2015 peak (2130 on May 21, 2015) to 6.7%. In response to the S&P 500’s recent 12% correction?—?the first decline of more than 10% since 2011?—?we answer 12 investor questions. Bottom line, we do not expect the latest correction and China uncertainty to lead to the end of the U.S. economic expansion or the end of the six-and-a-half-year old bull
2015-09-03 00:00:00 Searching for Sustainable Growth in Malaysia by Dilip Badlani of The Royce Funds
As an active manager with a value orientation, Portfolio Manager Dilip Badlani seeks to locate inexpensive companies helmed by management teams that have demonstrated an ability to consistently execute plans to grow their business irrespective of economic conditions. Though not without its challenges, Malaysia's history of perseverance makes it an attractive market for disciplined and patient investors.
2015-09-03 00:00:00 Vietnam-EU Agreement: A Good Deal for Southeast Asia by Mark Mobius of Franklin Templeton Investments
As investors in Vietnamese stocks, the primary constraint we face is one of liquidity and limited choices in which to invest, but we are hopeful that will soon change. Vietnam has had a fast-growing economy, and we have found good companies there, including some that are state-owned.
2015-09-02 00:00:00 Bremmer’s Choices by Bill O'Grady of Confluence Investment Management
Last week, we wrote our first formal book review as a Weekly Geopolitical Report. The book, Superpower: Three Choices for America’s Role in the World, is a recently published book by Ian Bremmer in which he discusses three models for American foreign policy. In our closing comments last week, we promised to take a deeper look at Bremmer’s foreign policy models to examine their costs and benefits. In this report, we analyze his three models of exercising the superpower role, Indispensable America, Independent America and Moneyball America, and discuss which model is the most likely choice.
2015-09-02 00:00:00 Market Reset, Not Recession by John Calamos of Calamos Investments
In our view: Neither the U.S. or global economy is headed for recession; instead, we are seeing a market reset that is not entirely unexpected. Markets are likely to be extremely choppy over these next months, and we may see additional corrections. Over the near term, energy and commodity prices will remain volatile, with global interest rates and currency turmoil adding to the headwinds. Market dislocations are providing us with select opportunities to establish and build positions in fundamentally strong companies, worldwide—including in emerging markets.
2015-09-02 00:00:00 Is "New Normal" Enough to Grow China's Economy? by Jerry Zhang of Wells Fargo Asset Management
Jerry Zhang, Ph.D., CFA, explores the economic underpinnings that can spark growth in China—and, in turn, present investing opportunities for growth seekers.
2015-09-01 00:00:00 Oil Prices: The Drill Is Gone by Milton Ezrati of Lord Abbett
The nuclear deal with Iran is not yet settled, but it definitely points to, among many other things, lower oil prices. Once sanctions lift, Iran, desperate for cash, will sell all the oil it can, increasing global supplies and likely driving down prices. This one-time supply surge will, no doubt, take a while to have its full effect, until mid-2016 in all likelihood, but thereafter, slowdowns in production elsewhere in the world, including shale and tar sands in North America, should again begin to put upward pressure on the global price of crude.
2015-09-01 00:00:00 Investors Should Not "Buy the Dip" Because Macro and Market Risks Remain Elevated by Don Schreiber, Jr. of WBI Shares
The global market meltdown is turning into a rout as investors who ignored the warning signs of overvaluation, weakening earnings/revenue trends, and deteriorating internal market dynamics may now be heading for the exits. As advisors and investors try to rationalize asset allocation and equity market exposure, they may deem it appropriate to stick with investments in countries with the strongest economies. Reasoning, stronger eco-markets should behave better than markets in countries with economies under pressure.
2015-08-31 00:00:00 Making Sense of Market Volatility by Karen Dunn Kelley of Invesco Blog
On Aug. 21, the Dow Jones Industrial Average entered a correction, falling 10% from its most recent peak, and reminded investors what volatility looks like after almost four correction-free years. While volatility exposes weaknesses in the market, in my opinion it also reveals the strength of high conviction managers who are skillfully navigating the market. Active management and smart beta strategies seek to surpass the “market averages” offered by traditional benchmarks, providing the potential not only for higher returns, but also for a smoother ride.
2015-08-31 00:00:00 Stay Calm and Carry On by Kenneth Kim of EQIS Capital
As most everyone is aware, the markets have been highly volatile, and mostly down, during these past few days. Everyone seems to be pointing fingers at China’s slowing economy as the cause. Before joining EQIS, I was a professor of finance at Renmin University in Beijing, China for many years. Recognized as one of the top 15 economists* in China, and a frequent economic commentator on the Chinese economy on China’s only English-language national television station, I can speak about, and address, this current market condition that places blame on China.
2015-08-28 00:00:00 Don't Panic: Putting Market Turbulence in Context by Tom Fahey of Loomis Sayles
Sharp declines in China’s equity markets have heightened fears about the country’s economic prognosis and what it might mean for global growth. While concerns center on the emerging markets, the tumult has spilled across global financial markets. Our advice: don’t panic.
2015-08-28 00:00:00 On Market Corrections, and Keeping a Calm Head by Mark Mobius of Franklin Templeton Investments
Despite recent market volatility, we consider the long-term outlook for China’s market and economy to be good. We don’t view this recent correction as the start of any sort of economic or market collapse underway, and it doesn’t change our view on investing there.
2015-08-28 00:00:00 12 Attractive Fast-Growing Dividend Growth Stocks for High Total Return by Chuck Carnevale of F.A.S.T. Graphs
The current market environment is presenting many challenges to the conservative retired investor in need of current income. Interest rates are near all-time lows and the valuations of many blue-chip dividend growth stocks have become extended. Consequently, it is becoming very difficult to find quality investment opportunities that can provide safety through sound valuation, attractive yield and the potential to fight inflation.
2015-08-28 00:00:00 Times Like This by Robert Horrocks of Matthews Asia
Times like this in the markets can be unsettling. We are accustomed to dealing with risk, or at least familiar with “normal” market swings from year to year. But when there is a sudden abrupt fall in markets, investors are often left to wonder “What is going on?” Are we seeing a repeat of 1997? 2013? Matthews Asia’s Chief Investment Officer Robert Horrocks, PhD, offers his views on recent developments, drawing from historical context but also noting the instances in which history can be misleading.
2015-08-28 00:00:00 China’s Economy Is Undergoing a Huge Transformation That No One’s Talking About by Frank Holmes of U.S. Global Investors
Misconception and exaggeration are circling China’s economy right now like a flock of hungry buzzards. If you listen only to the popular media, you might believe that the Asian giant is teetering on the brink of economic disaster, with the Shanghai Composite Index’s recent correction and devaluation of the renminbi held up as “proof.”
2015-08-26 00:00:00 A Macro View of Recent Market Volatility by Michael Hasenstab and Sonal Desai of Franklin Templeton Investments
When we look at how much market panic there has been, you’d be under the impression China is headed full-speed into full-blown recession. That is not our call. We expect moderation in China’s growth and continue to see it as healthy.
2015-08-26 00:00:00 China Commentary by John Calamos: Market Reset, Not Recession by John Calamos Sr. of Calamos Investments
The global market selloff of these past days has tested the mettle of many investors—particularly as the turmoil has followed an unusual period earlier this year, where equities delivered healthy advances with very little volatility. While we’ve gone on record saying that we expected volatility to persist (including in our most recent Outlook), we have been surprised by how severe the downturn has been. However, experience teaches that there can be many opportunities in volatile markets.
2015-08-26 00:00:00 As Market Fears Grow, Stay Focused on the Long Term by Brad McMillan of Commonwealth Financial Network
One bad day doesn’t make a bear market. Two bad days, however, and the prospect of more to come, may well signal one.
2015-08-26 00:00:00 Markets Crashing, Gold Rising by Clint Siegner of Money Metals Exchange
U.S. Investors are on edge following last week’s and today’s sell-off in stocks around the globe. The carnage impacted equity markets in Asia, Europe, and the U.S. Interestingly, the U.S. dollar also weakened. And bonds and gold are getting most of the safe-haven buying.
2015-08-25 00:00:00 On My Radar: An Optimist Sees The Opportunity In Every Difficulty by Steve Blumenthal of CMG Capital Management Group
“A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.” – Winston Churchill
2015-08-21 00:00:00 Developed Asia Pacific: Economy Trends Update July 2015 by Team of Thomas White International
After a slump in consumer spending had raised concerns of an economic slowdown in Japan recently, there was a welcome uptick in indicators such as manufacturing activity and exports. However, slowing growth in China, a major trading partner, is widely expected to have a bearing on the economy in the near future. Meanwhile, the Reserve Bank of Australia left interest rates unchanged in its recent review as expected, thanks to subdued inflation, a stabilizing job market, and early signs of a pick-up in business investment.
2015-08-21 00:00:00 Gold Glimmers as Global Market Fear Grips Investors by Frank Holmes of U.S. Global Investors
Gold this week broke above its 50-day moving average as a fresh round of negative news from around the globe rekindled investors’ interest in the yellow metal as a safe haven. The Fear Trade, it seems, is in full force.
2015-08-21 00:00:00 Is a Stronger U.S. Dollar Really Bad News? Three Myths about Emerging Markets by Michele Mazzoleni of Research Affiliates
A strengthening U.S. dollar threatens emerging market economies—owes its plausibility to three myths. Let’s examine them.
2015-08-21 00:00:00 Pressure Mounts on China to Act by Scott Minerd of Guggenheim Partners
Weak manufacturing data out of China indicate that its policymakers will have to act drastically to reverse its decline.
2015-08-20 00:00:00 Unattractive ‘Glamour Stocks’ Lead the Way in Asia Pacific by Brent Bates of Invesco Blog
Economic growth continues to decelerate across the Asia Pacific region. Domestic economies have not been robust enough to offset weakness in commodities and exports, and both revenue and earnings expectations were adjusted downward by 1% during the second quarter. Because growth is scarce, investors have been crowding into the highest-growth and highest-quality stocks; within Asia and Japan, this group of stocks is now trading at the highest premium to the rest of the market that we’ve seen in the past 20 years.
2015-08-19 00:00:00 Global Economic Perspective: August by Franklin Templeton Fixed Income Group of Franklin Templeton Investments
We believe sound headline job creation figures point to rate increases by a [US] Fed that would like to begin to ‘normalize’ monetary policy when possible. The US economy is no longer in the emergency room, as it was in December 2008.
2015-08-19 00:00:00 Global Economic Overview: July 2015 by Team of Thomas White International
While some of the emerging economies continue to face slow growth from lower commodity exports, the outlook for most developed economies has brightened in recent months. The U.S. slowdown during the first half of this year was not as bad as thought earlier, while economic trends from the Eurozone remain stable. Helped by sustained labor market gains, U.S. consumer sentiment is picking up again and should help aggregate growth during the second half of the year.
2015-08-19 00:00:00 One man’s weed... by Jerry Wagner of Flexible Plan Investments
I spent time at the Woodward Dream Cruise this week in my brother Charlie’s 1985 Ford Mustang convertible (his first new car which he bought and has maintained since that year). I think the Cruise is the largest annual assemblage of classic cars on the planet. What a great time for anyone who enjoys historical vehicles and the memories they bring back, especially here in the Motor City.
2015-08-19 00:00:00 Why the Yuan Devaluation Does Not Erode China’s Long-Term Investment Potential by Nick Niziolek of Calamos Investments
In his blog post, titled “Why the Yuan Devaluation Does Not Erode China’s Long-Term Investment Potential,” SVP and Senior Co-Portfolio Manager Nick Niziolek discusses the opportunities the Calamos team sees in China.
2015-08-18 00:00:00 International Equity Commentary: July 2015 by Team of Thomas White International
International equity prices were mostly unchanged during the month of July as gains in Europe were offset by losses in Asia and select other markets such as Canada. Further improvement in economic trends from the Euro-zone and the tentative agreement to provide additional financial support to Greece brightened investor sentiment in the region.
2015-08-17 00:00:00 Chinese Yuan Depreciates Further: What is the Endgame? by Rob Waldner of Invesco Blog
After China’s surprise devaluation of the yuan by 1.9% last Tuesday, the Chinese currency was devalued by another 1.6% on Wednesday. Policymakers appear to be following a pattern of setting the daily fix, which sets the center point for trading during that day, with reference to the market price at the close of the previous day. Invesco Fixed Income believes that further devaluations are likely as the People’s Bank of China (PBoC), the country’s central bank, acquiesces to market pressure and price movements over time.
2015-08-17 00:00:00 On My Radar: China’s Surprise – Power To The Dollar by Steve Blumenthal of CMG Capital Management Group
“Something is deeply wrong if an economy is not growing, because it means these natural processes are impeded. That is why around the world, since the Dark Ages, lack of growth has been a signal of political oppression or instability. Absent such sickness, growth occurs.”– Adam Posen, “Debate: The Case for Slower Growth”
2015-08-14 00:00:00 Your Economics (and Market Structure) Summer Reading List by Jeff Hussey of Russell Investments
Global CIO Jeff Hussey offers an economics summer reading list (plus one book on market structure).
2015-08-14 00:00:00 The Shot Not Heard Around the World by Peter Schiff of Euro Pacific Capital
China’s recent move to devalue the yuan has sent shock waves through the global financial markets and has convinced most observers that a new front in the global currency wars has begun. The move has caused...
2015-08-14 00:00:00 China Not Immune to Contagious Quantitative Easing and Massive Printing of Cheap Money by Frank Holmes of U.S. Global Investors
First it was the U.S. Federal Reserve. Then, in 2013, Japan launched what became known as Abenomics. The European Central Bank (ECB) followed suit in 2014. And now the People’s Bank of China has joined the parade. All of them in some way stimulated economic growth by initiating monetary quantitative easing (QE) programs.
2015-08-14 00:00:00 China Breaks into a New Range by Carl Tannenbaum of Northern Trust
For some time, analysts have suspected that China’s economic performance was trending well below targeted levels. The equity market correction that began earlier this summer seemed to confirm these concerns; only a substantial amount of official intervention prevented an outright crash. Now we can add exchange-rate uncertainty to the list of things that China will have to manage very carefully.
2015-08-14 00:00:00 China Currency Devaluation Update by Teresa Kong of Matthews Asia
What are the factors that prompted Chinese authorities to recently devalue the renminbi? Matthews Asia Portfolio Manager Teresa Kong, CFA, examines the lead up and implications of this development.
2015-08-13 00:00:00 3 Things: Freight, Deflation, No Hike by Lance Roberts of Streettalk Live
We often look at broad measures of the economy to determine its current state. However, we can often receive clues about where the economy may be headed by looking at data that feeds into the broader measures. Exports, imports, wage growth, commodity prices, etc. all have very important ties to the health of the consumer which is critical to an economy that is nearly 70% driven by their consumption.
2015-08-12 00:00:00 Emerging Markets Winners and Losers: Q2 2015 by Jackie Lafferty of Loomis Sayles
Following positive performance in the first quarter, emerging markets (EM) came under pressure from macroeconomic factors in the second quarter, resulting in mixed returns for the asset class.
2015-08-12 00:00:00 Turkey’s Predicament by Bill O’Grady of Confluence Investment Management
It is our view that over the next few decades Turkey is well positioned to return to its status as a dominant regional power; however, the situation is much less clear in the near term. Turkey has been trying to run a foreign policy of having “no problems” with its neighbors. This stance has become impossible to maintain. Unfortunately for President Erdogan, Turkey is encircled by instability and is struggling to develop a response.
2015-08-12 00:00:00 Global Economic Slowdown - Implications For US Stocks by Gary Halbert of Halbert Wealth Management
The global economy is rolling over to the downside for the most part. The question is, will this global slowdown take the US economy down with it? While no one knows for sure, that possibility simply cannot be ruled out. If the softening in the global economy leads to a slowdown in the US, that will almost certainly result in a weakening of our stock markets.
2015-08-10 00:00:00 International Economic Week in Review For Aug. 3-7 by Hale Stewart of Hale Stewart
The week started off poorly with the Chinese PMI dropping from 49.4 to 47.8. The overall trend for this indicator is clearly lower.
2015-08-10 00:00:00 Down Gaps Have Doubled In the Last Month by Jennifer Thomson of GaveKal Capital
One of many market internal indicators that we use– the number of stocks that are gapping lower at the open of trading– is signaling an increase in emotional selling behavior over the last month or so, quickly jumping from 1,000 to 2,000 (blue line, axis inverted) for the MSCI World Index. While this move is not without precedent, the historic correlation between an increase in down gaps and a decline in the market warrants attention– especially in light of how quickly the number of down gaps can accelerate as market prices decline.
2015-08-10 00:00:00 The Emerging Markets Best Positioned to Withstand a Fed Hike by Russ Koesterich of BlackRock
Russ explains why not all emerging markets are created equal when it comes to weathering capital outflows associated with higher U.S. interest rates.
2015-08-07 00:00:00 Fundamentals and Policy Keep RMB Afloat by Hayden Briscoe of AllianceBernstein
Even before the recent correction in China’s A-Shares market, a number of investors had expressed skepticism about our positive outlook for the renminbi (RMB). Some even saw a devaluation as a possibility. For a variety of reasons, we continue to see the currency appreciating.
2015-08-07 00:00:00 Gold Holds Its Own Against These Media Darlings by Frank Holmes of U.S. Global Investors
A recent Bloomberg article points out that the gold rout has cost China and Russia $5.4 billion, an amount that would sound colossal were it not for the fact that U.S. media companies such as Disney and Viacom collectively lost over $60 billion for shareholders in as little as two days this week. Below are the weekly losses for just a handful of those companies. Compared to many other asset classes, gold has held up well, even after factoring in its price decline.
2015-08-07 00:00:00 US Equity and Economic Review For August 3-7 by Hale Stewart of Hale Stewart
The ISM’s US manufacturing number decreased from 53.5 to 52.7, but remained above the key 50 level. New orders and production continued their lengthy periods of expansion. 11 of 18 industries grew. The anecdotal comments are interesting:
2015-08-06 00:00:00 Global Growth Forecast - Q3 (Infographic) by Rick Harrell of Loomis Sayles
Every quarter, we update our forecast map. What's different this time? We have shaved our US GDP forecast down to 2.3% from 2.9%, mostly on account of weaker exports, a strong dollar and the decline in oil prices. In emerging markets, we still believe Asia Pacific is currently a bright spot - but we expect China to slow further as easing measures fail to gain traction.
