Global elections may lean towards nationalist policies that could hinder trade in goods via tariffs, but also boost growth in domestic industries to counter inflationary effects.
Valuation metrics have little to do with what the market will do over the next few days or months. However, they are essential to future outcomes and shouldn’t be dismissed during the surge in bullish sentiment.
Issues like water scarcity are felt most intensely at the local level. That makes it incumbent on municipal bond issuers to lead the response.
All the fearmongering in Washington over the $1.5 trillion federal budget deficit hides a truth few politicians would admit — that hefty headline number you hear so much about is an unreliable measure of US fiscal health.
I revisited that original post a couple of weeks ago as the market approached its 5000 psychological milestone. Since then, the entire market has surged higher following last week’s earnings report from Nvidia (NVDA).
Equity investors didn't mind the extra day this February as both domestic large-cap stocks and small-to-mid-cap stocks saw steady gains through the month, bringing both groups into positive territory year-to-date, though the latter continues to lag.
Today, we have a different kind of letter. I’ve been in California for some rather innovative and hopefully life/health span-extending medical treatment.
Bitcoin and gold were both top of mind at this past week’s 2024 Investment U Conference in Ojai, California, which I had the privilege of presenting at.
The Nasdaq-100 Index (NDX) is higher by 6.7% year to date. That confirms tech stocks remain in strong form. Still, some market observers are concerned valuations in tech and other high-growth sectors are becoming somewhat frothy.
After a decade in the wilderness, value investing roared back to life in 2022, led by long-forsaken sectors such as energy, industrials and even certain retailers. Many portfolios had either intentionally or unintentionally migrated heavily towards “growth at any price” exposures and were caught wrong-footed that year.
Debt levels will likely continue to rise absent policy changes, and the yield curve is likely to steepen.
Electric vehicle (EV) equities and related exchange traded funds currently appear as though their check engine lights are on.
While the bulls remain entirely in control of the market narrative, divergences and other technical warnings suggest becoming more cautious may be prudent.
We see the usual mess and risks in the world as you do, but we also are seeing more than enough interesting things in which to invest capital.
Municipal bonds posted negative total returns as the market reassessed macro expectations. Seasonal supply-and-demand dynamics were supportive, albeit less so than in prior years.
Bond traders are finally heeding one of the market’s oldest lessons: Don’t fight the Fed.
Tomorrow marks the start of China’s Lunar New Year, meaning it’s out with the Rabbit and in with the Dragon… but all eyes remain on the Bear. And no, I’m not talking about the hit Hulu series, but Russia.
It is certainly a confusing economic environment. Jobs growth is strong yet there are constant reports of high-profile company layoffs. The yield curve is inverted suggesting a recession yet the stock market is at a record high.
The can has been kicked down the road several times but it feels like the end of the road is in sight.
Small businesses are a vital part of the American economy. The U.S. Small Business Administration estimates that they represent over 46% of employment and account for the majority of new job creation. Small business openings are an expression of optimism in an entrepreneur’s ability and support from their community.
Modern economies, even small ones, are unfathomably complex. The number of variables is far more than any human can comprehend or any model can track. It’s really no wonder so many forecasts are wrong.
The Monetary Policy Committee (MPC) vote in favor of keeping the Bank of England (BoE) policy rate at 5.25%.
Political risk is global in 2024: Franklin Templeton Institute’s Kim Catechis highlights key elections to watch across the world in the coming year.
We move on to the recent inflation that was kicked off by the pandemic. This summary allows us to appreciate better the similarities and differences between now and 50 years ago.
Last July, I issued an open letter to the annuity industry requesting the introduction of a product to meet the needs of independent advisors who adhere to a safety-first, goals-based investing philosophy. That call has been answered.
Value investing is the lens through which many view financial markets. Yet, a simple value factor has performed poorly for the last 16 years. Is the value effect over, or will it come back in 2024?
While the S&P 500's all-time high hasn't been accompanied by other parts of the market (notably, small caps), further gains are possible if breadth firms up.
Economic growth continues to defy expectations of a slowdown and recession due to continued increases in deficit spending.
Inflation is not over. The next wave will be torturous and will last a long time.
The race for the White House intensified this week as Donald Trump won the Iowa caucus with 51% of the vote, handily beating rivals Ron DeSantis and Nikki Haley. Results from the online prediction market PredictIt now show that Trump has become the betting favorite to win November’s general election.
Factors are long run drivers of portfolio risk and returns. Having strategic allocations to factors may increase a portfolio’s expected return.
In 2023, the Federal budget deficit exceeded private and foreign saving, resulting in only the eighth year since 1929 with negative net national saving (to be referred to as NNNS).
“The current fiscal path is unsustainable”. This stark warning comes from the US Treasury Department’s Bureau of the Fiscal Service’s fiscal year-end projections1. Based on current appropriations and tax law, these projections display steadily rising federal spending and flat tax receipts, as a percentage of GDP.
Why we believe small companies present key opportunities to tap into the heart of innovation and expansion in emerging markets.
Markets in 2023 kept investors on the edge of their seats. Groundbreaking technological advancements, mega-popstars being blamed for summertime inflation, and a December Fed pivot were just a few of the plot twists.
The January effect, named for the market anomaly where stock returns in January are typically higher than in other months, has been a subject of interest since it was first documented in 1942.
Rates are heading down, volatility will increase and there is a 75% chance of a recession in 2024, according to Jeffrey Gundlach.
In December 2022, I published Sea Change, a memo that primarily discussed the 13-year period from the end of 2008, when the U.S. Federal Reserve cut the fed funds rate to zero to counter the effects of the Global Financial Crisis, to the end of 2021, when the Fed abandoned the idea that inflation was transitory and readied what turned out to be a rapid-fire succession of interest rate increases.
The U.S. is adding new renewable energy capacity at a record clip, but that doesn’t mean it’s ready to quit fossil fuels just yet.
Enthusiasm for Japanese equities picked up in 2023 as evidenced by the 28% rally in the TOPIX (local) index through November.
The strongest stock market returns in the coming decade, perhaps longer, are likely to emerge during advances in the S&P 500 that attempt to catch up with the cumulative return of risk-free Treasury bills.
Tweedy Browne is one of the most respected value managers. In this wide-ranging interview with its investment team, they explain why the opportunity set they are seeing among stocks is the best in 20-plus years.
As 2023 comes to an end, let’s revisit the top 10 most-read AP charts of the year.
As we near the end of 2023, Head of Franklin Institute Stephen Dover reviews how his forecasts for the year panned out and shares the themes his team is watching out for in 2024.
A recent warning by YahooFinance warns investors to sell their cash and buy bonds and stocks now as the Fed pauses.
Municipal bonds posted their best performance of the year, and we believe municipal credit conditions remain strong.
The US Federal Reserve and its chair, Jerome Powell, are betting that they can have the best of both worlds — that they’ll be able to defeat excessive inflation without forcing the economy into recession.
While the ECB is unlikely to raise rates further, we remain skeptical that it will deliver rate cuts as early as the market expects.
The year 2008 and the subsequent Global Financial Crisis (GFC) stand as a watershed moment in the annals of our capitalist society. It was a bailout prompted by poor capital allocation, deficient risk management, and unchecked greed.
Domestic aggregate bond strategies are on pace for decent showings this year. And there is mounting speculation that the Federal Reserve will lower interest rates next year, perhaps multiple times.
