The Capital Growth Channel

Are FANG Investors Playing the Role of Greater Fools?

Introduction The greater fool theory is an investing metaphor that suggests that if you pay more for a stock than it is worth (intrinsic value indicates) that you are only doing this on the basis that a fool greater than you will come along and willingly pay you more.

2Q Corporate Results: All-Time High Sales, Profits and Margins

Corporate results in the second quarter were excellent. S&P sales grew 11%, earnings rose 27% and profit margins expanded to a new all-time high of 11.4%. Fundamentals are driving the stock market higher, not valuations: earnings during the past 1 year and 2 years have risen faster than the S&P index itself. The strong growth in company profits is not due to the net reduction in shares through, for example, corporate buybacks.

Asia on Sale

As Russ notes, in a world with few bargains, one stands out: Asia.

Of Currencies, Trade and Other Clouds

Emerging markets have struggled in the first half of this year amid a storm of uncertainties. Franklin Templeton Emerging Markets Equity’s Chetan Sehgal examines issues that have acted as clouds on the asset class—including a stronger US dollar and trade skirmishes...

De-FANGed Trade?

A review of last month’s market-moving events across countries and asset classes.

Demystifying Big Data: How to Critically Assess Quantitative Investment Signals

As leaders in manager research, we have unique insight into the implementation of big data in equity portfolios. Today, we share our key observations.

July Retail Sales: Up 0.5% MoM, Better Than Forecast

The Census Bureau's Advance Retail Sales Report for July was released this morning. Headline sales came in at 0.5% month-over-month to one decimal and was better the forecast of 0.2%. Core sales (ex Autos) came in at 0.59% MoM (to two decimals). Revisions were made to May and June figures.

Five Ways to Drive Leads While Driving Your Car

The car you drive isn’t just a status symbol. In the age of digital communication, Bluetooth and wired vehicles, advisors can use their cars to drive leads by converting boring downtime during a commute into active prospecting.

Household Debt And Credit Report: Up by $82B in Q2

Household debt increased by $82B (0.6%) to $13.29 trillion in Q2. There were increases in mortgage, auto, and credit card debt and a modest decline in balances on home equity lines of credit and student loan debt.

Using Dr. Copper to Check the Pulse of the Global Economy

Holy cow! This economy is on fire; witness the second quarter U.S. GDP growth rate of 4.1%. Is it sustainable or a just a temporary spurt? It’s often said that the Copper price has a PHD in economics, because of its widespread use in many diverse industries. That use ranges from homes, factories, and electronics, to power generation and transmission and much more.

Under Siege: How Trade Wars Affect the World’s Major Automakers

From steel to engines to whole cars, tariffs are shifting the playing field for automakers. Our credit analysis suggests there are no winners in this war: consumers should expect higher sticker prices, companies lower earnings and investors more volatility.

July 2018 Market Commentary

Stocks hit the ground running to start the second half of 2018.

NFIB Small Business Survey: "Small Business Optimism Index Nears Survey High in July"

The latest issue of the NFIB Small Business Economic Trends came out this morning. The headline number for July came in at 107.9, up 0.7 from the previous month and its second highest of all time. The index is at the 100th percentile in this series. Today's number came in above the forecast of 106.9.

World Markets Update

Three of eight indexes on our world watch list have posted gains through Monday, August 13, 2018. The top performer this year is India's BSE SENSEX with a gain of 11.33%. In second is our own S&P 500 with a gain of 5.55%. In third is France's CAC 40 with a gain of 1.88%. Coming in last is Shanghai's SSE with a loss of 15.76%.


Investing in Small-Cap-Growth Companies with a Long-Term View

John Barr manages the Needham Aggressive Growth Fund (NEAGX), which had an annualized return of 10.51% over the prior 15 years, versus 9.42% for the S&P 500, for an outperformance of 109 basis points. In this interview, he discusses the outlook for his fund.