2015-08-05 00:00:00 Reflections on the Iran Deal by Bill O’Grady of Confluence Investment Management
Last month, the P5+1 and Iran concluded negotiations on a nuclear deal. In this report, we will offer some reflections on the agreement, including why it occurred, and the major reason why the U.S. negotiated this agreement and the underlying issues. As always, we will conclude with market ramifications.
2015-08-03 00:00:00 A Look at Reported Results, and Subsequent Price Performance by Jennifer Thomson of GaveKal Capital
With slightly more than half of the constituents in the MSCI World Index having reported 2Q results, we thought it would be useful to take a look at the trend in sales and earnings so far. In the developed world, about 54% of those companies that have reported sales results have surprised positively, led by the Health Care and Financials sectors. The most negative sales surprises have been concentrated in the Consumer Staples, Materials, and Industrials sectors.
2015-08-02 00:00:00 International Economic Week in Review: Emerging Market Exodus, Edition by Hale Stewart of Hale Stewart
One of the biggest stories to emerge has been the decline in Emerging Market Currencies. The IMF noted this in their latest World Economic Outlook.
2015-08-02 00:00:00 Is Now the Time to be Bearish on China? by Andy Rothman of Matthews Asia
One of the world’s largest hedge funds has turned bearish on China, arguing that the recent stock market correction means ‘‘there are now no safe places to invest’’ in that country. I disagree. I respect Bridgewater as an investment house and their views require serious attention. But I think it worthwhile to explain some areas where my views differ.
2015-08-02 00:00:00 More Evidence of China Slowing Permeating Asia – 7/31/2015 by Bryce Coward of GaveKal Capital
In today’s edition we highlight just a few data points: the South Korea Business Survey Index making a new low, Japan consumption expenditure having a very weak month, and Japan CPI headed back toward zero. The slowing of the biggest economy in Asia is really having a noticeable impact on the region.
2015-08-02 00:00:00 Europe: Back to Business by Philippe Brugere-Trelat of Franklin Templeton Investments
The main very positive consequence of the Greek rescue agreement—even if nobody in Greece or in the eurozone at large seems to like it—is that Greece appears to be staying in the eurozone and the construct has been safeguarded.
2015-08-01 00:00:00 Gold on Sale, Says the Rational Investor by Frank Holmes of U.S. Global Investors
The leveraged gold futures derivatives market is knocking down the precious metal, yet in massive contrast, this drop has ignited a shopping frenzy according to gold coin dealers. I spoke with several friends and industry experts this week who confirmed the record sales numbers for the month. In fact, American Gold Eagle sales reached 161,500 ounces in July, the highest monthly figure since April 2013. What gives?
2015-07-30 00:00:00 A Midyear Look at Global Real Estate by Ivy Global Real Estate Team of Ivy Investment Management Company
There are many drivers of recent short-term price changes for publicly traded real estate companies in the current market environment. These include changes in the market’s outlook for economic growth, for interest rate movements, for central bank actions and even the issues surrounding Greece and Ukraine.
2015-07-30 00:00:00 When the Fed Begins to Tighten, Quality Stocks Matter by Jeff Moser of Wells Fargo Asset Management
The Federal Reserve has finally signaled its intent to raise (or normalize) interest rates. The question for investors now is what sort of companies stand to benefit the most, as Fed stimulus exits the system? Low-quality stocks benefited from a long cycle of Fed accommodation, but the potential for tighter monetary policy could mean investors should look to higher-quality stocks instead. In a potentially rising-interest-rate environment, investors should look for these five indications of quality.
2015-07-29 00:00:00 Ten Quick Topics to Ruin Your Summer by Jeremy Grantham of GMO
Chief investment strategist Jeremy Grantham reviews "10 topics that really matter, at least in my opinion. They can all be viewed as problems: potential threats to our well-being"
2015-07-26 00:00:00 Chugging Along by John Osterweis, Matt Berler of Osterweis Capital Management
Sitting down to write this quarter’s Outlook we feel a bit sheepish. Despite all the headlines and drama around the world (e.g., Greece, Mid-East turmoil, China stock market bubble), not much has changed in our outlook for the U.S. economy or the U.S. financial markets. The U.S. economy appears to have rebounded in the second quarter from the first quarter swoon.
2015-07-25 00:00:00 International Economic Week in Review: IMF Lowers Growth Projections, Edition by Hale Stewart of Hale Stewart
At the macro level, the IMF lowered their global growth outlook. The first quarter slowdown in the developed world (largely the US but to a lesser extent Canada) led to decreased 2H15 projections, while the commodity slowdown will negatively impact the developing world. As further evidence of this, note that Latin American currencies are broadly selling off. Low inflation gives central banks plenty of policy room. The wild cards continue to be the cumulative impact of the Chinese slowdown along with certain geopolitical factors such as the Middle East turmoil and Greek situation.
2015-07-25 00:00:00 3 Reasons Why Gold Isn’t Behaving Like Gold Right Now by Frank Holmes of U.S. Global Investors
The last time the metal descended this quickly was 18 months ago, on January 6, 2014, when someone brought a massive gold sell order on the market before retracting it in a high-frequency trading tactic called “quote stuffing.”
2015-07-25 00:00:00 Asia Insight: Online to Offline—The Great Technology Migration by Michael Oh of Matthews Asia
Asia has demonstrated an uncanny ability to leapfrog certain technological developments, making much quicker transitions to new technologies than Western countries: jumping from fixed line to wireless communications and moving away from desktop devices to mobile devices. Now, the latest interesting instance of technology leapfrogging that is happening in Asia is dubbed “Online-to-Offline,” commerce, or O2—an e-commerce model that combines offline opportunities with online platforms. Asia Insight explores.
2015-07-23 00:00:00 Are MLPs Waiting for Godot? by David Chiaro of Eagle Global Advisors
Like the absurdist play where two characters Vladimir and Estragon wait for a mysterious Godot who never shows up, investors in MLPs continue to wait for definitive answers to the "big questions" facing MLPs: when will interest rates rise and what will happen with future oil production and prices?
2015-07-23 00:00:00 Mid-Year Outlook: Global Economy Likely to Withstand China, Greece by John Calamos, Sr. of Calamos Investments
The global markets and economy should be able to move higher for the remainder of the year, with accommodative monetary policy and well-contained inflation providing tailwinds. The U.S. looks set to extend its not-too-hot, not-too-cold recovery, while Japan is benefiting from stimulus and pro-market reforms. Although economic conditions in Europe remain fragile and uneven, growth looks to be accelerating overall, and we believe the European Union has the tools to prevent a broader Europe contagion should the Greek bailout resolution fall apart.
2015-07-22 00:00:00 The BOJ’s Policy: What’s Next, More Easing? Or Something Else? by Tomoya Masanao of PIMCO
Investors are now debating what the next step will be for the Bank of Japan. It is a dramatic turn, isn’t it? Earlier this year, the consensus view was that the BOJ would move forward with additional easing – the question was ‘when’, not ‘if’.
2015-07-22 00:00:00 Currencies Depend on Faith, Gold Doesn’t by Peter Schiff of Euro Pacific Capital
In his July 17th Blog, Let's Get Real About Gold, author and Wall Street Journal columnist Jason Zweig likened investor interest in gold with the "Pet Rock" craze of the 1970's, when consumers became convinced that a rock in a box would provide continuous companionship, elevate their social standing, and give them something hip to talk about at parties. Zweig asserts that investor faith in gold, which he argues is just another inert mineral with good marketing, is similarly irrational, and has kept people from putting money in the much more lucrative stock market.
2015-07-21 00:00:00 Secular Outlook: Implications for Asia-Pacific Investors? by Eric Mogelof, Alan Isenberg of PIMCO
We hope you have had the opportunity to review the summary from our secular forum in May: “The New Neutral Revisited,” written by PIMCO’s Group CIO Dan Ivascyn, Global Fixed Income CIO Andrew Balls an?d Global Strategic Advisor Rich Clarida. In this analysis, the authors identify the six key themes that emerged from our discussion, as well as six risks.
2015-07-19 00:00:00 Imperial Germany by Bill O’Grady of Confluence Investment Management
Last week, we analyzed the Greek/Eurozone negotiations using game theory as an explanatory tool. In this report, we will review the basic geopolitics of Europe, the political response and the evolution of the Eurozone. Using this background, we will examine Germany’s actions in the most recent Greek crisis. As always, we will conclude with market ramifications.
2015-07-17 00:00:00 More Evidence of China Slowing Permeating Asia – 7/16/2015 by Bryce Coward of GaveKal Capital
Yesterday saw a few more weaker data points out of Australia and South Korea that are worthy of mention. Namely, Australian consumer confidence dropped again to around the lowest it’s been since 2009 and South Korea unemployment remained at its cycle highs. No matter what the top line China GDP number was, there is no doubt that China is on a structurally slower growth trajectory and this is most definitely affecting its closest neighbors.
2015-07-17 00:00:00 Crude Oil Is the Best-Performing Commodity of 2015 So Far by Frank Holmes of U.S. Global Investors
The widest expansion this year was made by none other than crude oil, the worst-performing commodity of 2014. As of June 30, oil posted gains of over 11 percent, rising to $59.47 per barrel. After falling more than 50 percent since last summer, though, it had little else to go but up. That oil claimed the top spot just highlights the reality that commodities are in a depressed state right now.
2015-07-17 00:00:00 Northern Trust Perspective by Jim McDonald of Northern Trust
Last month we said that the odds favored some sort of “kick the can down the road” agreement between Greece and its creditors, and it looks like that may be coming to pass. While there’s still much work to be done, the tone of the current agreement seems focused on avoiding a euro exit and debt write-downs, while ignoring growth-oriented policies. With the hard decisions yet again put off for another day, this should be euro-weakening, all else equal.
2015-07-17 00:00:00 China's Rebalancing Continues by Andy Rothman of Matthews Asia
The rebalancing of China’s economy continued in the second quarter of this year, as services and consumer spending drove more growth than industry and construction. The inevitable deceleration of most year-on-year (YoY) growth rates also continued, but a booming stock market provided a temporary lift to headline GDP growth.
2015-07-16 00:00:00 China: Searching for a New Equilibrium by Michael Hasenstab of Franklin Templeton Investments
Overall, based on our detailed analysis, we believe China will remain on course … while the economy shifts toward consumption, services and higher value-added manufacturing. This could have important implications for the global economy.
2015-07-16 00:00:00 Navigating Market Signals in Multi-Asset Portfolios by Rob Balkema of Russell Investments
Russell Investments’ Rob Balkema provides insights on how a portfolio manager looking at Japan might use market signals to manage multi-asset class funds.
2015-07-15 00:00:00 Volatile Estimates in Europe by Jennifer Thomson of GaveKal Capital
Changes in sales and earnings estimates have historically ranked fairly high in our factor analysis– a methodology we employ to gauge which variables have the greatest influence on/ correlation with moves in the overall market.
2015-07-14 00:00:00 An Update on China from Charlie Awdry by (Article)
Charlie Awdry, Investment Manager in Henderson’s Asia ex Japan equities team, discusses the recent volatility we are seeing in Chinese equity markets. With shares being suspended from trading and further government action expected, this downturn in Chinese equities is causing nervousness among investors in the retail investor dominated Chinese markets.
2015-07-14 00:00:00 Correlation Among Stocks, Especially In Europe, Have Shot Higher by Eric Bush of GaveKal Capital
Over the past several weeks, correlations among stocks have been increasing which makes it increasingly difficult for stock pickers to outperform. The most dramatic example of this is happening in Europe.
2015-07-14 00:00:00 Perspectives on China by Nick Niziolek of Calamos Investments
There are considerable opportunities in China for disciplined, fundamentally driven investors. China’s medium- and longer-term secular tailwinds remain intact. Our team continues to encourage investors to look past the short-term noise and remain focused on the longer-term potential. The economic transition that China is attempting is incredibly challenging. Right now, Chinese regulators have taken a kitchen-sink approach. While it hasn’t achieved the desired effect, it affirms the depth of China’s commitment to stabilize its markets.
2015-07-13 00:00:00 On My Radar: High Probability of a Global Recession by Steve Blumenthal of CMG Capital Management Group
Economists have a number of different ways to measure over and under valuation. Most measures currently show an overvalued equity market. Let’s just say the market is expensively priced.
2015-07-11 00:00:00 Global Investors: You Should Be Paying Attention to this Economic Indicator by Frank Holmes of U.S. Global Investors
In addition to our own macro models, BCA Research , a highly respected independent research company, pointed out that PMIs in developing economies have plunged to new lows. The International Monetary Fund also revised downward its global growth forecast for 2015. On this account, bad news is good news, as central bankers are scrambling to stimulate economic growth.
2015-07-11 00:00:00 China Market Update by Andy Rothman of Matthews Asia
China’s equity markets have steadily declined for weeks, raising a torrent of questions and concerns. Given that China accounts for more global growth than the U.S., Europe and Japan combined, this week Andy Rothman, Investment Strategist at Matthews Asia, answers some of your most pressing questions.
2015-07-10 00:00:00 More Evidence of China Slowing Permeating Asia by Bryce Coward of GaveKal Capital
Yesterday and today were host to a few more macro data points all signaling basically the same thing – a synchronized slowdown in Asia which appears to be driven by China. In the five charts below we show that Chinese CPI remains anemic while PPI just made a new cycle low, Australian unemployment ticked up, Japanese bank loans appear to be topping/rolling over, the Japanese economy watchers survey is rolling over, and Japanese machinery orders excluding ships keeps weakening.
2015-07-10 00:00:00 China Market Update by Andy Rothman of Matthews Asia
China’s equity markets have been in steady decline for several weeks, raising a lot of questions about the potential impact on the world’s second-largest economy. Given that China accounts for more global growth than the U.S., Europe and Japan combined, this is an important topic for investors.
2015-07-09 00:00:00 While Attention Has Been On China, EM Latin America Keeps Taking It On The Chin by Eric Bush of GaveKal Capital
EM Latin America stocks are by far the worst performing stocks in the world this year. So even though all eyes are on China at the moment, as Bryce recently pointed out, the Chinese stock market doesn’t matter much for non-Chinese investors.
2015-07-07 00:00:00 A First-Half Letter to Clients: Robert Shiller on the Valuation Quandary by Dan Richards (Article)
Since 2008, I have posted a template for a client letter each quarter as a starting point for advisors who want to send clients an overview of the period that just ended and some thoughts looking forward. This quarter’s letter addresses one of today’s most taxing questions for advisors and investors alike: How to deal with the quandary presented by today’s valuation levels on U.S. stocks.
2015-07-07 00:00:00 Asia Better Positioned to Handle a Hike by Sponsored Content from Invesco (Article)
It’s no surprise investors are concerned about whether a Fed rate hike will cause a replay of 2013’s taper tantrum meltdown in Asia. In our view, Asian markets are better positioned today to withstand short-term deterioration in global sentiment when the Fed decides to hike rates.
2015-07-07 00:00:00 Emerging-Market Stocks: Back on the Map by Milton Ezrati of Lord Abbett
After the volatility of the past few years, conditions once again appear favorable for this asset class.
2015-07-06 00:00:00 Exporting the “Bacon Genie” and Other Reasons to Be Bullish by Brooks Ritchey of Franklin Templeton Investments
From “Bacon Genies” to “Snuggies,” there’s little doubting Americans have a thirst for consumer goods, even those that don’t always appear to serve much practical purpose. Brooks Ritchey, Senior Managing Director at K2 Advisors®, Franklin Templeton Solutions®, explores how an evolving consumer culture is spreading throughout the globe, and how he and his team are positioning their portfolios with these types of macro considerations in mind.
2015-07-06 00:00:00 US Equity and Economic Review For the Week of June 29-July3; Some Weakness Technical Emerging by Hale Stewart of Hale Stewart
The biggest news last week was the employment report, which contained a headline number (223,000) a bit weaker than we’ve gotten used to. But, there is a very reasonable explanation.
2015-07-02 00:00:00 Home of the Free, Land of the Entrepreneur by Frank Holmes of U.S. Global Investors
Where else but in America can a startup such as Uber be valued at $50 billion, higher than 80 percent of the companies in the S&P 500 Index, only six years after its founding? Where else but in America can someone reach billionaire status by inventing a new type of hosiery, as Sara Blakely did with Spanx? Before her now-ubiquitous undergarments were worn by women—and now men—all over the globe, Blakely was so broke that she had to write her own patent without the help of an attorney.
2015-07-01 00:00:00 The Smartest Man is Wild about Innovation by Byron Wien of Blackstone
For the past fifteen years I have written annually about a person I have come to call “The Smartest Man in Europe.” For new readers, he is a finance person in his 80’s who has built his reputation by identifying important trend changes early and putting serious money behind his conclusions. Descended from a mercantile family that operated canteens selling food and weather protection along the Silk Route, he was educated in Europe, trained in New York and returned home to take advantage of the wealth-creating opportunities resulting from the post-war recovery.
2015-07-01 00:00:00 The 2015 Mid-Year Geopolitical Outlook by Bill O’Grady of Confluence Investment Management
As is our custom, at mid-year, we update our geopolitical outlook for the rest of the year. This report is less a series of predictions as it is a list of potential geopolitical issues that we believe will dominate the international situation into year’s end. It is not designed to be exhaustive; instead, it focuses on the “big picture” conditions that we believe will affect policy and markets going forward. They are listed in order of importance.
2015-07-01 00:00:00 Growth Matters by Mark Mobius of Franklin Templeton Investments
We have found that companies in the consumer or retail space with a high market share can benefit from rising consumption and GDP per capita. These investments are particularly attractive if profit margins can be improved.
2015-06-27 00:00:00 $8 Trillion Alternative Energy Boom Is a Win for Copper by Frank Holmes of U.S. Global Investors
As the world’s population continues to grow, and as more people in developing and emerging countries gain access to electricity, the role alternative energy sources such as wind, solar and geothermal play should skyrocket. Between now and 2040, a massive $8 trillion will be spent globally on renewables, about two thirds of all energy spending, according to Bloomberg New Energy Finance. Solar power alone is expected to draw $3.7 trillion.
