GMO Quarterly Letter
In a new quarterly letter to GMO's institutional clients, head of asset allocation Ben Inker discusses why investors should be thinking about the risks of surging inflation, even if such a surge may not be inevitable or even probable. Chief investment strategist Jeremy Grantham considers the current market environment and how to most rationally take risk with the ultimate stakes on the line.
Political Noise, Market Poise
A review of last month’s market-moving events across countries and asset classes.
Gold Rush to Tech Rush
Over the weekend I stopped to watch the last part of a James Stewart Western called, The Far Country. It was the story of two cattle drivers who took their cattle all the way to the Yukon to get a piece of the late 1890’s Klondike gold rush.
Weighing the Week Ahead: Plenty of Cross-Winds for Santa
The economic calendar is normal, but there are plenty of cross-currents from other major events. Bitcoin futures, the FOMC meeting, more debate on the tax legislation, the Alabama special Senate election, and an avalanche of 2018 forecasts.
Why Is Inflation below Target in So Many Advanced Economies?
Since the global financial crisis, inflation in the advanced economies has persistently undershot their 2% targets despite unprecedented quantitative easing (QE), extraordinarily low interest rates, large fiscal deficits and near all-time low unemployment.
This Week in Bitcoin: The IRS Targets Coinbase, Venezuela to Mint Its Own Cryptocurrency
Writing about blockchain and bitcoin right now is a little like buying a new computer in the 1990s. The tech was advancing so fast in those days that as soon as you brought the thing home, it was sorely outdated. Similarly, the cryptocurrency world is changing so rapidly at the moment that even before “the ink dries” on one of my posts, some important new development has already surfaced.
Q3 Household Net Worth: The "Real" Story
Let's take a long-term view of household net worth from the latest Z.1 release. A quick glance at the complete data series shows a distinct bubble in net worth that peaked in Q4 2007 with a trough in Q1 2009, the same quarter the stock market bottomed. The latest Fed balance sheet shows a total net worth at an all-time high — 76.7% above the 2009 trough. The nominal Q3 net worth is up 1.4% from the previous quarter and 5.9% year-over-year.
China Clears Way for More Foreign Participation
At this time of the year, smog in Beijing, China, can be overwhelming. Throughout the city this fog/smog prevents the sun from shining through. But, the pollution problems have not clouded financial activity.
Fake Tax Reform
After supposedly chomping on the bit for years to pass meaningful tax reform, Republicans are now set to blow an historic opportunity. Whatever version of the Bill that emerges from the House and Senate Conference Committee...
Skis and Bikes: The Untold Story of Diversification
In most parts of Canada we have very distinct seasons. Some months of the year are temperate and relatively dry, while other months are cold and snowy. As a result, most Canadian towns of any size have stores that sell skis and bikes.
Fully Invested Bear
So, we are now in the ebullient month of December and as often stated, “It is tough to put stocks away to the downside in December. It can happen, but it’s pretty rare.” In fact, there were only two years that saw negative returns for the S&P 500 (SPX/2642.22) in December.
Is Now the Time to Invest in Alternatives?
I recently have been traveling around the country participating on a panel titled: “Alternatives: Time to Buy When Others Are Selling?” Spoiler alert — my answer to that question is a resounding “yes.” There are two reasons why.
Help Clients Make Charitable Giving History
Why strong markets, possible tax reform, and disaster relief and recovery may trigger the biggest giving year in U.S. history
Real Disposable Income Per Capita Gains in October
With the release of yesterday's report on October Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal 0.39% month-over-month change in disposable income was trimmed to 0.25% when we adjust for inflation. The year-over-year metrics are 2.52% nominal and 0.92% real. The trend since 2013 has been one of steady growth.
Moving Averages: November Month-End Update
Valid until the market close on December 29, 2017.
The S&P 500 closed November with a monthly gain of 2.81% after a gain of 2.22% in October. All three S&P 500 MAs are signaling "invested" and all 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), and PowerShares DB Commodity Index (DBC) — are signaling "invested".