The General Advisory Channel

There They Go Again...Again

I’m in the process of writing another book, going into great depth regarding one of the most important things discussed in my book The Most Important Thing: cycles, their causes, and what to do about them. It will be out next year, but this memo will give you a preview regarding one of the most important cyclical phenomena.

Factoring a Gap Year into College Savings

Can 529 funds be used for gap-year expenses? I recently had a parent ask me if their child’s 529 college savings account money could be used to help pay for gap-year expenses. Here’s the short answer: Maybe.

Automation and Anxiety

With artificial intelligence now trained on more commercial applications, many are wondering what other things machines might eventually do better than people. And that prospect is creating economic unease around the world.

Weekly Unemployment Claims: Down Another 15K

Today's seasonally adjusted 233K new claims, down 15K from last week's revised number, was better than the forecast of 245K.

Just more of the same…

Some good data below so I won’t draw out this intro. Stay focused overseas. Keep an eye on earnings which will hopefully be better than the reception that the big banks received on Friday. (But don’t worry, the bank disappointments were interest margin and loan growth caused, not credit related.)

The Rise Of Robots & The Risk To Passive

In Tuesday’s post, “A Shot Across The Bow,” I discussed the recent “Tech Wreck” and the warning sign that was delivered when trading algorithms begin to run in the same direction.

Seven Surprising Insights about Advisory Fees

I asked the readers of my Inside Information service, members of the Advisor Perspectives community, and others, to tell me how they were charging their clients, and how much. The most interesting conclusions related to a key question that has arisen from the DOL Rule: what is a “reasonable” AUM fee to charge clients?

The Ratio of Part-Time Employed Lowest Since 2008

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

Macro Factors and their Impact on Monetary Policy, the Economy, and Financial Markets

During the 35 year secular bull market that began in October 1981, there were a number of sharp increases in yields in which bond prices fell. But investors who held on were bailed out by the secular bull market and eventually recovered all the losses and with gains to show for their patience.

What if Your Coworker is a Gossip?

One of the women in my office is a tattle-tale and a gossip. It’s become so bad that everyone is afraid if they don’t listen or don’t engage with her, they will become one of her targets. She picks on the most benign things; it could be someone’s dress, how they talk or how slow they approach a task.

Donor-Advised Funds versus Donating Directly to Charities

Advisors usually understand how donor-advised funds (DAFs) work, their tax benefits and how they can manage the investments in their clients’ DAF accounts. However, advisors need to help explain their benefits in comparison to donating directly to a charity.

Credit, Finance and Market Stability

Understanding the interplay between credit and finance is critical to recognizing the signs of economic distress. Yet this was precisely the failure that plagued economic analysis leading up to the financial crisis. Let’s take a look at the recent history of credit, finance and the underlying nature of market stability.

Moving Averages: June Month-End Update

Valid until the market close on July 31, 2017.

The S&P 500 closed June with a monthly gain of 0.48% after a gain of 1.16% in May. All three S&P 500 MAs are signaling "invested" and four of the five Ivy Portfolio ETFs — Vanguard Total Stock Market ETF (VTI), Vanguard FTSE All-World ex-US ETF (VEU), iShares Barclays 7-10 Year Treasury (IEF), and Vanguard REIT Index ETF (VNQ) — are signaling "invested".

Short-Term Fears Seem to Affect Millennial Investors in Particular

Many investors who lived through the Global Financial Crisis of 2007-2009 still might bear some scars, according to Franklin Templeton’s annual Retirement Income Strategies and Expectations (RISE) survey. The survey explores individuals’ attitudes and expectations about retirement and how prepared people feel regarding their future.

Bank of America Trashes Risk Parity Funds, Launches One a Month Later

In August 2016, Bank of America Merrill Lynch (BAML) wrote a research note characterizing risk parity as one of the central causes of equity market losses in late 2015. The note had all the hallmarks of a compelling plot line, replete with weapons of mass destruction, billion-dollar bets, and evil villains.