2015-06-26 00:00:00 India's Structural Challenges by Sudarshan Murthy of Matthews Asia
India is in need of sweeping reforms in order to realize the full power of its entrepreneurial talent and to ensure social improvements for its poor and middle class. Despite some encouraging efforts, the Modi government may need significant time to carry out such reforms, as its many public institutions are still a far cry from being considered inclusive—meaning they lack such attributes as well-defined property ownership rights, flexible labor policies and all-encompassing political representation.
2015-06-25 00:00:00 Building for the Future: Infrastructure in Emerging Markets by Mark Mobius of Franklin Templeton Investments
Emerging economies in general have experienced stronger economic growth trends than developed markets over the past decade, a trend that I expect to continue. That growth, combined with rising populations and a trend toward urbanization, requires more infrastructure.
2015-06-24 00:00:00 Handicapping Bubbles and Shocks by Kristina Hooper of Allianz Global Investors
Kristina Hooper, US Investment Strategist for Allianz Global Investors, explains the results of the 2015 Allianz Global Investors RiskMonitor Survey, a global study of prevailing views on portfolio construction, asset allocation and risk among a cross-section of institutional investors.
2015-06-23 00:00:00 How Small Mistakes Can Boost Your Credibility by Dan Richards (Article)
An advisor struggled to convert meetings with prospects into clients. Then he began describing how he’d helped existing clients in a way that made him more credible and sincere.
2015-06-23 00:00:00 Cyber Security and Terrorism: Case Studies by Kaisa Stucke of Confluence Investment Management
This week we will look at two case studies of cyber attacks aimed at sovereign nations, the Estonian cyber attacks in 2007 that spanned three weeks and the multi-faceted attacks in Georgia in 2008. We will then look at the current state of international cyber attack research, readiness and cooperation. We have had the pleasure of talking to the NATO Cooperative Cyber Defence Center of Excellence about their work and will communicate their vision and challenges.
2015-06-22 00:00:00 A Chinese Swap Meet by Andy Rothman of Matthews Asia
The new local bond swap program of China’s Communist Party is its latest effort to manage debt. It aims both to make the amount and structure of local government debt more transparent, and to reduce the financing burden of local government debt. Could this be considered a version of quantitative easing or a bailout? Could it lead to local government defaults?
2015-06-22 00:00:00 Global Review and Equity Commentary: May 2015 by Team of Thomas White International
The decline in U.S. economic activity during the first quarter was more than earlier estimates, and appears to have weakened business sentiment in other parts of the world. Most of the fall in U.S. aggregate output was due to temporary factors such as adverse weather and port disruptions that led to delayed export shipments. The stronger dollar also reduced the earnings growth of large U.S. corporations with a global footprint.
2015-06-19 00:00:00 Global Economic Perspective: June by Team of Franklin Templeton Investments
In spite of lingering concerns about Greece’s fate, the European economy would appear to have hit a sweet spot marked by steadily improving growth and inflation figures along with declining unemployment.
2015-06-19 00:00:00 Northern Trust Perspective by Jim McDonald of Northern Trust
While we expect U.S. growth to see some improvement from the slow start to the year, we think optimists are likely to be disappointed at the overall pace of growth. The U.S. economy has averaged 2.2% growth since the financial crisis, and we don't see a material acceleration during the near-to-intermediate term. The prospect of a pending increase in the Fed funds rate has contributed to a rise in interest rates and strengthening of the dollar, both of which serve as a constraint on growth. We also don't see much upside to the U.S. economy through materially better growth outside the U.S.
2015-06-18 00:00:00 Picking U.S. Energy, Housing and Other Credit Sectors for the Long Haul by Mark Kiesel of PIMCO
Persistent trends in economies around the world are providing opportunities for focused, long-term investors in the credit markets. Mark Kiesel, Chief Investment Officer Global Credit, discusses promising themes PIMCO sees over the next three to five years, including the U.S. energy revolution, the rising Asian consumer, the ramifications of global banking regulation and latent demand in the U.S. housing market. PIMCO’s global investment professionals gathered in May at our annual Secular Forum to discuss our long-term, or secular, views of economies and markets around the world.
2015-06-17 00:00:00 Weighing the Week Ahead: A Market Message for the Fed? by Jeffrey Miller of NewArc Investments, Inc.
While few expect a change in Fed policy at this week’s FOMC meeting, it will still be the center of attention. With last week’s interest rate jump, I expect the theme to be: Is the market sending the Fed a message?
2015-06-17 00:00:00 Need Income? Let’s Talk by Alison Martier of AllianceBernstein
Investors and their advisors know how tough it is to generate income in today’s low-interest-rate world. Forthright and frequent conversation about how far they’re willing to go to boost returns can help.
2015-06-15 00:00:00 Luxury Spending in China by Winnie Chwang of Matthews Asia
Over the past decade, conspicuous consumption has been seen across China and Hong Kong, emerging as a natural by-product of an economy experiencing rapidly rising levels of affluence. Across China, there have been stories of unbelievable extravagance, from diamond-studded smartphone cases to gold-plated sport cars and replicas of homes that resemble the White House. However, these days of excessive spending in China may already have waned. Asia Weekly explores.
2015-06-14 00:00:00 The People’s Republic of Debt by John Mauldin of Mauldin Economics
Among the most important questions for all investors and businessmen is, how will China manage its future and the problems it faces? There are many problems, some of them monumental – and at the same time there is an amazing amount of opportunity and potential. Understanding the challenges and deciphering the likely outcomes is itself an immense challenge.
2015-06-12 00:00:00 U.S. Economy Turns on the Afterburners-Is a Rate Hike Next? by Frank Holmes of U.S. Global Investors
So when will rates be raised again? Next Wednesday the world will tune in to see if Fed Chair Janet Yellen can answer that question. Though it's anyone's guess what she'll say, there's no denying that many of the economic indicators the Fed is keeping an eye on have sharply improved lately.
2015-06-12 00:00:00 Luxury Spending in China by Winnie Chwang of Matthews Asia
Over the past decade, conspicuous consumption has been seen across China and Hong Kong, emerging as a natural by-product of an economy experiencing rapidly rising levels of affluence. Across China, there have been stories of unbelievable extravagance, from diamond-studded smartphone cases to gold-plated sport cars and replicas of homes that resemble the White House. However, these days of excessive spending in China may already have waned. Asia Weekly explores.
2015-06-10 00:00:00 Low Valuations Tough to Come By, Wherever You Look by Jennifer Thomson of GaveKal Capital
It is no secret that, whichever way we look at valuations, we think stocks are expensive. One of the more unique methodologies we employ to get a sense of where equity valuations are is to look at them grouped according to ‘buckets’ designated by pertinent levels.
2015-06-09 00:00:00 China’s Roaring Market by Edmund Harriss of Guinness Atkinson Asset Management
Chinese stock markets have roared in the past year, since May 2014. The Chinese government has announced a $40 billion “Silk Road” fund to build a network of railways and air links to bring China and Central Asia closer together; China launched the Asia Infrastructure Investment Bank in October 2014, and since then there has been a rush to join, not only from China’s neighbors, but also five of the G7 leading economies.
2015-06-08 00:00:00 Emerging Asia Pacific: Economy Trends Update -- April 2015 by Team of Thomas White International
During the first quarter, news from emerging Asia was dominated by the deep slowdown in China and its adverse impact on a host of other Asian economies, such as South Korea, Malaysia, Thailand, and Taiwan. In other developments, India grew faster than China, Korea saw a large decline in its exports, and Indonesia struggled to jumpstart its economy.
2014-12-29 00:00:00 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.
2014-12-27 00:00:00 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.
2014-12-23 00:00:00 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.
2014-12-22 00:00:00 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 00:00:00 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
2014-12-21 00:00:00 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 00:00:00 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.
2014-12-17 00:00:00 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.
2014-12-13 00:00:00 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.
2014-12-11 00:00:00 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 00:00:00 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.
2014-12-06 00:00:00 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
2014-12-01 00:00:00 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.
2014-11-24 00:00:00 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.
2014-11-23 00:00:00 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.
2014-11-22 00:00:00 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.
2014-11-19 00:00:00 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.
2014-11-14 00:00:00 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.
2014-11-11 00:00:00 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.
2014-11-10 00:00:00 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.
2014-11-04 00:00:00 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.
2014-10-31 00:00:00 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.
2014-10-28 00:00:00 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 00:00:00 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.
2014-10-24 00:00:00 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 00:00:00 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.
2014-10-23 00:00:00 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.
2014-10-21 00:00:00 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.
2014-10-20 00:00:00 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 00:00:00 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.
2014-10-19 00:00:00 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.
2014-10-17 00:00:00 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 00:00:00 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.
2014-10-16 00:00:00 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 00:00:00 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.
2014-10-14 00:00:00 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.
2014-10-13 00:00:00 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.
2014-10-09 00:00:00 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.
2014-10-07 00:00:00 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.
2014-10-06 00:00:00 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.
2014-10-03 00:00:00 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.
2014-10-01 00:00:00 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.
2014-09-30 00:00:00 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 00:00:00 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.
2014-09-29 00:00:00 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).
2014-09-22 00:00:00 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 00:00:00 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.
2014-09-19 00:00:00 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
2014-09-16 00:00:00 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.
2014-09-04 00:00:00 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.
2014-09-01 00:00:00 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.
2014-08-29 00:00:00 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
2014-08-27 00:00:00 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.
2014-08-15 00:00:00 The Fragmentation of Bretton Woods by Mohamed El-Erian of Project Syndicate
In recent years, political support for economic multilateralism has eroded, undermining the effectiveness of the Bretton Woods institutions and disrupting the international monetary system. This is not only hampering the global economys ability to meet its potential; it is also contributing to geopolitical insecurity.
2014-08-12 00:00:00 What a Credit-Shy Consumer Means for Growth by Kristina Hooper of Allianz Global Investors
Consumers have been cautious about running up credit-card debt since the financial crisis. But is that necessarily bad for the economy? Kristina Hooper breaks it down.
2014-08-06 00:00:00 What Asset Class Rallied Last Week amid the Sell-Off? by Luciano Siracusano III of WisdomTree
Last Thursdays sell-off in U.S. stocks (the Dow was down 317 points, the S&P 500 Index was down nearly 2%) marked the biggest stock market decline in nearly four months. The S&P 500 Index closed at 1,930 after it broke its 50-day moving average for the first time since April.
2014-08-05 00:00:00 Mixed Signals by Brian Andrew of Cleary Gull
Over the weekend I had the opportunity to take in baseball tryouts. I know you are thinking it is August so what tryouts would be taking place in the middle of the season? These tryouts were for U-8 boys. For the uninitiated, this is when boys aged 7 and younger try out for next seasons teams. My son spent two days at a baseball camp and then finished yesterday with team tryouts. During tryouts there were six stations covering the fundamentals of the game.
2014-08-05 00:00:00 Drawing Parallels Between Company Quality and Economic Strength by Francis Gannon of The Royce Funds
First-half results were mildly bullish, and included a brief period where higher-quality companies reasserted themselves during the more volatile months of April and early May. Co-Chief Investment Officer Francis Gannon talks about how the market has responded to the Fed's monetary stimulus, the economically sensitive characteristics that populate most of our firm's portfolios, and where we have been finding opportunities.
2014-08-05 00:00:00 So, What Did We Learn? by Scott Brown of Raymond James
The busy week of economic news left investors uneasy. The 4.0% GDP growth figure contributed to concerns that the Fed may be forced to raise short-term interest rates sooner rather than later. However, while the economic data reports, and even the Fed policy statement, had something for everybody, the outlook for monetary policy should be essentially unchanged.
2014-07-19 00:00:00 Bull Stumbles by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab
Any near-term correction would be healthy in the context of an ongoing secular bull market. Trying to time the market is always difficult, even though the market is in a potentially weak phase, both in terms of the annual and election cycles. And while sentiment is elevated in the United States, both Europe and China provide opportunities to invest where the mood is decidedly less enthusiastic.
2014-07-15 00:00:00 Flip Floppers Drive Stocks Lower by Kristina Hooper of Allianz Global Investors
In the course of one slow news week, stocks went from celebration to selloff. What changed? Not the strong economic data, says Kristina Hooper. Its a classic flip-flop from investors who had time to mull over recent numbers and change their minds.
2014-07-08 00:00:00 Blowout Jobs Data Wont Trigger Quicker Rate Hike by Kristina Hooper of Allianz Global Investors
The markets are digesting a stellar jobs report, which may fuel debate over when the Fed will start raising rates. But its important for investors to understand the Feds holistic approach in order to avoid a kneejerk reaction, writes Kristina Hooper.
2014-07-05 00:00:00 2014 Mid-Year Outlook Update: Living Actively Forecast Continues by Stephen Wood of Russell Investments
Does 2014 at mid-year remain a year of living actively for investors as outlined in Russells 2014 Annual Global Outlook issued last December? In that report, my colleagues on the global team of investment strategists agreed on the macro-view that 2014 would be better represented as a year of validation than a year of appreciation. And now, as we examine the underlying fundamentals in the macro- data at mid-year, I dont see a reason yet to alter our year of validation call.
2014-07-01 00:00:00 LPL Financial Research Mid-Year Outlook 2014: Investors Almanac Field Notes by Jeff Kleintop of LPL Financial
At this years halfway point, we are pleased to offer the LPL Financial Research Mid-Year Outlook 2014: Investors Almanac Field Notes containing key observations and updates to our outlook for 2014. Similar to a farming almanac, our Investors Almanac is a publication containing a guide to patterns, tendencies, and seasonal observations important to growing. The goal of farming is not merely to grow crops, but to sustain living thingsinvesting shares the same goal.
2014-06-24 00:00:00 A Mosaic Approach to Raising the Fed Funds Rate by Kristina Hooper of Allianz Global Investors
The Federal Reserve is using a wide swath of economic data and anecdotal evidence to determine when to raise its benchmark interest rate. While prudent, it may stir up anxiety and volatility for equity investors, writes Kristina Hooper.
2014-06-23 00:00:00 Will Small-Cap Stocks Close the Gap with Large-Caps? by Vadim Zlotnikov of AllianceBernstein
Small-cap stocks have lagged large-cap stocks by a substantial margin over the past few months, but a close look at the causes makes us think they could be in for a reversal of fortune.
2014-06-19 00:00:00 Mexicos Breakout Moment? by Mohamed El-Erian of Project Syndicate
Mexico has a good chance to realize its impressive structural-reform agenda. Doing so would give the rest of the world an important example of how such programs can be designed, implemented, and, most important, sustained until a critical mass of revitalized sectors and thus faster growth and greater prosperity is achieved.
2014-06-14 00:00:00 ECB Leaves the Door Open for Further Action by David Zahn of Franklin Templeton Investments
he European Central Bank (ECB) delivered a robust package of monetary policy measures on June 5 and promised more to come if needed to help stave off deflation and support the eurozones fragile economic recovery. Among the moves announced were interest rate cuts, including a negative interest rate on excess deposits that banks hold with the ECB, and new facilities to support bank lending to small businesses. We asked David Zahn, portfolio manager for the Franklin Global Government Bond Fund, for his thoughts on what these latest measures could mean for investors.
2014-06-13 00:00:00 ECB Leaves the Door Open for Further Action by David Zahn of Franklin Templeton Investments
The European Central Bank (ECB) delivered a robust package of monetary policy measures on June 5 and promised more to come if needed to help stave off deflation and support the eurozones fragile economic recovery. Among the moves announced were interest rate cuts, including a negative interest rate on excess deposits that banks hold with the ECB, and new facilities to support bank lending to small businesses. We asked David Zahn, portfolio manager for the Franklin Global Government Bond Fund, for his thoughts on what these latest measures could mean for investors.
2014-06-10 00:00:00 The Central Bank Divide: 3 Implications for Investors by Russ Koesterich of BlackRock
Major central banks are no longer moving in lockstep. While the Fed is pulling back, other central banks are maintaining very easy monetary policy. Russ explains three implications this new dynamic has for investors.
2014-06-07 00:00:00 Long-Term Opportunity in Tech Sector Volatility by Matthew Moberg of Franklin Templeton Investments
The technology sector seems to have again demonstrated just how frustrating markets can be. An investor favorite last year, the sector has been volatile in the first part of 2014, leading some to believe a tech bubble could be brewingor perhaps a slow leak has already begun. Matthew Moberg, portfolio manager for Franklin DynaTech Fund, says he doesnt pay much attention to semantics or speculation. Hes busy looking for companies that he believes have staying power and growth potential beyond temporary trends. And, he says hes using recent volatility as an opportunity
2014-05-29 00:00:00 China Sets America’s Mental Trap by Stephen Roach of Project Syndicate
It is often said that a crisis should never be wasted: Politicians, policymakers, and regulators should embrace the moment of deep distress and take on the heavy burden of structural repair. China seems to be doing that; America is not.
2014-05-28 00:00:00 Value Offers a Cushion: Why Last Years Winners Are Now Losers and Vice Versa by Russ of BlackRock
A trend in markets this year has been the poor performance of last years stock market winners, and the resilience of some of last years losers. Russ takes a look at whats behind this trend, specifically with retailers and emerging markets.
2014-05-27 00:00:00 Economy Begins to Accelerate While Equities Push Higher by Robert Doll of Nuveen Asset Management
U.S. equities finished higher last week as the S&P 500 advanced 1.3%, snapping a two-week losing streak and ending at a new record high. Markets seemed to lack conviction, but the path of least resistance appeared skewed to the upside as momentum for the economic recovery was positive.
2014-05-22 00:00:00 Russian Interests by Mark Mobius of Franklin Templeton Investments
Tensions between Russia and Ukraine remain high, and have spilled onto the international stage. The Western world seemed to be caught off guard by Russian President Putins reaction to civil unrest in Ukraine, leading to Russias annexation of Crimea and spreading into a broader question of regional sovereignty. The situation remains fluid, so its difficult to predict just exactly how it might play out. But given escalating conflict in Eastern Ukraine, we do not envision an easy or quick end to the conflict.
2014-05-21 00:00:00 Are Corporate Balance Sheets Really That Liquid? Debunking the "Cash Mountain" Myth by Team of GaveKal Capital
We frequently read about the "cash mountain" that has piled up on corporate balance sheets since the global financial crisis. In many cases the level of cash is given as evidence that the the non-financial corporate sector is stronger now than ever before.
2014-05-16 00:00:00 Concerned Optimism by Scott Brown of Raymond James
In her congressional testimony, Fed Chair Janet Yellen chose her words carefully. She indicated that if the economic outlook evolves as anticipated (growth picks up, the labor market tightens, and inflation moves toward the Feds 2% goal), then the Feds asset purchase program (QE3) will likely end in the fourth quarter. However, she refused to be pinned down on when the Fed would begin raising short-term interest rates. Global concerns and the housing sector will bear close observation.
2014-05-16 00:00:00 And That's The Week That Was by Ron Brounes of Brounes & Associates
Strike up the band! The Dow is now in positive territory for the year AND even set a record close. Who would have thunk that after the dismal January and the pessimism that reigned from the winter? The recovery continued as earnings season offered more surprises and the economic numbers show a country moving beyond the thaw of winter. Now if only China (Europe and Russia) could follow suit.
2014-05-15 00:00:00 Inequality Disaster Prevention by Robert Shiller of Project Syndicate
Thomas Pikettys impressive and much-discussed book Capital in the Twenty-First Century has brought considerable attention to the problem of rising economic inequality. But it is not strong on solutions.
2014-05-15 00:00:00 Thoughts on Investing in Convertible Securities by Alan Muschott of Franklin Templeton Investments
Changes and potential changes in monetary policy across the globe, along with increased volatility in currency and equity markets, have thrown a spotlight on convertible securities, described by some as offering the best of both worlds in terms of stock and bond characteristics. But what are they, how do they work, and how can they play a part in a diversified investment portfolio in todays market? Alan Muschott, portfolio manager for Franklin Convertible Securities Fund, who has been investing in convertible securities for more than a decade, provides his take.
2014-05-13 00:00:00 Equity Markets Remain Mixed as Fundamentals Slowly Improve by Robert Doll of Nuveen Asset Management
U.S. equities finished mixed last week as the Dow Jones Industrial Average was the only major index to end in positive territory. The overall macro narrative appears favorable despite the lack of market direction. Scrutiny of beaten-down momentum stocks resurfaced, although broader market spillover remained muted.
2014-05-09 00:00:00 Thoughts on Investing in Convertible Securities by Alan Muschott of Franklin Templeton Investments
Changes and potential changes in monetary policy across the globe, along with increased volatility in currency and equity markets, have thrown a spotlight on convertible securities, described by some as offering the best of both worlds in terms of stock and bond characteristics. But what are they, how do they work, and how can they play a part in a diversified investment portfolio in todays market? Alan Muschott, portfolio manager for Franklin Convertible Securities Fund, who has been investing in convertible securities for more than a decade, provides his take.
2014-05-06 00:00:00 The U.S. Economy Reached a Turning Point in April by Robert Doll of Nuveen Asset Management
U.S. equities finished higher last week with the S&P 500 advancing nearly 1.0%. Positive sentiment has been supported by growing traction for the economic recovery, key economic data and corporate commentary. Although the upbeat dynamics were mentioned in the latest FOMC statement, policy normalization expectations have not changed. Another widely discussed tailwind was M&A headlines. Although tensions continue in Ukraine, geopolitical risks were mostly on the back burner.
2014-04-25 00:00:00 A Creative Approach to Revitalize South Korea?s Economy by Mark Mobius of Franklin Templeton Investments
South Korea has been an exciting country to follow since Templeton started investing in emerging markets in 1987. The country represents one of the great success stories of the modern age, rising from extreme poverty at the end of the Korean War to become an affluent, democratic and highly technologically advanced country. However, we believe recent years have seen signs that the methods and structures that gave rise to the years of dramatic economic progress have started to lose their effectiveness.
2014-04-24 00:00:00 And That's The Week That Was by Ron Brounes of Brounes & Associates
After a week of panic, investors focused on the positives and went bargain hunting throughout. Thus far, earnings are not as bad as expected; Chinas woes could mean new stimulus; labor and manufacturing seem to be in full fledge thaw. Hope the holiday season brings more good news.
2014-04-22 00:00:00 Unloved Emerging Markets May Hold Value for Opportunistic Bond Investors by Kathleen Gaffney of Eaton Vance
· Emerging markets have come under pressure over the past year due to the Federal Reserve tapering its asset purchases and increased expectations of higher interest rates in the U.S. · We think investors should consider emerging markets to find opportunities that may provide a yield advantage and diversification away from U.S. interest-rate risk. · A multisector approach that uses bottom-up, fundamental credit analysis may be helpful in finding opportunities in emerging markets.
2014-04-14 00:00:00 Economic Insight: Fed Policy Goes Back to the Future by Thomas Luster of Eaton Vance
We fully expected the strength the economy showed in late 2013 to carry over into 2014; however, that simply was not the case. Instead, we saw weaker-than-expected economic data across a wide range of economic indicators. Not surprisingly, interest rates fell modestly during the quarter rather than continuing their trend higher from last year, while U.S. stocks (as measured by the S&P 500) reacted similarly ? barely advancing after a 32% gain in 2013.
2014-04-10 00:00:00 Shale Reserves Are No Shell Game by Matt Lloyd of Advisors Asset Management
Since the times of Ancient Greece, ?The Shell Game? has been a confidence trick used to convince bystanders into believing they have a legitimate shot at guessing correctly and doubling their bet. We are currently in one of the more transformational periods of energy consumption, distribution and discovery seen in some time. The technology of extracting once undiscovered pools of energy is reverberating throughout economies and potentially causing tectonic shifting of political structures.
2014-04-05 00:00:00 The Lions in the Grass, Revisited by John Mauldin of Millennium Wave Advisors
Today we explore a few things we can see and then try to foresee a few things that are not quite so obvious. The simple premise is that it is not the lions we can see lounging in plain view that are the most insidious threat, but rather that in trying to avoid those we may stumble upon lions hidden in the grass.
2014-03-31 00:00:00 Will Jobs Benefit From a Spring Thaw? by Kristina Hooper of Allianz Global Investors
The upcoming jobs report, a bellwether for the health of the US economy, could reveal that the harsh winter has created a coiled spring in the labor market, writes Kristina Hooper.
2014-03-29 00:00:00 Are You Being Advised or Sold To? by Rob Isbitts of Sungarden Investment Research
Independent advisors come in all shapes and sizes the ones who get it treat the client as a teammate, not an opponent, and see their role as being the clients advocate, representative, and interpreter, within an increasingly complex investment world. Shortcuts and overkill by Wall Street ?rms increase the chance of the clients later feeling fooled, and feeling like a fool. Independent ?rms will continue to be the winners in that battle for the clients affections because they are far less likely to allow that to happen.
2014-03-28 00:00:00 Johnson Controls: Back To Consistency? by Team of F.A.S.T. Graphs
Johnson Controls (JCI) traces its roots back to an interesting bit of history. One hundred and thirty-one years ago, Warren Johnson was a professor in Whitewater, Wisconsin. It was here that he invented and installed the first electric tele-thermoscope ? known today as the thermostat ? in his classrooms. The invention served a dual purpose: it kept his students more comfortable and put an end to the hourly interruptions from the janitor checking the rooms? temperature. Of course we can?t confirm this, but it would be our guess that Professor Warren was a regular student favorite.
2014-03-27 00:00:00 Real Estate Alpha Hides in Smaller Neighborhoods by Eric Franco of AllianceBernstein
After a spectacular five-year run, global real estate stocks look headed for a period of more normal returns. We think winning in this space will require a more discriminating eye?and venturing into the often neglected nooks and crannies of the smaller-cap real estate world.
2014-03-26 00:00:00 Unleashing Africa?s Potential by Michael Hasenstab of Franklin Templeton
Many investors who have never traveled in Africa probably have preconceived ideas about it, perhaps as a land of safaris and political strife, rich in coveted natural resources that have failed to bring widespread wealth and development to the continent. Many also might not realize how diverse the landscape, the economies and the people are on the continent, which boasts more than 1,000 languages spoken in more than 50 countries and climates ranging from hot deserts and tropical rainforests to frozen glaciers.
2014-03-24 00:00:00 Stocks Rise as Economic Backdrop Slowly Improves by Bob Doll of Nuveen Asset Management
U.S. equities finished higher last week, with the S&P 500 increasing 1.4%. Ukraine seemed to be receding in investors? minds. Despite the volatility and sharp increase in bond yields on Wednesday, the hawkish takeaways from the FOMC meeting were not a lingering overhang.
2014-03-21 00:00:00 The Global Economy?s Tale Risks by Robert Shiller of Project Syndicate
Fluctuations in the world?s economies are largely due to the stories we hear and tell about them. In Japan, "Abenomics" has created a powerful narrative of positive change, whereas the stories being told in other advanced countries are far scarier.
2014-03-18 00:00:00 Can the Fed Fend Off the Ides of March? by Kristina Hooper of Allianz Global Investors
Mid-March hasn?t been associated with much good luck in Europe historically. And with Ukraine mired in conflict, this year?s no different. But investors should resist the urge to react to geopolitical uncertainty and expect steady guidance from the Fed.
2014-03-17 00:00:00 And That's The Week That Was by Ron Brounes of Brounes & Associates
Remember when tiny Greece was a market mover? Well, now its tiny Crimea. With the growing global tensions and concerns about Crimeas secession from the Ukraine to Russia, investors chose to take a week off (for the most part) and take some equity profits, while moving back into the safe haven of treasuries. With little news on the domestic economic calendar, investors looked abroad and didnt care much for what they saw in China. (Still, the yuan must be better than the ruble these days.)
2014-03-12 00:00:00 High and Sustainable Profitability by William Smead of Smead Capital Management
To understand our third criteria for selecting stocks, you need to imagine athletes who have found the fountain of youth. Consider this: Robinson Cano has been one of the most consistently successful baseball players over the last ten years, and the Seattle Mariners just signed Cano to a 10-year contract for $240 million. Companies, however, don't have ten to twenty-year careers, because the average company in the S&P 500 Index lasts 50 years.
2014-03-10 00:00:00 With Fed in Charge, 5-Year Bull Run Poised to Continue by Kristina Hooper of Allianz Global Investors
The Federal Reserve?s loose monetary policy and gradual improvement in the economy are two big reasons the stock market can keep moving higher, says Kristina Hooper. Will it be reflected in this week?s consumer sentiment and spending data?
2014-03-04 00:00:00 A Century of Policy Mistakes by Niels Jensen of Absolute Return Partners
A century ago Argentina ranked as one of the wealthiest countries in world. Today it is a shadow of its former self. A long string of policy errors explain the long slide from riches to rags. Europe, like Argentina 100 years ago, is facing enormous challenges - as well as potential pitfalls - and the management of those challenges will define the welfare path for many years to come. Unfortunately, the early signs are not good. Our political leaders, afraid to face public condemnation, have so far chosen to ignore them.
2014-02-28 00:00:00 Bounce Back by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab
US stocks have bounced and the markets still attractive and in the midst of a secular bull market. But there are likely to be bumps along the way; notably given that this is a midterm election year; which are known for first-half pullbacks. A diversified portfolio is important and both European and Chinese stocks appear to have upside, while Japan continues to frustrate with a two-steps forward, two-steps back sort of approach. And a final reminder not to replace fixed income assets with equities in search of higher income without recognizing the risk profile of a portfolio has changed.
2014-02-25 00:00:00 Alternative Energy Brief by Edward Guinness of Guinness Atkinson Asset Management
This month we provide our Outlook for the Alternative Energy sector in 2014.
2014-02-20 00:00:00 February Flash Update by Clyde Kendzierski of Financial Solutions Group
It's too early to mean much, but so far out 2014 forecast is falling nicely into place. The market highs on Dec 31st have held, bonds are outperforming stocks, gold is outperforming both stocks and bonds, while gold mining shares are soaring! The anticipated volatility in emerging markets and Japan as well as the wild card of the Chinese economy continue to unfold, while bad weather has postponed the evidence of strong 2014 US growth.
2014-02-20 00:00:00 The Fed: Yellen's Tapering Tightrope by Milton Ezrati of Lord Abbett
In reducing quantitative easing, the Federal Reserve chairwoman faces a big challenge: preventing asset bubbles at home without pressuring developing economies.
2014-02-18 00:00:00 Market Outlook by Scotty George of Alexander Capital
The new thinking amongst market analysts is that one must respond to every news flash, every short-term nuance, any variable that creates a daily ripple in prices or attitude, or risk having your portfolio drift in obscurity and underperformance. The new "keeping up with the Jones" demands that we stay tuned to business news programming 24/7 to see if were conforming to expectations.
2014-02-15 00:00:00 The Economic Singularity by John Mauldin of Millennium Wave Advisors
Today, let’s think about central banks and liquidity traps and see if we agree that central bankers are driving the car from the back seat based upon a fundamentally flawed theory of how the world works. That theory helped produce the wreck that was the Great Recession and will have its fingerprints all over the next one.
2014-02-10 00:00:00 Growth and Policy Uncertainty Cause Choppy Markets by Bob Doll of Nuveen Asset Management
U.S. equities closed with modest gains last week, as the S&P 500 overcame Monday?s decline, the largest one-day percentage loss since June 2013. The weaker-than-expected ISM manufacturing and vehicle sales data drive the sell-off on Monday, exacerbating the focus on slowing momentum for the U.S. recovery. The impact of adverse weather complicates the picture. Also, although January non-farm payroll missed expectations, there were more upbeat indications for the household survey.
2014-02-10 00:00:00 Two Reasons for Value to Outperform in 2014 by Will Nasgovitz of Heartland Advisors
Weve seen the longest period of growth outperformance since 1932, but the two catalysts could cause value to return to favor. First, tapering by the Fed should allow interest rates to normalize and thereby benefit the Financials sector. Second, theres potential for a correction in the Consumer Discretionary sector, which appears overvalued: The groups P/E is above the historical average and performance has tracked upward despite flat earnings revisions.
2014-02-08 00:00:00 International Equity Commentary - December 2013 by Team of Thomas White International
International equity prices saw marginal gains in December as investors weighed the improved global economic outlook against the reduction in monetary stimulus from the U.S. Federal Reserve. Economic trends have become more positive across most regions, helped by the improving business environment and consumer sentiment in the U.S. as well as in Europe. Japan continues to see stronger export gains as demand revives in its major markets and the cheaper yen remain supportive.
2014-02-06 00:00:00 Stagnation by Design by Joseph Stiglitz of Project Syndicate
The difficulties that many rich countries now face are not the result of the inexorable laws of economics, to which people simply must adjust, as they would to a natural disaster. On the contrary, the decline in most households income over the past three decades, particularly in the US, is the result of flawed policies.
2014-02-05 00:00:00 Emerging Market Turmoil Creates January Decline by Bob Doll of Nuveen Asset Management
U.S. equities finished lower last week, as the S&P 500 ended January with the first monthly loss since August 2013 and the largest monthly decline since May 2012. A global retreat from risk has been sparked by unrest around the world, sell-offs in emerging markets led by a 20% decline in the Argentine peso, weaker than expected economic reports from China, U.S. economic growth concerns in light of frigid temperatures and anxiety over Fed tapering.
2014-02-05 00:00:00 2014 Market Outlook by Kevin Mahn of Hennion & Walsh
Some Bumps along the Road of Global Recovery
2014-02-05 00:00:00 The Importance of Taking a Long-Term Perspective by Jeffrey Knight of Columbia Management
For asset allocation decisions, we find great value in maintaining a long-term outlook for major asset classes. Twice a year, in fact, we conduct an extensive update of our five-year return forecasts for several asset classes. The purpose of this exercise is two-fold. First, taking a longer term perspective helps us to set strategic asset allocations and design portfolios for diverse investment goals.
2014-02-01 00:00:00 Central Banker Throwdown by John Mauldin of Millennium Wave Advisors
The Federal Reserve is signaling that it is going to end quantitative easing at some point in the future; therefore, investors are trying to find the exits before the end actually comes.
2014-01-30 00:00:00 The Path to Becoming an Emerging Market by Henry D'Auria, Morgan Harting of AllianceBernstein
Why have some equity markets in the developing world flourished more than others? Its a pivotal question for investors hoping to stake an early claim to the potential emerging-market (EM) success stories of the next decade.
2014-01-29 00:00:00 Watching the Polar Bear by Jerry Wagner of Flexible Plan Investments
With temperatures hovering around zero and wind chills in the negative teens, I cant think of any better label for Fridays stock market sell off than a "polar bear". Here in Michigan at the Detroit Zoo, one of the nations finest, we have a rather unique polar bear exhibit. Visitors to the zoo can actually walk through tunnels interspersed throughout the polar bear environment created in the exhibit. At one point you are underneath the big furry creatures as they swim about. It is a beautiful sight.
2014-01-28 00:00:00 Emerging Market Issues Weigh on U.S. Equities by Bob Doll of Nuveen Asset Management
U.S. equities finished lower last week as the S&P 500 declined 2.6% and suffered the largest weekly pullback since June of 2012. U.S. stocks are down approximately 3.0% both year to date and from all-time highs. In 2014, lack of direction in the market has been a focus, and the waning influence of macroeconomic news caused a notable shift late last week.
2014-01-28 00:00:00 Commodities In 2014: Supply Remains A Concern by Doug Ramsey of Leuthold Weeden Capital Management
If a reacceleration of EM demand for raw materials were imminent, one would think the MSCI BRIC Index would be the first to sniff it out. Yet that index remains among the poorest performing market composites in the world. Still, commodity demand will eventually right itself. Our worry is supply. Capital spending levels remain elevated, and are far above the levels seen just over a decade ago-on the eve of Chinas great commercial and residential construction boom. Commodity producers didnt anticipate that boom, which is precisely why it was so powerful.
2014-01-23 00:00:00 Economic Growth is Likely to Improve in 2014 by Derek Hamilton of Ivy Investment Management Company
We believe a global economic upturn is likely in 2014, although the overall growth rate will remain sluggish. We think developed countries will show the largest improvement, which in turn will help support growth rates in emerging markets.
2014-01-21 00:00:00 Achieving Escape Velocity by Mohamed El-Erian of Project Syndicate
While the prospect of faster global GDP growth in 2014 is good news, it is too early to celebrate. Indeed, there is a risk that, by tempting policymakers into complacency, this years economic upturn could even end up being counterproductive.
2014-01-21 00:00:00 Digging for Natural Resource Opportunities in 2014 by Frederick Fromm, Stephen Land, Matthew Adams of Franklin Templeton
The natural resources sector has been through a period of transition in the past year, one which has pushed many companies toward cost reduction and greater capital discipline amid an environment of rather sluggish global economic growth. Franklin Equity Group Analysts Fred Fromm, Stephen Land and Matthew Adams think an improving economic outlook could set the stage for potentially stronger commodity demand going forward, and see healthy potential demand growth for energy in particular. They share their outlook for the natural resources sector in 2014, and where they are finding opportunities.
2014-01-18 00:00:00 Forecast 2014: 'Mark Twain!' by John Mauldin of Millennium Wave Advisors
The surface of the market waters looks smooth, but the data above suggest caution as we proceed. Perhaps slowing the engine and taking more frequent soundings (or putting in closer stops!) might be in order. The cry should be "Mark twain!" Let’s steam ahead but take more frequent readings and know that a course correction may soon be necessary.
2014-01-17 00:00:00 Digging for Natural Resource Opportunities in 2014 by Frederick Fromm, Stephen Land, Matthew Adams of Franklin Templeton
The natural resources sector has been through a period of transition in the past year, one which has pushed many companies toward cost reduction and greater capital discipline amid an environment of rather sluggish global economic growth. Franklin Equity Group Analysts Fred Fromm, Stephen Land and Matthew Adams think an improving economic outlook could set the stage for potentially stronger commodity demand going forward, and see healthy potential demand growth for energy in particular. They share their outlook for the natural resources sector in 2014, and where they are finding opportunities.
2014-01-16 00:00:00 A Flight to Quality by Ben Fischer of Allianz Global Investors
CIO NFJ Ben Fischer delivers his 2014 outlook, focusing on the Feds tapering of its bond-buying program and how high-quality, dividend-paying stocks should respond.
2014-01-15 00:00:00 The Haves and the Have Nots by Scott Migliori of Allianz Global Investors
CIO Equity US Scott Miglioris 2014 outlook calls for moderate growth, an accommodative Fed and a stock-pickers market, favoring areas of the economy that are insensitive to growth.
2014-01-15 00:00:00 Investment Insights from a Road Warrior by Frank Holmes of U.S. Global Investors
As part of our investment process, we often take the explicit knowledge learned from our statistical models and overlay them with global travel.
2014-01-13 00:00:00 Stocks Rise Modestly in First Full Week of Trading by Bob Doll of Nuveen Asset Management
U.S. equities finished mostly higher for the first full week of the year, with the S&P 500 gaining approximately 0.6%. There were no meaningful directional drivers behind the price action, which is a dynamic that has been prevalent so far in 2014.
2014-01-09 00:00:00 The Year Ahead - 2014 by Mark Ungewitter of Charter Trust Company
In the spirit of year-end prognostication, heres my annual review of secular trends and historic behaviors that are likely to influence key markets in 2014.
2014-01-08 00:00:00 Rehab World by Niall Ferguson of Project Syndicate
The late English chanteuse Amy Winehouse sang, "They tried to make me go to rehab, but I said No, no, no." Perhaps 2013 should be known as the year of Winehouse economics, with the singers being the worlds most important central banks, led by the Federal Reserve.
2014-01-08 00:00:00 When the QE Tide Recedes, Focus on What is Revealed by Robert McConnaughey of Columbia Management
While there is fierce debate on the ultimate effectiveness of monetary stimulus surging from the central banks, one cannot dispute the boost that it has given to asset prices. While we may be seeing some "green shoots" of overall growth pick-up in the developed world, the post-crisis recovery in asset values has not been primarily driven by economic or earnings growth. Instead, we have been in a high correlation environment where the rising tide lifted most diversified investor boats as repressed "risk-free" rates pushed money out into riskier asset classes.
2014-01-07 00:00:00 The World of Thinking Machines by Bill O'Grady of Confluence Investment Management
The New York Times recently published an article that discussed a new version of a computer chip that will be released later this year that is expected to automate tasks that currently require direct programming. In this report, we will open with an examination of the philosophy of learning. We will then discuss the potential dangers of such machines, including the ability to perform humanlike actions without a moral sense. We will also examine the potential economic and social side effects. As always, we will conclude with potential market ramifications.
2014-01-04 00:00:00 Forecast 2014: The Human Transformation Revolution by John Mauldin of Millennium Wave Advisors
It is that time of the year when we peer into our darkened crystal balls in hopes of seeing portents of the future in the shadowy mists. This year I see three distinct wisps of vapor coalescing in the coming years. Each deserves its own treatment, so this year the annual forecast issue will in fact be three separate weekly pieces.
2014-01-02 00:00:00 The World Economy's Shifting Challenges by George Soros of Project Syndicate
As 2013 comes to a close, efforts to revive growth in the worlds most influential economies are exerting competing pressures on the global economy. Perhaps not surprisingly, while Europe and the US will continue to play an important global role, developments in Asia will determine the worldwide outlook in 2014 and beyond.
2013-12-31 00:00:00 Tech Bubble Circa 1999, or Something Different? by J.P. Scandalios of Franklin Templeton
Technology sector stocks have been investor favorites in 2013, pushing the tech-heavy Nasdaq Composite Index to its highest level since 1999 and drawing comparisons to the "dot com" bubble which burst soon thereafter. Will we see a redux of the tech bust in 2014? John P. Scandalios doesnt think so. Investor fever for anything "dot com" in the late 1990s was built more on promise than actual results.
2013-12-26 00:00:00 A Strong Finish for 2013 by Bob Doll of Nuveen Asset Management
For our weekly subscribers, we wanted to take an opportunity to look back on the year. We began 2013 with an outlook for the prospect of improvement for the global economy and risk assets. We thought global policymakers unprecedented attempts to reflate global growth would show some signs of bearing fruit, especially in the United States and China. In our forecast, equity markets would continue to be choppy in light of the fiscal cliff issues, but an inevitable political compromise would reduce the economic drag.
2013-12-24 00:00:00 Fed Taper Brings Us Back to the Future by Kristina Hooper of Allianz Global Investors
A return to normal economic conditions is now more palpable following the Feds decision to start unwinding QE and early signs of a revival in consumer spending, growth and jobs, writes Kristina Hooper.
2013-12-23 00:00:00 Risk Assets Take Fed Taper Announcement in Stride by Roger Bayston of Franklin Templeton
The US Federal Reserve (Fed) delivered an early holiday surprise to some market participants, announcing at its December 18 policy meeting it would start slowing its asset purchase program known as quantitative easing in January. For some thoughts on what this may mean for the markets in the new year, we turned just after the announcement to Roger Bayston. He believes the markets should be able to take the Feds tapering in 2014 in stride, although investors should prepare for the proposition of higher Treasury yields.
2013-12-21 00:00:00 What Has QE Wrought? by John Mauldin of Millennium Wave Advisors
Now that we have begun tapering, we will soon see lots of analysis about whether QE has been effective. What will the stock market do? The US economy seems to be moving in the right direction, but the Fed has forecast Nirvana (seriously) - do we dare hope they can finally get a forecast right? Or have they jinxed us?
2013-12-18 00:00:00 Three Investments that Could Return to Favor in 2014 by Jeffrey Knight of Columbia Management
When investors lose confidence in an asset class, especially one that had been popular enough to attract outsized allocations, subsequent rebalancing generally leads to prolonged periods of underperformance. Technology stocks after 1999, for example, underperformed the S&P 500 in eight of the next 10 years and by a cumulative total of more than 40 percentage points. Today, many believe that interest rate sensitive bonds might have just begun a similar era of waning investor confidence, portfolio reallocation and underperformance.
2013-12-17 00:00:00 5 Takeaways from the Mini-Budget Deal by Kristina Hooper of Allianz Global Investors
The bi-partisan budget agreement inked last week has real implications for investors, including its impact on consumers, the stock market and the Fed, writes Kristina Hooper.
2013-12-12 00:00:00 Payment Industry - Follow the Money by Team of Baird Investment Management
The substantial growth in credit and debit card usage is a multi-decade trend driven by increased global consumer activity and a shift in behavior to less transactions completed by cash or check. As the buzz of the holiday season takes hold, consumers wouldnt think twice about leaving home with just a debit or credit card in hand. The simple act of a purchase followed by swiping a plastic card occurs a staggering several hundred million times each day, with a step up in activity during the holiday season.
2013-12-12 00:00:00 Looking Back 40 Years, What Can We Learn About This Current Corporate Debt Market? by Matt Lloyd of Advisors Asset Management
I recently wrote a blog post detailing the potential opportunity in municipals as it has historically rebounded after a negative total return. Accordingly, I have been asked if this pattern was representative in the investment grade corporate arena.
2013-12-11 00:00:00 What Will 2014 Bring for The Equity Markets? by Marco Pirondini of Pioneer Investments
As the year draws to a close, investors are searching for clues as to what may be in store for the economy and markets in 2014. What have we learned from the markets in the month of November? Honestly, not very much. The scenario has not changed much in the last 30 days.
2013-12-09 00:00:00 America's Partisan Peril by Mohamed El-Erian of Project Syndicate
Many Americans started 2013 with high hopes that congressional leaders would overcome, even if only partly, the polarization and political dysfunction that had slowed recovery. But optimism foundered over the course of 2013, while frustration soared.
2013-12-07 00:00:00 Interview with Steve Forbes by John Mauldin of Millennium Wave Advisors
For whatever reason, Steve Forbes seems to bring out the passion in me. When I think about what central bank policies are doing to savers and investors, how we are screwing around with the pension system, circumventing rational market expectations because of an untested economic theory held by a relatively small number of academics, I get a little exercised. And Steve gives me the freedom to do it.
2013-12-04 00:00:00 What's the Problem With Advanced Economies? by Kenneth Rogoff of Project Syndicate
Is todays slow growth in advanced economies a continuation of long-term secular decline, or does it reflect the normal aftermath of a deep systemic financial crisis? Fortunately, we do not need to answer that question definitively in order to boost the pace of economic recovery.
2013-12-03 00:00:00 Looking Out on the Horizon for Equities by Bob Doll of Nuveen Asset Management
U.S. equities finished higher for an eighth consecutive week as the S&P 500 increased 0.1%, representing the longest positive streak since 2004. Inertia may have carried markets forward in a relatively quiet trading week without major headlines. Retail news appeared fairly positive in anticipation of a strong start to the Thanksgiving shopping weekend. Economic data was mixed.
2013-11-28 00:00:00 Five Reasons Inflation Is Still Missing by Chun Wang of Leuthold Weeden Capital Management
Apart from a couple of market-oriented drivers that could reverse course on a short-term basis, we are not seeing convincing evidence of an imminent pick-up in inflation. Let us be clear. There is most definitely inflation in the financial markets, but that does not seem to benefit the average person in the U.S. The liquidity injected by various central banks went mostly into the financial markets first and foremost; only a small fraction of it trickled down to the average person. That is why all this money printing has not been reflected in various inflation measures.
2013-11-25 00:00:00 Solving the Income Puzzle by Christopher Remington, Michael Cirami, Kathleen Gaffney, Scott Page of Eaton Vance
Income needs may be as high as they’ve ever been, while the yield potential from many traditional investment classes has dwindled to generational lows. Investors who remain in high-priced, low-yielding core bond strategies could experience loss of principal (and mounting retirement shortfalls) if interest rates revert toward their mean. We advocate creating an integrated, multi-pronged income plan that may offer yield potential that meets investor needs, while managing key risks found in the typical core fixed-income allocation.
2013-11-24 00:00:00 Game of Thrones - European Style by John Mauldin of Millennium Wave Advisors
The Eurozone crisis is not over, and it will not end quickly or soon. Even if it seems to unfold in slow motion - like the slow build-up in a Game of Thrones storyline to violent internecine clashes followed by more slow plot developments but never any resolution, the Eurozone debacle has never really gone away. The structural imbalances have still not been fixed; politicians and central bankers have still not agreed to solve major fiscal problems; the overall economy still disintegrates; unemployment is staggeringly high in some countries and still rising; and the people are growing restless.
2013-11-22 00:00:00 What is the Current Market Reality? by Giordano Lombardo of Pioneer Investments
At this years Global Investment Forum, the discussion among Pioneer investment professionals was generally positive. Of course, everyone was conscious of the current market reality: that the major force behind recent positive, though benign, market trends is the unprecedented creation of liquidity and extremely loose stance of monetary policies around the world. Monetary policy alone cannot be the only conduit to a new economic model of income growth and job creation.
2013-11-19 00:00:00 A Glimpse of a Yellen-Led Fed by Kristina Hooper of Allianz Global Investors
Kristina Hooper highlights some key takeaways from incoming Federal Reserve chair Janet Yellens testimony before the Senate last week, including when the Fed is likely to taper its bond-buying program.
2013-11-17 00:00:00 The Unintended Consequences of ZIRP by John Mauldin of Millennium Wave Advisors
Two recently released papers make an intellectual and theoretical case for an extended period of very low interest rates and, in combination with other papers from both inside and outside the Fed from heavyweight economists, make a strong case for beginning to taper sooner rather than later, but for accompanying that tapering with a commitment to an even more protracted period of ZIRP. We are going analyze these papers, as they are critical to understanding the future direction of Federal Reserve policy. Secondly, we’ll look at some of the unintended consequences of long-term ZIRP.
2013-11-14 00:00:00 In 20 Years, What Country Will Produce the Most Gold? by Frank Holmes of U.S. Global Investors
A question like that is impossible to answer, of course, due to mining difficulties, diminishing resources, and changing government policies and regulations that help or hinder a countrys ability to mine, farm or drill efficiently.
2013-11-14 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management
Here in the United States, we had local and regional elections last Tuesday. Several of the ballot initiatives, and many of the candidates, addressed what has commonly been phrased as the inequality gap. To be sure, in an ideal world, everyone has access to, and participation in, the bounty that this country has to offer. From sea to shining sea we do have a plentitude of idea-makers and resources available.
2013-11-12 00:00:00 Markets Vacillate Between Stronger Economy and Fed Accommodation by Bob Doll of Nuveen Asset Management
U.S. equities finished mostly higher last week as the S&P 500 increased 0.6%, ending higher for the fifth straight week. The return of central bank action was a primary concern. The European Central Bank (ECB) surprised investors with a 0.25% rate cut, while the debate over the Federal Reserves impending tapering decision continued in earnest.
2013-11-01 00:00:00 Risk Management: An Ounce of Prevention by Seth Masters, Daniel Loewy, Martin Atkin of AllianceBernstein
They say an ounce of prevention is worth a pound of cure. But if the sickness is excessive portfolio volatility, prevention can entail more than one step.
2013-10-30 00:00:00 Getting Back into Value Equities by Kevin Simms of AllianceBernstein
It finally feels like a great time to be a value investor again. After several challenging years, market conditions have become much more conducive to finding undervalued, controversial stocks with long-term payoff potential. Even after this years equity-market rally, we think the value rebound is just beginning.
2013-10-28 00:00:00 Beyond the Noise, More of the Same? by Scott Brown of Raymond James
Delayed economic data reports have begun to arrive. The figures point to a disappointing 3Q13 (relative to expectations) and the partial government shutdown is unlikely to help in 4Q13. The recovery had been poised for improvement this year, but fiscal policy has been a major headwind. Economic figures will be distorted in October (due to the government shutdown) and in November (due to the rebound from the shutdown). Yet, beyond the noise, the underlying pace of growth is likely to remain disappointing in the near term. Is there hope for 2014?
2013-10-26 00:00:00 A Code Red World by John Mauldin of Millennium Wave Advisors
The heart of this week’s letter is the introduction of my just-released new book, Code Red. It is my own take (along with co-author Jonathan Tepper) on the problems that have grown out of an unrelenting assault on monetary norms by central banks around the world.
2013-10-26 00:00:00 Why U.S. Dollar Will Remain World's Reserve Currency, Despite Political Brinkmanship by Tatjana Michel of Charles Schwab
The U.S. dollar is not likely to lose its premier world reserve-currency status anytime soon. But continuing U.S. political brinkmanship could drive foreign countries into other currencies faster. With the market focus shifting to monetary policy and growth, we expect a Fed taper delay to give foreign currencies some time to recover.
2013-10-23 00:00:00 Investment Bulletin: Global Equity Strategy by Team of Bedlam Asset Management
The portfolio enjoyed another index-beating month with a gain of 0.9% versus 0.6%, so improving further the long term numbers. As noted in previous Bulletins, correlations between growth and equity market returns are low. Investors remain fixated otherwise, but some confusion is reasonable given that growth in earnings per share is also slowing. Yet strong equity markets can be justified by the Free Lunch Theory.
2013-10-22 00:00:00 Washington Strikes a No-Surprise Deal - Now What? by Sam Wardwell of Pioneer Investments
Congress called a time-out in the budget/debt fight last week, striking a deal to avoid default and fund the U.S. government through January 15, 2014 and raise the debt limit through February 7, 2014. While the parties agreed to budget talks, they did not commit to reaching an agreement (technically, Paul Ryan and Patty Murray, the House and Senate budget committee chairs will begin a process of fiscal negotiations, due to wrap up by mid-December).
2013-10-21 00:00:00 Fourth Quarter Investment Outlook by Bob Doll of Nuveen Asset Management
The macro theme of the fourth quarter and early 2014 is monetary reflation and global growth resynchronization. The Feds surprising decision to postpone tapering its QE program will likely encourage further risk-taking. In the meantime, we observe increasing signs of a synchronized improvement among the four important economies - the United States, Europe, Japan and China.
2013-10-21 00:00:00 Europe Turning a Corner? by Brandon Odenath of J.P. Morgan Funds
Since late last year, investors have seen periods of strong outperformance by assets from the most impacted parts of Europe, leaving many observers wondering if Europe is turning a corner. Intervention by the ECB and the ability of those liquidity injections to stop the bleeding in the economy has helped. The reduction of austerity and drag coming from fiscal policy should be the key to faster economic growth.
2013-10-20 00:00:00 The Damage to the US Brand by John Mauldin of Millennium Wave Advisors
There is no doubt that the image what I will refer to in this letter as the "brand" of the United States has been damaged in the past month. But what are the actual costs? And what does it matter to the average citizen? Can the US recover its tarnished image and go on about business as usual? Is the recent dysfunction in Washington DC now behind us, or is it destined to become part of a bleaker landscape?
2013-10-12 00:00:00 Sometimes They Ring a Bell by John Mauldin of Millennium Wave Advisors
Three items have come across my screen in the past month that, taken together, truly do signal a major turning point in how energy is discovered, transported, and transformed. And while we’ll start with a story that most of us are somewhat aware of, there is an even larger transformation happening that I think argues against the negative research that has come out in the last few years about the reduced potential for growth in the world economy.
2013-10-08 00:00:00 Listen to the 10th Man by Kristina Hooper of Allianz Global Investors
Theres no shortage of short-term risks in todays market or conventional wisdom on how they will play out. But prepping for the unexpected could limit the number of surprises and better insulate investors portfolios, writes Kristina Hooper.
2013-10-04 00:00:00 Government Shutdown and Beyond by Team of Neuberger Berman
After months of eerie quiet in Washington, DC, fiscal conflicts have taken center stage, most prominently with the October 1 "shutdown" of U.S. government services. Markets are nervously watching if Congress can move past current wrangling to create a workable budget while navigating both the debt ceiling and shutdown-related fallout. In this issue of Strategic Spotlight, we consider how the budget debates could play out and the implications for investors.
2013-10-02 00:00:00 And That's The Week That Was by Rob Brounes of Brounes & Associates
Move over Ben BernankeTed Cruz has the floor. (Somehow investors seem more interested when Dr. B speaks.) With politicos facing debates on debt ceilings and budget funding, few have confidence that they can act reasonably and with compromise (and the Cruz debacle did not help matters). Stocks fell over five consecutive days as portfolio managers set up positions for the next quarter. Labor and manufacturing releases highlight a hectic week on the economic calendar, but shenanigans from DC may steal the headlines.
2013-09-28 00:00:00 The Renminbi: Soon to Be a Reserve Currency? by John Mauldin of Millennium Wave Advisors
Contrary to the thinking of fretful dollar skeptics, my firm belief is that the US dollar is going to become even stronger and will at some point actually deserve to be the reserve currency of choice rather than merely the prettiest girl in the ugly contest the last currency standing, so to speak. But whether the Chinese RMB will become a reserve currency is an entirely different question.
2013-09-27 00:00:00 Read My Lips... by Dimitri Balatsos of Tesseract Partners
Chairman Ben Bernankes press conference this week, commenting on the decision by the Federal Open Market Committee (FOMC) not to taper, reminded us of the famous slogan of Presidential hopeful George H.W. Bush at the 1988 Republican National Convention Read my lips: no new taxes. Yet, after he won the election, he raised taxes in an effort to reduce the public deficit.
2013-09-25 00:00:00 More Than a Sugar High by Pamela Rosenau of HighTower Advisors
The recent decision by the Fed to delay any tapering may be a preview of what to expect by a Yellen Fed. As the Fed appeared to remove virtually every yardstick or goal post that they have provided recently, one thing is certain, they seem determined to keep the accelerator nailed to the floor as they drive the economy at full speed. According to Cornerstone Macro, based on the Feds move, it appears increasingly likely that growth is more likely to reaccelerate.
2013-09-23 00:00:00 America's Labor Market by the Numbers by Mohamed El-Erian of Project Syndicate
Net monthly job creation in the US was up in August, while unemployment was down. But, to get a real sense of the American labor markets health, we need to look at other indicators, and what these numbers have to tell us about both the present and the future is far from reassuring.
2013-09-23 00:00:00 Post Fed, Expect More Surprises by Kristina Hooper of Allianz Global Investors
Kristina Hooper says investors should brace for more big market swingsand some fiscal curveballsin the wake of the FOMCs decision not to taper in September. But the economy is throwing some good surprises our way too.
2013-09-21 00:00:00 Rich City, Poor City by John Mauldin of Millennium Wave Advisors
This week we will conclude our look at pension plans for the nonce with a 30,000-foot overview of the states and then take a deeper dive into one city: mine. This will give you at least one version of how to do your own homework about your own hometown. But fair warning, depending on your locale, you may need medical help or significant quantities of an adult beverage after you finish your research.
2013-09-20 00:00:00 Will Europe's Improving Economy Push Interest Rates Higher by Giordano Lombardo of Pioneer Investments
Gross Domestic Product (GDP) increased in the second quarter after six straight declines. Data expectations were on the optimistic side, but investors appeared to become more confident before the release, thanks to encouraging evidence from supposedly reliable forward-looking indicators.
2013-09-20 00:00:00 Companies Can Do More to Unlock Shareholder Value by Kurt Feuerman of AllianceBernstein
As the global recession and financial crisis move further back in the rearview mirror, companies have been more proactive about using their balance sheets in ways that enhance shareholder value. But we think they can do a lot more.
2013-09-18 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management
Depending upon where you reside, or on which side of the issues you fall, it was a good week last week. We averted a military strike on Syria by the U.S., at least temporarily; we had reasonable adjustments to economic growth statistics; and most made some money in their portfolios. While cyclical dynamics are relatively benign, the broader secular outlook continues to build a solid foundation for recovery.
2013-09-17 00:00:00 The Upside of Low Expectations by Kristina Hooper of Allianz Global Investors
The stock market has benefited from a pessimistic outlook recentlyand so could the consumer, writes Kristina Hooper.
2013-09-10 00:00:00 The Party's Over. Why Own Commodities? by Jon Ruff, Seth Masters of AllianceBernstein
Commodity prices soared during the first decade of this century. But now the partys over: new sources of supply are coming on line just as demand from China is slowing, leading to expectations of price declines. So should investors shun commodity-related investments?
2013-09-09 00:00:00 The Shape of Things to Come by Kristina Hooper of Allianz Global Investors
With a week to go before the September FOMC meeting, theres little that stands in the way of Fed tapering. Fridays jobs report didnt impress but it probably wasnt bad enough to stop central bankers from pulling some punch, writes Kristina Hooper.
2013-09-07 00:00:00 Unrealistic Expectations by John Mauldin of Millennium Wave Advisors
Two well-respected analysts of pension funds have produced reports this summer suggesting that pensions are now underfunded by more than $4 trillion and possibly more than $5 trillion. I would like to tell you that the underfunding is all the bad news, but when you probe deeper into the problems facing pension funds, it just gets worse.
2013-08-31 00:00:00 How Do I Hate Thee? by John Mauldin of Millennium Wave Advisors
I will list a number of reasons why I hate this market and then suggest a few reasons why that should get you excited. We will look at some charts, and I’ll briefly comment on them. No deep dives this week, just a survey of the general landscape.
2013-08-28 00:00:00 On Tapering, All Signs Point to “Maybe” by Scott Brown of Raymond James
Investors looking to the July 30-31 Fed policy meeting minutes for clear clues on future moves were left disappointed. Nearly all senior Fed officials expect that a reduction in the pace of asset sales is likely to be warranted by the end of the year. However, they appear evenly divided on whether that will be sooner (September) or later (December). The economic data remained mixed, suggesting that the decision will be a close call.
2013-08-26 00:00:00 The Case for More Mortgage QE by Kristina Hooper of Allianz Global Investors
Disappointing new home sales dont mean that tapering is less likely to occur in September. Rather, it may only mean that when tapering begins, the Feds likely to start small and only trim Treasuries.
2013-08-25 00:00:00 France: On the Edge of the Periphery by John Mauldin of Millennium Wave Advisors
Charles de Gaulle said that "France cannot be France without greatness." The current path that France is on will not take it to renewed greatness but rather to insolvency and turmoil. Is France destined to be grouped with its Mediterranean peripheral cousins, or to be seen as part of the solid North Atlantic core? The world is far better off with a great France, but France can achieve greatness only by its own actions.
2013-08-19 00:00:00 What's the Point of Investing in Dreams? by Vadim Zlotnikov of AllianceBernstein
Is innovation dead or are we on the cusp of new technological revolutions? Without resolving this epic debate, we believe that market conditions today are conducive to investing in companies with disruptive potential, but it takes a sober approach to find big dreams that can deliver big returns.
2013-08-17 00:00:00 Signs of the Top by John Mauldin of Millennium Wave Advisors
The investment media seems obsessed with the question of whether the Fed will taper. The real question should be not about "tapering" but about credibility. What happens when fundamentals become the narrative as opposed to what the central bank is doing? What happens if the Federal Reserve throws a liquidity party and nobody comes? Today we look at some of the fundamentals. The market is in fact overvalued, but that doesn’t mean it can’t become more overvalued. Is this August 1987 or August 1999?
2013-08-13 00:00:00 So Now What? by Scott Brown of Raymond James
What did we learn last week? The Fed may not be in any hurry to begin reducing the rate of asset purchases. The economic data suggest a mixed picture.
2013-08-10 00:00:00 We Can't Take the Chance by John Mauldin of Millennium Wave Advisors
What would it have been like to be a central banker in the midst of the crisis in 2008-09? You’d know that you won’t have the luxury of going back and making better decisions five years later. Instead, you have to act on the torrent of information that’s coming at you, and none of it is good. Major banks are literally collapsing, the interbank market is nonexistent and there is panic in the air. Perhaps you feel that panic in the pit of your stomach. This week we’ll perform a little thought experiment to see if we can extrapolate what is likely to happen in when the nex
2013-08-08 00:00:00 Dcf Vs. Multiples by Kurt Havnaer of Jensen Investment Management
Valuing a stock is arguably one of the investment managers most difficult tasks. A variety of tools and methodologies exist to value equities, and the assumptions used in those are estimates of future unknowns. According to Aswath Damodaran, a valuation expert and finance professor at New York University, multiples are the most common method used by investors to value stocks.
2013-08-08 00:00:00 Coming Soon: September Volatility by Russ Koesterich of iShares Blog
Since spiking earlier this summer, market volatility is now back to spring lows. Investors, however, shouldnt expect this calm to continue come September. Russ has four reasons why.
2013-08-06 00:00:00 The Changing of the Monetary Guard by Joseph Stiglitz of Project Syndicate
With leadership transitions at many central banks under way, many of those who were partly responsible for creating the global crisis that erupted in 2008 are departing to mixed reviews. The main question now is the extent to which those reviews influence their successors behavior.
2013-08-06 00:00:00 Equities Grind Higher as the Economy Continues to Muddle Through by Bob Doll of Nuveen Asset Management
U.S. equities advanced last week, with the S&P 500 increasing 1.10%.1 For the month of July, the S&P gained 5.09%, and equities have increased 21.33% year to date. Second quarter earnings season is nearly complete, and there has not been a material change in estimated earnings for the balance of the year or 2014. Revenues were slightly ahead of expectations, and earnings per share were approximately 3% higher than expected, annualizing at about $110 per S&P 500 share.
2013-08-02 00:00:00 Stock Forecast: Positive With a Chance of Rally? by Frank Holmes of U.S. Global Investors
The S&P 500 Index closed the month of July with a 4.9 percent gain. What does this increase mean for the next few weeks and following three months? Research suggests markets continue to rally.
2013-08-02 00:00:00 3 Reasons Silver Is Not the Same As Gold by Russ Koesterich of iShares Blog
Many investors who remain cautious on gold wonder whether they should get their precious metal exposure through silver instead. In response, Russ explains why the two metals arent interchangeable.
2013-08-01 00:00:00 July 2013 Market Commentary by Andrew Clinton of Clinton Investment Management
Fixed income investors have enjoyed a steady move higher in bond prices over the past five years. Given the consistency with which bond values have increased, it is understandable if bond investors were surprised by the just over 0.60%, or 60 basis point rise in ten year Treasury yields and corresponding movement down in bond prices during the second quarter.
2013-07-30 00:00:00 Leuthold's Chun Wang on 10-year Rates by Chun Wang of Leuthold Weeden Capital Management
So now the question is how high can it go? Just like every other market, bond yields tend to overshoot, and we think 3% is the upper bound in the short-term. However, we believe it will settle back closer to 250 bps by the end of the year.
2013-07-26 00:00:00 Wedding Bells in Romania by Mark Mobius of Franklin Templeton Investments
I was invited to attend the wedding of one of our Romanian staff in June, and I jumped at the opportunity to celebrate with the happy couple, visit a different part of Romania, and talk to locals about life there. The celebration represented a microcosm of the juxtaposition of old and new in Romania, and this is similar for investors there as progress continues toward market reform.
2013-07-24 00:00:00 Earnings Acceleration Likely Needed for Next Upturn in Stocks by Bob Doll of Nuveen Asset Management
U.S. equities finished mostly higher last week. For a fourth straight week, the S&P 500 and Dow Jones Industrials were up (returning 0.73% and 0.57% respectively for the week), while the NASDAQ underperformed at -0.34%. It was a busy start for second quarter earnings. More than 70% of the 100 S&P 500 companies that have reported earnings have beaten consensus earnings per share expectations by approximately 3% in aggregate.
2013-07-22 00:00:00 What the *&%! Just Happened? by Ben Inker of GMO
In a new quarterly letter to GMOs institutional clients, head of asset allocation Ben Inker highlights the period from May 22 to June 24 characterized by "the universality of the declines" across asset classes.
2013-07-19 00:00:00 Is Inflation Really Gone Forever? by Jon Ruff of AllianceBernstein
Recent movements in asset prices suggest that markets have forsaken any possibility of an inflation outbreak in the next decade. We believe that view is far too sanguine.
2013-07-19 00:00:00 Fixed Income Fed Insight: It's All About Employment by Christopher Molumphy of Franklin Templeton Investments
We can try to guess what the Fed is thinking, but ultimately the Fed is driven by inflation and the labor markets. With inflation seemingly under control, its really the labor markets that dominate. So if you want to know what the Feds going to be doing, look at the labor markets how many jobs we create each month and, most importantly, the unemployment rate.
2013-07-19 00:00:00 Opportunity in Europe by Team of Neuberger Berman
A striking feature of this years global stock market rally is that international markets have significantly trailed U.S. stocks. Nevertheless, Neuberger Bermans Asset Allocation Committee (AAC) recently made the contrarian call of upgrading its view for international developed markets, particularly Europe. In this Strategic Spotlight, we provide an update on the European economy and lay out some reasons for optimism despite the dour growth outlook.
2013-07-18 00:00:00 What's Next for the U.S. Dollar? by Nic Pifer of Columbia Management
Global government bonds have performed poorly so far this year. Year to date through July 13, the Barclays Global Treasury Index, which covers 30 investment grade domestic government bond markets, is down 5.5% in unhedged U.S. dollar terms. The same index hedged back to U.S. dollars is down 0.6% year to date. This difference in returns highlights a key point.
2013-07-17 00:00:00 China's Curbs on Bank Lending: Implications for the World Economy? by Giordano Lombardo of Pioneer Investments
Banks are by far the top-weighted sector group in China, so theres little chance for the broad market to buck the trend. Indeed the problem is sector-specific at first glance. Policy makers want to curb excess bank lending in an effort to make the industry better managed and more selective.
2013-07-17 00:00:00 The Bernanke Guessing Game by David Wismer of Flexible Plan Investments
There can be little doubt that US equity markets have become more dependent than ever, at least in the short-term, on the every utterance of Fed Chairman Ben Bernanke and his fellow FOMC members.
2013-07-17 00:00:00 Bubbles Forever by Robert Shiller of Project Syndicate
In 2006, the largest global real-estate bubble in history imploded, and the collapse of a major worldwide stock-market bubble a year later triggered the global financial crisis. Although one might think that we have been living in a "post-bubble" world since then, talk of new bubbles keeps reappearing.
2013-07-16 00:00:00 Triangulating a Truer Course Through Emerging Markets by Tassos Stassopoulos of AllianceBernstein
Where can you find a car market which will double in size in the next five years? Brazil and Russia might be obvious places to look, but would you have expected Chile, Colombia, Ukraine and Vietnam? Picking the next big themes in emerging consumer markets is even harder than in the well-researched developed world. To get a better handle, we think, requires a triangular approach.
2013-07-16 00:00:00 Arc of a Diver: The Budget Deficit's Plunge by Liz Ann Sonders of Charles Schwab
The budget deficit has been cut by more than halffrom over 10% of GDP to less than 5% today. June saw a budget surplus! The health of the private sector (given its deleveraging since 2007) more than offsets the drag from public sector deleveraging.
2013-07-15 00:00:00 Mid-Year Outlook: Waiting to Move Beyond a Muddle-Through Economy by Bob Doll of Nuveen Asset Management
By focusing on current economic conditions while giving due importance to the uncertainty created by Fed actions we offer thoughts for consideration in evaluating risk-on investments.
2013-07-15 00:00:00 And That's the Week That Was by Ron Brounes of Brounes & Associates
After weeks of naysaying and fear-mongering about the Fed, investors finally embraced news from Bernanke and friends and equities moved back into record-setting territory. While most accept the fact that the Fed has entered the beginning-of-the-end of its bond-buying stimuli, the minutes from the latest policy meeting and a few comforting comments from Dr. B. himself helped calm the masses that the program would not end yesterday.
2013-07-13 00:00:00 The Bang! Moment Shock by John Mauldin of Millennium Wave Advisors
This week we resume our musings about Cyprus, to see what that tiny island can teach us about our own personal need to engage in ongoing critical analysis of our lives and investment portfolios. Cyprus is not Greece or France or Spain or Japan or the US or (pick a country). I get that. No two situations are the same, but there may be a rhyme or two here that is instructive.
2013-07-10 00:00:00 3 Risks that Could Derail the Market Rally by Russ Koesterich of iShares Blog
Stocks can withstand moderate rate increases, as we saw last Friday when they rallied despite a sell-off in bonds. But Russ K warns that they may not withstand these three other scenarios.
2013-06-27 00:00:00 Turmoil Shouldn't Derail Turkey by Carlos von Hardenberg of Franklin Templeton Investments
In 2012, Turkeys stock market rose more than 50%, posting one of the strongest performances of any global equity market last year. However, recent news of protests sweeping the nation has started scaring off some investors, at least in the short term. We consider turmoil to often be a natural part of change and development, and these short-term political disturbances likely wont be the last. Ive invited my colleague Carlos von Hardenberg, Managing Director, Turkey, based in Istanbul, to share some local insight.
2013-06-25 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn
All markets came under pressure last week (and this morning) over the dual concerns of a slowing global economy coupled with the Federal Reserves suggestion that things are improving and thus tapering might start by the end of the year.
2013-06-25 00:00:00 Rates, Dividends and The Laws of Gravity by Don Taylor of Franklin Templeton Investments
The laws of gravity may dictate that what goes up must come down, but interest rates seem to have their own converse course of action what goes down eventually will go up. Although it seems like interest rates can stay stuck in low gear for years, (decades even, in the case of Japan) eventually they will creep higher, and talk is heating up about the timing and magnitude of such creep in the US. As the portfolio manager of Franklin Rising Dividends Fund, Don Taylor was quick to comment that higher interest rates dont mean all dividend-paying stocks are doomed.
2013-06-24 00:00:00 The Case for Rotating into (Select) Cyclical Sectors by Russ Koesterich of iShares Blog
Although defensive sectors are back to outperforming cyclical sectors amid Junes market volatility, Russ still believes theres a strong case for preferring cyclicals or at least select cyclicals
2013-06-21 00:00:00 Outlook for the Global Bond Market by Nic Pifer of Columbia Management
The global economy continues to expand, but seems stuck on a moderate, below-trend trajectory. Lately, the story seems to be more about a growth rotation across regions than a clear-cut acceleration or deceleration at the global level. Looking to 2014, however, we still expect the global economy to accelerate to a more trend-like pace.
2013-06-21 00:00:00 Un-Addiction by Jeremy Boynton of Laureate Wealth Management
It appears that the Un-Addiction process has begun. This marks a significant shift for the world of investments. Volatility is on the rise. Interest rates are rising / normalizing. In such a fragile economy, it seems prudent to consider that the risks of economic recession are somewhat higher, even if they are still not the base case. As always, please feel free to contact me with any thoughts or questions.
2013-06-15 00:00:00 Economists Are (Still) Clueless by John Mauldin of Millennium Wave Advisors
The economic forecasts of mainstream economists are quite positive, if not enirely optimistic, reflecting the current data. Should we not take heart from that? Alas, no. This week we look at some of our recent musings on that topic, triggered by a letter from a very serious economist who took umbrage when I wrote disparagingly about economists and forecasting a couple months ago.
2013-06-14 00:00:00 A Move Away from Defense by Ted Baszler of Heartland Advisors
It may seem a little counterintuitive, but as stocks have rallied to new highs since 2009, defensive sectors have led the way. This outperformance has been reflected in the relatively high forward price/earnings multiples among staid sectors like Utilities, Health Care, Telecom, and Consumer Staples.
2013-06-12 00:00:00 Silver Lining: Fed's Tapering Signals Stronger Economy by Eric Takaha of Franklin Templeton Investments
The Federal Reserves warning that it planned to scale back purchases of Treasuries sparked a storm on Wall Street, bringing instability to what had been a pleasant May in the US markets. Almost lost in the noise, however, is a silver lining: the Fed thinks the economy may be healthy enough to fly on its own.
2013-06-11 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn
The last few weeks have seen volatility emerge as concerns about the Feds policy of quantitative easing and the timing of changing it have taken center stage.
2013-06-08 00:00:00 Banzai! Banzai! Banzai! by John Mauldin of Millennium Wave Advisors
In practice it may be harder for Japan to grow and generate inflation than it might be for other major nations. Today we’ll focus on Japanese demographics. While the letter is full of graphs and charts, it does not paint a pretty picture. The forces of deflation will not go gently into that good night.
2013-06-04 00:00:00 Stocks: How Long Will the Bull Run? by Milton Ezrati of Lord Abbett
Conditions appear favorable for the next 12 to 24 months. What could change the markets prospects in the longer term? Heres a look.
2013-06-01 00:00:00 After the Gold Rush by Nouriel Roubini of Project Syndicate
The run-up in gold prices in recent years from $800 per ounce in early 2009 to above $1,900 in the fall of 2011 had all the features of a bubble. And now, like all asset-price surges that are divorced from the fundamentals of supply and demand, the gold bubble is deflating.
2013-06-01 00:00:00 Central Bankers Gone Wild by John Mauldin of Millennium Wave Advisors
For the last two weeks we have focused on the problems facing Japan, and such is the importance of Japan to the world economy that this week we will once again turn to the Land of the Rising Sun. I will try to summarize the situation facing the Japanese. This is critical to understand, because they are determined to share their problems with the world, and we will have no choice but to deal with them. Japan is going to affect your economy and your investments, no matter where you live; Japan is that important.
2013-05-29 00:00:00 Outlook on the Japanese Equity Market by Team of Nomura Asset Management
The Nikkei Stock Average closed 128 points higher, or 0.9%, to close the week at 14,612 following the dramatic 7.3% sell-off on Thursday, May 23, 2013. The Tokyo Stock Price Index (TOPIX) also added 6 points, or 0.5%, to 1,194, following a 6.9% sell-off on Thursday, May 23rd.
2013-05-28 00:00:00 Taking Stock by Bob Doll of Nuveen Asset Management
U.S. and global equities were under pressure last week, with all major U.S. indices lower for only the fourth time this year. With discussion of the Fed tapering its stimulus, market uncertainty gained momentum. The S&P 500 was down 1.0% for the week.1 We consider the market pullback technical in nature since the mention of a Fed quantitative easing exit likely created a natural point to take profits after the recent rally.
2013-05-25 00:00:00 The Mother of All Painted-In Corners by John Mauldin of Millennium Wave Advisors
Japan has painted itself into the mother all corners. There will be no clean or easy exit. There is going to be massive economic pain as they the Japanese try and find a way out of their problems, and sadly, the pain will not be confined to Japan. This will be the true test of the theories of neo-Keynesianism writ large. Japan is going to print and monetize and spend more than almost any observer can currently imagine. You like what Paul Krugman prescribes? You think he makes sense? You (we all!) are going to be participants in a real-world experiment on how that works out.
2013-05-22 00:00:00 When Will the U.S. Economy Stop Slowing Down and Start Speeding Up? by Marco Pirondini of Pioneer Investments
As earnings data from companies comes trickling in, it all but confirms a slowdown in the second quarter.
2013-05-22 00:00:00 Is Japan's Economic Rebound For Real? by Daisuke Nomoto of Columbia Management
The two phrases Abenomics and the BOJs Shock and Awe Monetary Easing are all over the headlines about Japan. Prime Minister Abe unveiled his economic policy late last year calling for a 3% annual nominal gross domestic product (GDP) growth target and an aggressive monetary easing by the BOJ (The Bank of Japan) to achieve 2% inflation. The BOJ unleashed the worlds most intense burst of monetary stimulus last month promising to double the monetary base to 270 trillion yen ($2.7 trillion) by the end of 2014 to defeat deflation.
2013-05-21 00:00:00 DC Plan Sponsors Should Look Further than Their Own Backyard by Alison Martier, Seth Masters of AllianceBernstein
US defined contribution (DC) plan sponsors large and small are seeking ways to help plan participants achieve better outcomes. Over the last 30 years, compelling evidence has accumulated that suggests currency-hedged global bonds may be an important part of the solution.
2013-05-21 00:00:00 Putting Cash to Work: 3 Ways to Enter the Market Today by Russ Koesterich of iShares Blog
With global equities up more than 25% since their bottom last June, many investors are wondering: Is it too late to move cash from the sidelines to stocks? No, says Russ, and he offers three ideas for where find value today.
2013-05-20 00:00:00 Bernanke's JEC Testimony by Scott Brown of Raymond James
On Wednesday, May 22, Federal Reserve Chairman Ben Bernanke will testify on The Economic Outlook. The next monetary policy meeting is four weeks away, but Bernanke is likely to provide a preview of what will be discussed at that time specifically, on the issue of when to begin reducing the rate of asset purchases. The short answer may be it depends.
2013-05-17 00:00:00 4 Reasons to Still Hold High Yield by Russ Koesterich of iShares Blog
With high yield spreads historically tight and prices at all-time highs, some market watchers are wondering whether its time to jump off the high-yield bandwagon. Russ weighs in and explains why this asset class is still worth holding.
2013-05-15 00:00:00 And That's the Week That Was by Ron Brounes of Brounes & Associates
Fiscal Cliff. Sequester. Different names for similar budgetary issues that both basically resulted in games of Congressional kick the can. Now in a stroke of luck for non-compromising politicos, the budget deficit is shrinking as higher payroll taxes and paybacks from previously bailed out entities (thanks Fan) have enhanced government revenues since the beginning of the year.
2013-05-15 00:00:00 How to Take Advantage of the Great (Sector) Rotation by Russ Koesterich of iShares Blog
The real Great Rotation may just be a shift to cyclical sectors from defensive ones rather than a move to bonds from stocks. Russ explains and offers 3 ways to play this rotation.
2013-05-14 00:00:00 Inflation Update by Team of North Peak Asset Management
Basing investment decisions on inaccurate measurements of the inflation rate can result in investors unknowingly positioning their portfolios to lose purchasing power over time. This mis-measurement could be especially dangerous when yields are low. For example, evaluating a nominal 3% investment opportunity using an inaccurate 2% inflation rate indicates a marginally attractive 1% real return opportunity. However, if inflation is actually running at 5%, this becomes a deeply unattractive negative 2% real return investment.
2013-05-09 00:00:00 Equity Market Distortions Create Big Payback Potential by Joseph Paul, Kevin Simms of AllianceBernstein
Even after this years equities rally, market imbalances created by the financial crisis in 2008 have not disappeared. When these distortions unwind, we expect deep value stocks to rapidly recover.
2013-04-30 00:00:00 The U.S. Economy A Gain in GDP? by Marie Schofield of Columbia Management
The advance estimate of gross domestic product (GDP) released by the Bureau of Economic Analysis last Friday showed that the U.S. economy grew at an annualized rate of 2.5% in the first quarter, below expectations of an increase of 3.0%. Despite the decent first quarter advance, year-over-year gains in nominal and real GDP are largely unchanged from the prior quarter at 3.4% and 1.8%, respectively. While growth rates at this slow pace in these measures have typically heralded recessions, they appear stable but also underscore a critical problemthe failure to generate escape velocity.
2013-04-30 00:00:00 Beyond Gold: 4 Reasons to Think Energy by Russ Koesterich of iShares Blog
While the sell-off in gold has dominated headlines lately, another commodity oil has also experienced price declines in recent months. But despite crudes drop, Russ is still a fan of energy stocks for four reasons.
2013-04-26 00:00:00 The Sustainability of U.S. Interest Rates Rising by Paresh Upadhyaya of Pioneer Investments
Investors are growing concerned, with good reason, we think, that yields have bottomed for the 10-year Treasury and will surge as the economy gains strength. Prices, which move inversely to yields, would fall, and the question is whether rising rates in 2013 could trigger a bond bear market along the lines of the Great Bond Bear Market of 1994. We dont think so.
2013-04-26 00:00:00 Why Demographics Will Keep the U.S. Ahead by Randall McLaughlin of Baird Investment Management
The aging of the developed world does give us some powerful information about which industries might do well in the future. The increased use of healthcare services as a population ages is well-documented. In addition, as people age, they transition from accumulating possessions to using their wealth to buy experiences. Travel companies are examples of companies that could benefit. The favorable demographic profile of the United States supports our manufacturing renaissance thesis as companies tend to want to locate manufacturing close to the end client.
2013-04-25 00:00:00 Murkier Prospects for Merkel by Milton Ezrati of Lord Abbett
An anxious German electorate may make it harder for the chancellor to continue her pro-cooperation approach to Europes fiscal crisis.
2013-04-22 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management
The deadly bombings in Boston last week, along with a spate of senseless killings in Newtown and Aurora, should highlight for those consumed by economics and financial market statistics the fragility of life and a sense of perspective about helping those in need at their darkest hour. How noble that on the day of the U.S. equity markets most damaging point collapse in years, our focus was on Boston and not on our wallets or portfolios.
2013-04-22 00:00:00 Commodity Declines and Weak Data Startle Investors by Bob Doll of Nuveen Asset Management
U.S. equities declined last week as the S&P 500 fell by more than 2.0%, which came on the heels of a new all-time high the prior week. Led by gold, commodities experienced volatility and declined over the past two weeks. Other detractors included disappointing first quarter Chinese economic numbers and somewhat softer U.S. releases.
2013-04-20 00:00:00 Austerity is a Consequence, not a Punishment by John Mauldin of Millennium Wave Advisors
Austerity is a consequence, not a punishment. A country loses access to cheap borrowed money as a consequence of running up too much debt and losing the confidence of lenders that the debt can be repaid. Lenders don’t sit around in clubs and discuss how to “punish” a country by requiring austerity; they simply decide not to lend. Austerity is a result of a country’s trying to entice lenders into believing that the country will change and make an effort to restore confidence.
2013-04-19 00:00:00 Global Economic Overview - March 2013 by Team of Thomas White International
Global economic trends turned softer during the month of March as indicators from Europe showed further declines and U.S. consumer sentiment moderated on labor market uncertainties, government spending cuts, and tax increases. Continuing weakness in European demand has somewhat dulled the export outlook for emerging economies, while government policies to prevent excessive asset price inflation have led to concerns about domestic consumption growth in these countries.
2013-04-18 00:00:00 After Boston: Why the US Market is Vulnerable by Russ Koesterich of iShares Blog
The events in Boston were a tragic reminder that markets still face risks from terrorism and geopolitics. In fact, the US market is especially vulnerable to such exogenous shocks right now given that there isnt much bad news discounted into prices.
2013-04-18 00:00:00 Inflation and Interest Rates by Scott Brown of Raymond James
The Federal Reserve began its first asset purchase program in the fall of 2008, during the depth of the financial panic. Some observers feared that the Feds actions would fuel higher inflation. However, the Fed is now well along in its third asset purchase program and inflation (as measured by the PCE Price Index) has remained low. In fact, Fed officials expect that inflation will trend at or below the 2% target for the next couple of years. That hasnt stopped the inflation worrywarts from predicting that inflation is still just around the corner.
2013-04-11 00:00:00 Patton, the Pope, and Skylar by Michael Kayes of Willingdon Wealth Management
In the powerful opening scene to the movie, "Patton," the famous general stands before his troops and boldly states, "Americans love a winner, and will not tolerate a loser." Its hard not to stand a little straighter when you hear a line like that. We do like to think about ourselves as the greatest country in the world. Certainly in economic terms the United States has accomplished more than any other civilization known to man.
2013-04-10 00:00:00 Economic Slowdown Halts Equity Rally by Bob Doll of Nuveen Asset Management
The latest softness in economic indicators probably means that more consolidation in the equity markets is required before we can advance beyond the recent all-time highs. During March, nearly all of the activity for the S&P 500 was within 1% of 1550. Equities may move lower due to deteriorating technical conditions and the possibility of weak first quarter earnings reports.
2013-04-10 00:00:00 Surprising Surge!! by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup
Momentum from 2012s surprisingly strong performance continued into the first quarter of 2013 with stocks rising sharply. Our portfolios did well but lagged behind our benchmarks in the quarter. Taking a little longer view, over the trailing 12 and 36 months we mostly matched the double-digit gains of our benchmarks, which we are very pleased with since we usually underperform during strong market advances. So far this year small- & mid-capitalization, value, and domestic stocks were the market leaders, while international, growth, commodity stocks and Apple were laggards.
2013-04-10 00:00:00 The Global Growth Quest by Mohamed El-Erian of Project Syndicate
The last few years have highlighted the declining potency of long-standing growth models. Moreover, the search for more robust growth models will take much longer and be more complicated than many recognize especially as the world economy pivots away from unfettered globalization and high levels of leverage.
2013-04-05 00:00:00 What's Next for U.S. and European Markets? by Mike Temple of Pioneer Investments
I was asked recently to provide some color around the state of global fixed income markets as we close out the first quarter of 2013. Of course, one of the more watched situations in the global markets has been Cypruss banking crisis. I wont go into too much depth on the subject here, as my colleague, Cosimo Marasciulo, has recently provided a comprehensive analysis.
2013-04-01 00:00:00 The Global Economy on the Fly by Nouriel Roubini of Project Syndicate
In a fragile global environment, has America become a beacon of hope? While the US is experiencing several positive economic trends, Europe continues to stagnate, and China will be vulnerable to a hard landing in 2014 unless its new leaders accelerate the pace of reform.
2013-04-01 00:00:00 The Discipline of Buy and Sell Decisions by Mark Mobius of Franklin Templeton Investments
The thought of giving up a once-treasured possession can be an emotional exercise for anyone, even if the object of affection has outlived its use. As investors, we can find it difficult to sell a once-favored holding even more difficult than the decision to purchase it. But sometimes, you just have to let go.
2013-03-28 00:00:00 2 Factors Keeping a Lid on Interest Rates by Russ Koesterich of iShares Blog
Investors have been expecting interest rates to rise, but with the yield on the 10-year Treasury bond back below 2%, Russ explains two structural factors that are slowing the rate rise.
2013-03-27 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management
Even after a global market surge that virtually wiped away the four year bear market, equities still seem to be the best game in town. Corporate and individual investors are flocking back to a haven they had abandoned in favor of bonds when, in an era long ago, yields and credit rating offered them a secure place to park money.
2013-03-22 00:00:00 ING Fixed Income Perspectives March 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management
Developed sovereigns are still broadly unattractive, but global central banks appear poised to ease. We prefer EM currencies that will continue to benefit from positive global growth and tolerate further upward pressure on the U.S.
2013-03-22 00:00:00 US Stocks: Third Times the Charm by Seth Masters of AllianceBernstein
At 1550, the S&P 500 has regained the peak it reached in March of 2000 (when the tech bubble burst) and again in October of 2007 (before the credit crunch hit). But we think the third times the charm: We think the stock market still has room to rise because equities are now more attractively valued and of higher quality than they were at previous peaks.
2013-03-21 00:00:00 Global Markets Time Factor by Mohamed El-Erian of Project Syndicate
In recent months, the dichotomy between booming financial markets and sluggish economies (and dysfunctional politics) has loomed large. The critical element of time and who controls it could well mean the difference between an orderly global resolution of todays ongoing financial problems and a return to serious trouble.
2013-03-19 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn
Stocks had a very quiet week with volumes reaching levels that one associates with holiday trading.
2013-03-18 00:00:00 And That’s the Week That Was by Ron Brounes of Brounes & Associates
Move over Dow Jones, here comes the S&P. What few thought possible a year ago is coming to fruition as the major indexes continue to push toward record territory. The S&P 500 is close (but no cigar) to besting its personal high set in late 2007, before this whole banking mess emerged and sent equities into a tailspin. Confident investors seemed to be overlooking the numerous concerns (budget/sequester, payroll taxes, Europe, China) so they can participate in the record run.
2013-03-13 00:00:00 Feared Copper "Flood" More Likely a Trickle by Jon Ruff of AllianceBernstein
Investors have turned bearish on commodities, particularly in the case of copper, where recent talk of a looming surge in new supply has sparked fears of a price rout. Were skeptical about the copper supply-glut story and dont think whats happening in copper is a "canary in the coal mine" for the rest of the metals markets.
2013-03-13 00:00:00 Dow--Then and Now by Frank Holmes of U.S. Global Investors
The Dow Jones Industrial Average is making record highs, knocking the 2007 peak off its pedestal, but investors arent celebrating.
2013-03-12 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn
Stocks rose each day last week as the notion of a ho-hum global economy was reassuring to those who fear either a recession or a surge in economic activity.
2013-03-07 00:00:00 US Manufacturing Restores Competitive Vigor by Joseph Carson of AllianceBernstein
The US manufacturing sector has repeatedly figured out how to reinvent itself when faced with competitive threats. In recent years, American companies have become much leaner, regaining an edge in global markets that should lead to a bigger role in economic growth.
2013-03-05 00:00:00 No Rest for the Wicked by Scott Brown of Raymond James
With headwinds fading, the U.S. economic recovery appeared poised to pick up more substantially in 2013. Unfortunately, fiscal policy is going in the wrong direction.
2013-03-01 00:00:00 Seeking a Fixed Income Fix by Team of Franklin Templeton Investments
While governments worldwide continue to struggle with debt and budget issues, for the most part, corporations have turned lemons into lemonade and have become lean and mean. While not without risk, corporate credit actually looks to be in fairly good shape, according to Eric Takaha who, as senior vice president and portfolio manager of Franklin Strategic Income Fund spends a good deal of time analyzing the space.
2013-02-27 00:00:00 "Abenomics" & the Weakening YenToo Far, Too Fast by Chun Wang of Leuthold Weeden Capital Management
Japan's new Prime Minster Shinzo Abe made more of an impact on the market than anyone else last month. In what the market has dubbed "Abenomics," Abe not only launched a new fiscal stimulus, but also pushed the Bank of Japan to raise its inflation target from 1% to 2% AND agree to a new open-ended QE program. The reluctance on the BoJ's part is clearly visible because the new open-ended QE will not start until 2014 and there is no commitment to asset purchases after 2014. Shortly afterwards, the BoJ governor said he would step down, a clear sign of disagreement.
2013-02-25 00:00:00 We Expect High-Yield Defaults to Remain Low by Jeff Skoglund of AllianceBernstein
High-yield bond defaults are historically low today, even for troubled companies. Despite the worries we hear in some corners about looming high-yield defaults, we think default rates will stay low for at least the next few years. In the wake of the 2008 financial meltdown, US companies did the responsible thing and got leaner, reducing head count and overhead costs aggressively. When the recovery gained traction, they held the line on expensesand profit margins are at historic highs today.
2013-02-21 00:00:00 Fed Must Tune in to Changing US Economy by Joseph Carson of AllianceBernstein
With each passing month, more questions are being asked about the sluggish US economic recovery. Why has growth been subdued since the recession ended in mid-2009? What's changed in the economy? How long can loose monetary policies persist before promoting more inflation or creating a new bubble?
2013-02-20 00:00:00 Two New Country Views for a Two-Speed Global Economy by Russ Koesterich of iShares Blog
The global economy is stuck in a two-speed regime: Developed markets like Europe, Japan and the United States are stalling, while China is re-accelerating. Russ explains what this divergent growth landscape means for his country outlooks.
2013-02-19 00:00:00 All is Not Well Down Under by Russ Koesterich of iShares Blog
Though Russ continues to like Australian equities for the longer term, he explains why he may downgrade his near-term view of the Australian market soon.
2013-02-19 00:00:00 On Competitive Devaluations by Scott Brown of Raymond James
Aggressive monetary policy moves in recent years have been accompanied by a growing fear of a currency war. In a currency war, or competitive devaluation, countries attempt to weaken their currencies to boost exports, but each devaluation leads to counter devaluations. That's not what's going on now. However, whether a country is purposely devaluing its currency or is merely pursuing accommodative monetary policy is irrelevant, the consequences are the same. The recent meeting of G-20 finance ministers and central bankers highlights the lack of coherent policies to boost growth.
2013-02-13 00:00:00 January Retail Sales: Why Stocks May Be Vulnerable by Russ Koesterich of iShares Blog
When the Commerce Department releases the headline January retail sales number on Wednesday, economists expect to see a big drop from December. Russ explains why the number could come in even lower and the implications for investors.
2013-02-11 00:00:00 After ATRA, Tax Management Gains Importance by Daniel Eagan, Paul Robertson of AllianceBernstein
The US tax reform just enacted has made effective tax management of portfolios far more valuable for some investors. The old rules of thumb never really worked, but their shortcomings will now cost investors more.
2013-02-11 00:00:00 When to Worry About Inflation by Russ Koesterich of iShares Blog
Though the Fed continues to flood the US economy with money, Russ explains why inflation isn't likely to be a problem until 2014 and what investors can do in the meantime to prepare.
2013-02-11 00:00:00 Stocks: Why "Risk On" Rules by Milton Ezrati of Lord Abbett
Investors appear to believe the equity market will muddle through its many challenges.
2013-02-11 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management
For many months I have been commenting that the critical element most lacking from our rebound in economic development has been "consumer confidence." Wouldn't it be nice if we could not only quantify confidence but also to define it, accurately? After all, something so nebulous as one's opinion about something, also has the power to shape behavior and consequences for a myriad of financial and economic events. Besides, one man's opinion might not be shared by a multiplicity of others
2013-02-08 00:00:00 Golden State Gets Upgrade by Frank Holmes of U.S. Global Investors
The turbulent clouds that settled upon California's bond market are beginning to dissipate, as the state's general obligation debt was recently upgraded to 'A' by Standards & Poor's. It has been almost a year since the rating agency has had a sunny outlook on the Sunshine State, but a series of improving economic data and better fiscal position have been turning things around.
2013-02-08 00:00:00 Messing with the Bull by Peter Schiff of Euro Pacific Capital
With the announcement this week of its massive $5 billion lawsuit against ratings agency Standard & Poor's, the Federal Government took a bold step to squelch any remaining independence of thought or action in the financial services industry. Given the circumstances and timing of the suit, can there be any doubt that S&P is paying the price for the August 2011 removal of its AAA rating on U.S. Treasury debt?
2013-02-08 00:00:00 World War C: Neosho Capital On The Currency War by Chris Richey of Neosho Capital
This summer, Brad Pitt will star in a new film called "World War Z", an action-horror film about a post-zombie apocalypse Earth, hence the "Z" in the title. Zombie films are not our cup of tea at Neosho (we thought the genre was dead), so it is debatable whether we will see this film, but one thing is clear to us, we are perched on the precipice of "World War C", where "C" stands for "currency".
2013-02-07 00:00:00 Complacency in a Leaderless World by Joseph Stiglitz of Project Syndicate
In the last 25 years, we have moved from a world dominated by two superpowers to one dominated by one, and now to a leaderless, multi-polar world. While we may talk about the G-7, or G-8, or G-20, the more apt description is G-0. We will have to learn how to live, and thrive, in this new world.
2013-02-05 00:00:00 The 2030 Outlook by Bill O'Grady, Kaisa Stucke of Confluence Investment Management
Over the next several weeks we will look into the more distant future, to the year 2030. We will explore the long-term strategic alternative world development scenarios as laid out by the National Intelligence Council (NIC) and present our views regarding the developments. The NIC forecasts the likely paths that are either currently underway or are forecast to occur in the future. The NIC projects four possible global political and economic states based on these expected trends.
2013-02-05 00:00:00 2012 Equity Market Market Year in Review by Natalie Trunow of Calvert Investment Management
Equities started the year strong as global inflation remained tame, and aggressive, accommodative monetary policy by central banks around the globe helped equity markets rally hard off their lows posted in the fall of 2011. Continuously improving U.S. economic data, strong corporate earnings, and policy steps toward mitigation of the sovereign debt crisis in Europe also provided support for the equity markets worldwide.
2013-01-30 00:00:00 EU Financial Tax Portends Loss of Market Leadership by John Browne of Euro Pacific Capital
Although it was barely noticed by the American press, on January 22nd, EU finance ministers approved a new "Financial Transactions Tax" (FTT) that has implications for market competitiveness around the world.
2013-01-29 00:00:00 Investment Basics by Michael Kayes of Willingdon Wealth Management
I've always been curious about how famous people would have done had they pursued completely different careers. Some of our former presidents make excellent examples. For instance, Abe Lincoln towered over his contemporaries. I wonder how he would have fared as a basketball player had the game existed during his life. Our heaviest president, William Howard Taft weighed well over 300 pounds. Had football risen to prominence a few decades earlier, could gridiron greatness have been part of his resume?
2013-01-24 00:00:00 Beggar Thy Currency Or Thy Self? by Mohamed El-Erian of Project Syndicate
One need not be an economist to figure out that, while all currencies can depreciate against something else (like gold, land, and other real assets), by definition they cannot all depreciate against each other. Yet, when push comes to shove, country after country is being dragged into a negative dynamic of competitive depreciation.
2013-01-23 00:00:00 Inflated Expectations? by Kristina Hooper of Allianz Global Investors
Investors should prepare themselves for higher long-term inflation because the market may be ignoring it, a mistake that could come back to haunt. On the heels of encouraging economic data, central bankers are projecting only modest price increases for goods and services over the next 10 years. But history tells us that an inflation spike is inevitable when governments print money so aggressively. As such, investors with long-term time horizons should have substantial exposure to inflation-hedging asset classes. Now, more than ever, real returns matter.
2013-01-22 00:00:00 The Economic Fundamentals of 2013 by Nouriel Roubini of Project Syndicate
The global economy this year will exhibit some similarities with conditions prevailing in 2012 no surprise there. But there will be some important differences, as fiscal austerity spreads to more advanced economies, the risk of a hard landing in China rises, and the threat of war in the Middle East grows.
2013-01-22 00:00:00 Equities Set to Break Out of the Bear Trap by Catherine Wood of AllianceBernstein
In the face of significant uncertainties, US and global equities rallied in 2012 and at the start of the New Year. We think there might be more to come as stocks break out of the bear trap.
2013-01-22 00:00:00 Consumer Staples: Don't Overpay for Safety by Russ Koesterich of iShares Blog
Many investors have flocked to the perceived safety of defensive sectors over the past few years, including consumer staples. But Russ gives three reasons they might want to think twice about the sector now.
2013-01-16 00:00:00 Obama Claims We Don't Have A Spending Problem by Gary Halbert of Halbert Wealth Management
There's a lot to talk about this week. A lot of my contemporaries are offering their predictions for the New Year. But with our nation now over $16 trillion in debt and annual budget deficits over $1 trillion, I don't think there is any way to accurately predict what will happen this year. Another financial crisis could rear its ugly head just about any time.
2013-01-16 00:00:00 The Trillion Dollar Trick by Peter Schiff of Euro Pacific Capital
The birth, and the apparent death, of the trillion dollar platinum coin idea may one day be recalled as a mere footnote in the current debt crisis drama. The ultimate rejection of the idea (which was to use a loophole in commemorative coinage law to mint a platinum coin of any denomination) by both the President and the Federal Reserve seems to offer some relief that our economic policy is not being run by out-of-touch academics and irresponsible congressmen. In reality, our government has been creating more than one trillion dollars out of thin air every year for the past five.
2013-01-14 00:00:00 Bond Market Review & Outlook by Thomas Fahey of Loomis Sayles
The ?nal quarter of 2012 was the icing on the cake of an exceptional year for the credit sectors. Fourth quarter credit gains stemmed in part from uncommonly aggressive monetary policy responses in the third quarter. As economic growth continued to undershoot expectations, major central banks made clear that they were dissatis?ed with the status quo of tepid economic growth and high unemployment. The Federal Reserve went so far as to tie its monetary policy to the level of the unemployment rate.
2013-01-11 00:00:00 2 Reasons to Stick With Emerging Markets by Russ Koesterich of iShares Blog
Think emerging markets equities have run their course? Not so fast despite recent strong performance, Russ explains why there's room for further EM gains in 2013.
2013-01-08 00:00:00 3 Key Dates to Watch After the Fiscal Cliff Deal by Russ Koesterich of iShares Blog
After last week's partial deal, Russ explains when investors should expect more market volatility and another round of late-night drama from Washington.
2013-01-07 00:00:00 Germany and Eastern Europe: Lessons in Free Trade by Team of Thomas White International
Economies in east and central Europe are attracting huge foreign investments into the automobile sector.
2013-01-03 00:00:00 The Political Economy of 2013 by Mohamed El-Erian of Project Syndicate
Watching America's national leaders scramble in the closing days of 2012 to avoid a "fiscal cliff" that would plunge the economy into recession was yet another illustration of an inconvenient truth: messy politics remains a major driver of global economic developments. This will become even more evident worldwide in 2013.
2011-10-13 00:00:00 Why Is Financial Market Volatility Increasing? by Alan A. Fustey of Index Wealth Management
While price movements in financial markets are largely unpredictable, there are periods where volatility tends to cluster. The flash crash shows that high frequency trading does have the potential to heighten volatility given the right circumstances, however knowing when these circumstances are present can only be detected in hindsight. There are structural changes that are occurring in the global economy, technology and securities trading that have the potential to make the recent increase in market volatility a new permanent standard.
2010-04-07 00:00:00 Currency Manipulation: A Primer by Komal Sri-Kumar of TCW Asset Management
The air is thick with allegations that China is manipulating its currency by keeping the renmibi fixed and undervalued with respect to the U.S. dollar. All of this is in anticipation of whether Treasury Secretary Timothy Geithner will designate China as a currency manipulator in his semi-annual report to Congress on trade practices. This designation could lead to new U.S. sanctions against Chinese exports. Ultimately, however, the key to success for U.S. authorities would not be public criticism of the United States' largest creditor, but a thoughtful discussion behind closed doors.
2010-03-15 00:00:00 Weekly Commentary and Outlook by Tom McIntyre of McIntyre, Freedman & Flynn
The conventional wisdom seems to be that the worst is over and a slow but self-sustaining recovery is taking place. A very quiet and slow week of trading produced yet another advance in the stock market. Concerns over Greece and other sovereign debt issues receded, while evidence on the global economy was mixed. The Dow Jones Industrial Average gained 1.5 percent while the NASDAQ gained 1.8 percent over excitement generated by the new product line by Apple.
2010-03-08 00:00:00 Weekly Commentary and Outlook by Tom McIntyre of McIntyre, Freedman & Flynn
Stocks rallied last week as evidence continued to show that even though unemployment is lagging, the rest of the economy is doing better. While the unemployment rate stayed constant at 9.7 percent, falling labor costs allowed companies to increase profit margins, and thus buoy stocks through solid fundamentals. If interest rates stay low, conditions will be perfect for stocks, because stock markets respond to prospects for profits and interest rates. McIntyre also examines the possible impact of health care reform, and the recent performance of Dow Chemical and Boeing.
2010-02-18 00:00:00 Paper Hangers by John Browne of Euro Pacific Capital
The 80-year decline in central banking discipline is the biggest problem facing developed economies. Finance ministers from Washington to London, Tokyo, Madrid and Athens are attempting to fill fiscal gaps by issuing greater quantities of currency and debt. Governments need to curtail spending in order to meet financial obligations.
2010-02-16 00:00:00 G7 Weekly Economic Prospects by Christopher Probyn and Geoffrey Somes of State Street Global Advisors
Christopher Probyn and Geoffrey Somes of State Street Global Advisors say in their weekly economic commentary that US retail sales rose 0.5 percent in January, but consumer confidence fell 0.7 points, to 73.7. Investor risk appetites improved following assurances that the EU will stand behind Greek fiscal reforms.
2010-02-04 00:00:00 Country Stock Market Performance by Team of Bespoke Investment Group
Worries about a few EU countries and the Euro currency have rattled global equity markets. Sovereign debt credit default swaps have been rising sharply for countries such as Greece and Portugal in recent days. Equity markets in Spain, Portugal, and Hungary are down more than 5% today alone. They highlight the year to date performance and performance since the 1/19 peak for the major equity markets of 81 countries around the world.
2010-01-22 00:00:00 Reflections Across the Pond by John Browne of Euro Pacific Capital
Having been among the economic engines of Europe for much of the past decade, it appears as if the British economy has run out of steam. Inflation is rising while bankruptcies and unemployment continu
2010-01-16 00:00:00 Q1 2010 Newsletter by Bradley Turner of Chess Financial
It is our expectation that the returns of the major assets classes will generally be lower and less correlated in the year ahead. We reach this conclusion based on several factors, the first of which
2009-12-30 00:00:00 Monetary Policy: Inflation-Deflation, Debt, Excess Reserves, Currency Volatility by Michael J. Schussele of Michael J. Schussele, CPA